Philips 2005 Annual Report Download - page 154

Philips Annual Report 2005154
18
Intangible assets excluding goodwill
The changes during 2005 were as follows:
total
other
intangible
assets
intangible
pension
asset software
Balance as of
January 1, 2005
Cost 2,103 1,254 107 742
Accumulated
amortization (1,116) (573) −(543)
Book value 987 681 107 199
Changes in book
value:
Acquisitions/additions 466 372 −94
Amortization/
deductions (277) (139) (25) (113)
Translation differences 124 112 4 8
Changes in
consolidation (1) (1) − −
Total changes 312 344 (21) (11)
Balance as of
December 31, 2005
Cost 2,655 1,813 86 756
Accumulated
amortization (1,356) (788) −(568)
Book value 1,299 1,025 86 188
Other intangible assets in 2005 consist of:
January 1 December 31
gross
accumulated
amortization gross
accumulated
amortization
Marketing-
related 40 (37) 62 (43)
Customer-
related 454 (109) 646 (144)
Contract-
based 11 (6) 46 (11)
Technology-
based 620 (347) 902 (486)
Patents and
trademarks 129 (74) 157 (104)
1,254 (573) 1,813 (788)
The estimated amortization expense for these other intangible assets
foreachofthevesucceedingyearsare:
2006 145
2007 127
2008 127
2009 123
2010 111
All intangible assets, excluding goodwill, are subject to amortization and
have no assumed residual value.
The expected weighted average remaining life of other intangibles is
5 years as of December 31, 2005.
The unamortized costs of computer software to be sold, leased or
otherwise marketed amounted to EUR 50 million at the end of 2005
(2004: EUR 25 million). The amounts charged to the income statement
for amortization or impairment of these capitalized computer software
costs amounted to EUR 13 million (2004: EUR 6 million).
19
Goodwill
The changes during 2005 were as follows:
2004 2005
Book value as of January 1 2,494 1,818
Changes in book value:
Acquisitions 46 689
Divestments −(34)
Impairment losses (596) −
Reclassicationfromunconsolidatedcompanies − 13
Translation differences (126) 262
Book value as of December 31 1,818 2,748
Acquisitions, in 2005, include the goodwill paid on the acquisition of
Stentor for EUR 115 million and Lumileds for EUR 554 million, both in
the US, and several smaller acquisitions.
In 2004, Philips recognized impairment charges of EUR 590 million
relating to MedQuist (please refer to note 3).
Please refer to the section Information by sectors and main countries
onpage132foraspecicationofgoodwillbysector.
Acquisitions in 2004 represent the goodwill paid on the acquisitions
of Philips-Neusoft Medical Systems in China and Gemini Industries in
the US.
Groupnancialstatements