Goodwill and Intangible Assets Accounting Policy
Goodwill represents the excess of costs over the fair value of net assets of businesses acquired. Panasonic adopted the provisions of ASC 350, "Intangibles—Goodwill and Other." Goodwill and intangible assets determined to have an indefinite useful life are not amortized, and are instead reviewed for impairment at least annually based on assessment of current estimated fair value of the intangible asset. The goodwill impairment test is a two-step test. Under the first step, the fair value of the reporting unit is compared with its carrying value (including goodwill). If the fair value of the reporting unit is less than its carrying value, an indication of goodwill impairment exists for the reporting unit and the enterprise must perform the second step of the impairment test (measurement). If the fair value of the reporting unit exceeds its carrying amount, the second step does not need to be performed. Under the second step, an impairment loss is recognized for any excess of the carrying amount of the reporting unit's goodwill over the implied fair value of that goodwill. The implied fair value of goodwill is determined by allocating the fair value of the reporting unit in a manner similar to a purchase price allocation in business combinations. The residual fair value after this allocation is the implied fair value of the reporting unit goodwill. Fair value of the reporting unit is determined using a guideline merged and acquired company method, guideline public company method, and a discounted cash flow analysis. The provisions of ASC 350 also requires that intangible assets with estimable useful lives be amortized over their respective estimated useful lives to their estimated residual values, and reviewed for impairment based on an assessment of the undiscounted cash flows expected by the asset, whenever impairment indications are presented. An impairment charge is recognized for the amount by which the carrying amount of the asset exceeds the fair value of the asset.
Source: Panasonic Corp., Annual Report
Goodwill and Intangible Assets Disclosure
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Panasonic Corp., Statement of Financial Position, Goodwill and Intangible Assets
USD $ in millions, translated from JPY ￥
Source: Based on data from Panasonic Corp. Annual Reports
| Item |
Description |
The company |
| Acquired intangible assets, excluding goodwill |
Sum of the carrying amounts of all intangible assets, excluding goodwill, as of the balance sheet date, net of accumulated amortization and impairment charges. |
Panasonic Corp.'s acquired intangible assets, excluding goodwill increased from 2009 to 2010 but then slightly declined from 2010 to 2011.
|
| Goodwill |
Carrying amount as of the balance sheet date, which is the cumulative amount paid and (if applicable) the fair value of any noncontrolling interest in the acquiree, adjusted for any amortization recognized prior to the adoption of any changes in generally accepted accounting principles (as applicable) and for any impairment charges, in excess of the fair value of net assets acquired in one or more business combination transactions. |
Panasonic Corp.'s goodwill increased from 2009 to 2010 and from 2010 to 2011.
|
| Goodwill and other intangible assets |
Sum of the carrying amounts of all intangible assets, including goodwill, as of the balance sheet date, net of accumulated amortization and impairment charges. |
Panasonic Corp.'s goodwill and other intangible assets increased from 2009 to 2010 and from 2010 to 2011.
|
Analyst Adjustments: Removal of Goodwill
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Panasonic Corp., adjustments to financial data
USD $ in millions, translated from JPY ￥
Adjusted Ratios: Removal of Goodwill (Summary)
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Panasonic Corp., adjusted ratios
| Ratio |
Description |
The company |
| Adjusted net profit margin |
An indicator of profitability, calculated as adjusted net income divided by revenue. |
Panasonic Corp.'s adjusted net profit margin improved from 2009 to 2010 and from 2010 to 2011.
|
| Adjusted total asset turnover |
An activity ratio calculated as total revenue divided by adjusted total assets. |
Panasonic Corp.'s adjusted total asset turnover deteriorated from 2009 to 2010 but then improved from 2010 to 2011 not reaching 2009 level.
|
| Adjusted financial leverage |
A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity.
Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income. |
Panasonic Corp.'s adjusted financial leverage increased from 2009 to 2010 and from 2010 to 2011.
|
| Adjusted ROE |
A profitability ratio calculated as adjusted net income divided by adjusted shareholders' equity. |
Panasonic Corp.'s adjusted ROE improved from 2009 to 2010 and from 2010 to 2011.
|
| Adjusted ROA |
A profitability ratio calculated as adjusted net income divided by adjusted total assets. |
Panasonic Corp.'s adjusted ROA improved from 2009 to 2010 and from 2010 to 2011.
|
Adjusted Net Profit Margin
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2011 Calculations
| Ratio |
Description |
The company |
| Adjusted net profit margin |
An indicator of profitability, calculated as adjusted net income divided by revenue. |
Panasonic Corp.'s adjusted net profit margin improved from 2009 to 2010 and from 2010 to 2011.
|
Adjusted Total Asset Turnover
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2011 Calculations
| Ratio |
Description |
The company |
| Adjusted total asset turnover |
An activity ratio calculated as total revenue divided by adjusted total assets. |
Panasonic Corp.'s adjusted total asset turnover deteriorated from 2009 to 2010 but then improved from 2010 to 2011 not reaching 2009 level.
|
Adjusted Financial Leverage
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2011 Calculations
| Ratio |
Description |
The company |
| Adjusted financial leverage |
A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity.
Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income. |
Panasonic Corp.'s adjusted financial leverage increased from 2009 to 2010 and from 2010 to 2011.
|
Adjusted Return On Equity (ROE)
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2011 Calculations
| Ratio |
Description |
The company |
| Adjusted ROE |
A profitability ratio calculated as adjusted net income divided by adjusted shareholders' equity. |
Panasonic Corp.'s adjusted ROE improved from 2009 to 2010 and from 2010 to 2011.
|
Adjusted Return On Assets (ROA)
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2011 Calculations
| Ratio |
Description |
The company |
| Adjusted ROA |
A profitability ratio calculated as adjusted net income divided by adjusted total assets. |
Panasonic Corp.'s adjusted ROA improved from 2009 to 2010 and from 2010 to 2011.
|
