American Express 2010 Annual Report Download - page 90

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The changes in the carrying amount of goodwill reported in the Company’s reportable operating segments and Corporate & Other were
as follows:
(Millions) USCS ICS GCS GNMS
Corporate &
Other Total
Balance as of January 1, 2009 $ 175 $ 509 $ 1,573 $ 28 $ 16 $ 2,301
Other, including foreign currency translation — 3 24 — — 27
Balance as of December 31, 2009 $ 175 $ 512 $ 1,597 $ 28 $ 16 $ 2,328
Acquisitions
(a)
— — — 131 184 315
Dispositions — — (2) — — (2)
Other, including foreign currency translation — (1) (1) — — (2)
Balance as of December 31, 2010 $ 175 $ 511 $ 1,594 $ 159 $ 200 $ 2,639
(a) Comprised of $131 million and $184 million for the acquisition of Accertify Inc. and Revolution Money Inc., respectively. Refer to Note 2 for further discussion.
OTHER INTANGIBLE ASSETS
Intangible assets are amortized over their estimated useful lives
of 1 to 22 years. The Company reviews intangible assets for
impairment quarterly and whenever events and circumstances
indicate that their carrying amounts may not be recoverable. In
addition, on an annual basis, the Company performs an
impairment evaluation of all intangible assets by assessing the
recoverability of the asset values based on the cash flows
generated by the relevant assets or asset groups. An
impairment is recognized if the carrying amount is not
recoverable and exceeds the asset’s fair value.
The components of other intangible assets were as follows:
(Millions)
Gross Carrying
Amount
Accumulated
Amortization
Net Carrying
Amount
Gross Carrying
Amount
Accumulated
Amortization
Net Carrying
Amount
2010 2009
Customer relationships $ 1,125 $ (332) $ 793 $ 873 $ (240) $ 633
Other 262 (83) 179 145 (61) 84
Total $ 1,387 $ (415) $ 972 $ 1,018 $ (301) $ 717
Amortization expense for the years ended December 31, 2010, 2009 and 2008 was $176 million, $140 million and $83 million,
respectively. Intangible assets acquired in 2010 and 2009 are being amortized, on average, over 8 years and 5 years, respectively.
Estimated amortization expense for other intangible assets over the next five years is as follows:
(Millions) 2011 2012 2013 2014 2015
Estimated amortization expense $ 178 $ 168 $ 156 $ 131 $ 117
OTHER
The Company has $197 million and $168 million in affordable
housing partnership interests as of December 31, 2010 and 2009,
respectively, included in other assets in the table above. The
Company is a limited partner and typically has a less than
50 percent interest in the affordable housing partnerships.
These partnership interests are accounted for in accordance
with GAAP governing equity method investments and
joint ventures.
88
AMERICAN EXPRESS COMPANY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS