Quarterly report pursuant to Section 13 or 15(d)

Goodwill and Intangible Assets (Notes)

v3.5.0.2
Goodwill and Intangible Assets (Notes)
9 Months Ended
Jun. 30, 2016
Goodwill and Intangible Assets Disclosure [Abstract]  
Goodwill and Intangible Assets Disclosure [Text Block]
Intangible Assets and Goodwill

Intangible Assets

Intangible assets are stated at the lower of cost or fair value.  With the exception of most trade names, intangible assets are amortized on a straight-line basis over periods ranging from three to 22 years, representing the period over which we expect to receive future economic benefits from these assets.  We assess the carrying value of most trade names annually, or more often if events or changes in circumstances indicate there may be impairment.  

The following tables summarize the carrying amounts and related accumulated amortization for intangible assets as of June 30, 2016 and September 30, 2015.
 

 
June 30, 2016
 
September 30, 2015
 
Cost
 
Accumulated
Amortization
 
Cost
 
Accumulated
Amortization
Finite-lived assets:
 

 
 

 
 

 
 

Trade names
$
0.2

 
$
(0.1
)
 
$
0.2

 
$
(0.1
)
Customer relationships
459.7

 
(94.6
)
 
374.0

 
(78.7
)
Technology, including patents
78.5

 
(32.0
)
 
62.3

 
(28.0
)
Software
45.8

 
(39.3
)
 
43.3

 
(37.7
)
Other
0.4

 
(0.3
)
 
0.4

 
(0.3
)
 
584.6

 
(166.3
)
 
480.2

 
(144.8
)
Indefinite-lived assets:
 

 
 

 
 

 
 

Trade names
130.1

 

 
124.2

 

 
 
 
 
 
 
 
 
Total
$
714.7

 
$
(166.3
)
 
$
604.4

 
$
(144.8
)

As a result of the required annual impairment assessment performed in the third quarter of 2016, the Company tested the recoverability of its indefinite-lived assets, and recorded a trade name impairment charge of $2.2 related to the Process Equipment Group segment on two trade names. The impairment charge was included in operating expenses on the Consolidated Statements of Income. The decline in the estimated fair value of these trade names was largely driven by the decreased demand for equipment and parts used in coal mining and coal power.

The net change in intangible assets during the nine months ended June 30, 2016, included the acquisitions of Abel in October 2015 and Red Valve in February 2016 (see Note 3), offset by the impact of foreign currency fluctuations during the period, trade name impairment of $2.2 related to the Process Equipment Group segment, and normal amortization.

Goodwill

Goodwill is not amortized, but is subject to annual impairment tests.  Goodwill has been assigned to reporting units.  We assess the carrying value of goodwill annually, or more often if events or changes in circumstances indicate there may be impairment.  Impairment testing is performed at a reporting unit level.

 
Process
Equipment
Group
 
Batesville
 
Total
Balance September 30, 2015
$
535.7

 
$
8.3

 
$
544.0

Acquisitions
97.6

 

 
97.6

Foreign currency adjustments
(5.8
)
 

 
(5.8
)
Balance June 30, 2016
$
627.5

 
$
8.3

 
$
635.8



As a result of the required annual impairment assessment performed in the third quarter of 2016, the Company tested the recoverability of its goodwill, and in all reporting units, fair value of goodwill was determined to exceed the carrying value, resulting in no impairment to goodwill.