Matthews International Corporation Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

Goodwill and Other Intangible Assets

Goodwill and Other Intangible Assets

9 Months Ended

Jun. 30, 2011

Goodwill and Other Intangible Assets [Abstract]

Note 12. Goodwill and Other Intangible Assets

Goodwill related to business combinations is not amortized but is subject to annual review for impairment. In general, when the carrying value of a reporting unit exceeds its implied fair value, an impairment loss must be recognized. For purposes of testing for impairment, the Company uses a discounted cash flow technique. Intangible assets are amortized over their estimated useful lives unless such lives are considered to be indefinite. A significant decline in cash flows generated from these assets may result in a write-down of the carrying values of the related assets.

The Company performed its annual impairment review in the second fiscal quarter of 2011 and determined that no additional adjustments to the carrying values of goodwill or indefinite-lived intangible assets were necessary.

A summary of the carrying amount of goodwill attributable to each segment as well as the changes in such amounts are as follows:

									Graphics			Marking		Merchandising
	Bronze			Casket		Cremation			Imaging			Products		Solutions		Consolidated

Goodwill	$	88,613		$	140,553	$	16,799		$	149,161		$	10,168	$	9,138	$	414,432
Accumulated impairment losses		(412	)		-		(5,000	)		(3,840	)		-		-		(9,252	)
Balance at September 30, 2010		88,201			140,553		11,799			145,321			10,168		9,138	$	405,180

Additions during period		-			22,266		-			4,917			4,850		-		32,033
Translation and other adjustments		1,904			-		206			7,960			190		-		10,260
Goodwill		90,517			162,819		17,005			162,038			15,208		9,138		456,725
Accumulated impairment losses		(412	)		-		(5,000	)		(3,840	)		-		-		(9,252	)
Balance at June 30, 2011	$	90,105		$	162,819	$	12,005		$	158,198		$	15,208	$	9,138	$	447,473

The addition to Casket goodwill primarily represents the acquisition of Freeman; the addition to Graphics goodwill represents the acquisition of the remaining 25% interest in Reproflex; and the addition to Marking Products goodwill represents the acquisition of IPTI.

The following tables summarize the carrying amounts and related accumulated amortization for intangible assets as of June 30, 2011 and September 30, 2010, respectively.

	Carrying		Accumulated
	Amount		Amortization			Net
June 30, 2011:
Trade names	$	24,445	$	-	*	$	24,445
Trade names		1,784		(1,114	)		670
Customer relationships		43,177		(13,009	)		30,168
Copyrights/patents/other		9,695		(6,910	)		2,785
	$	79,101	$	(21,033	)	$	58,068

September 30, 2010:
Trade names	$	24,314	$	-	*	$	24,314
Trade names		1,689		(780	)		909
Customer relationships		40,607		(10,674	)		29,933
Copyrights/patents/other		8,984		(6,198	)		2,786
	$	75,594	$	(17,652	)	$	57,942
* Not subject to amortization

The net change in intangible assets during the nine months ended June 30, 2011 included the acquisition of intangibles in connection with the Freeman acquisition, in addition to the impact of foreign currency fluctuations during the period and additional amortization.

Amortization expense on intangible assets was $1,060 and $954 for the three-month periods ended June 30, 2011 and 2010, respectively. For the nine-month periods ended June 30, 2011 and 2010, amortization expense was $3,274 and $2,741, respectively. The remaining amortization expense is estimated to be $730 in 2011, $3,200 in 2012, $2,874 in 2013, $2,702 in 2014 and $2,540 in 2015.

- Definition

The entire disclosure for the aggregate amount of goodwill and a description of intangible assets, which may include (a) for amortizable intangible assets (also referred to as finite-lived intangible assets), the carrying amount, the amount of any significant residual value, and the weighted-average amortization period, (b) for intangible assets not subject to amortization (also referred to as indefinite-lived intangible assets), the carrying amount, and (c) the amount of research and development assets acquired and written off in the period, including the line item in the income statement in which the amounts written off are aggregated, if not readily apparent from the income statement. Also discloses (a) for amortizable intangibles assets in total and by major class, the gross carrying amount and accumulated amortization, the total amortization expense for the period, and the estimated aggregate amortization expense for each of the five succeeding fiscal years, (b) for intangible assets not subject to amortization the carrying amount in total and by major class, and (c) for goodwill, in total and for each reportable segment, the changes in the carrying amount of goodwill during the period (including the aggregate amount of goodwill acquired, the aggregate amount of impairment losses recognized, and the amount of goodwill included in the gain (loss) on disposal of a reporting unit). If any part of goodwill has not been allocated to a reportable segment, discloses the unallocated amount and the reasons for not allocating. For each impairment loss recognized related to an intangible asset (excluding goodwill), discloses: (a) a description of the impaired intangible asset and the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method for determining fair value, (c) the caption in the income statement or the statement of activities in which the impairment loss is aggregated, and (d) the segment in which the impaired intangible asset is reported. For each goodwill impairment loss recognized, discloses: (a) a description of the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method of determining the fair value of the associated reporting unit, and (c) if a recognized impairment loss is an estimate not finalized and the reasons why the estimate is not final. May also disclose the nature and amount of any significant adjustments made to a previous estimate of an impairment loss.

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