BUSINESS COMBINATIONS AND GOODWILL
On July 8, 2013, the Company acquired Acquity Group Ltd. (“Acquity”), a provider of strategy, digital marketing and technical services, for $282,985, net of cash acquired. This acquisition expanded Accenture’s range of digital marketing services and resulted in more than 600 Acquity employees joining Accenture. In connection with this acquisition, the Company recorded goodwill of $215,979, which was allocated to the Products, Communication, Media & Technology and Financial Services reportable segments, and intangible assets of $55,972, primarily related to customer relationships and technology-related assets. The goodwill is not deductible for U.S. federal income tax purposes. The intangible assets are being amortized over one to ten years. The pro forma effects on the Company’s operations were not material.
During fiscal 2013, the Company also completed other individually immaterial acquisitions, including a provider of clinical and regulatory information management solutions and software for the pharmaceutical industry and a provider of loan origination software and electronic document management services, for total consideration of $521,003. These acquisitions were completed primarily to expand the Company’s products and services offerings. In connection with these acquisitions, the Company recorded goodwill of $405,151, which was allocated among the reportable operating segments, and intangible assets of $122,012, primarily related to customer relationships and technology-related assets. Goodwill also included immaterial adjustments related to prior period acquisitions and is not deductible for U.S. federal income tax purposes. The intangible assets are being amortized over one to fifteen years. The pro forma effects on the Company’s operations were not material.
During fiscal 2012, the Company completed several individually immaterial acquisitions, including a provider of residential and commercial mortgage processing services, for total consideration of $174,383. In connection with these acquisitions, the Company recorded goodwill of $123,817, which was allocated among the reportable operating segments, and intangible assets of $57,732, primarily related to customer relationships. Goodwill also included immaterial adjustments related to prior period acquisitions. The intangible assets are being amortized over three to seven years. The pro forma effects on the Company’s operations were not material.
During fiscal 2011, the Company completed several individually immaterial acquisitions, including a provider of software solutions for the property and casualty insurance industry, for total consideration of $306,187. In connection with these acquisitions, the Company recorded goodwill of $254,975, which was allocated among the reportable operating segments, and intangible assets of $81,735, primarily related to customer relationships and intellectual property. The intangible assets are being amortized over a period of less than one to fifteen years. The pro forma effects on the Company’s operations were not material.
Goodwill is reviewed for impairment annually or more frequently if indicators of impairment exist. Based on the results of its annual impairment analysis, the Company determined that no impairment existed as of August 31, 2013 and 2012.
The changes in the carrying amount of goodwill by reportable operating segment were as follows:
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | |
| August 31,
2011 | | Additions/
Adjustments | | Foreign
Currency
Translation | | August 31,
2012 | | Additions/
Adjustments | | Foreign
Currency
Translation | | August 31,
2013 |
Communications, Media &
Technology | $ | 173,867 |
| | $ | 2,298 |
| | $ | (7,752 | ) | | $ | 168,413 |
| | $ | 69,879 |
| | $ | (3,848 | ) | | $ | 234,444 |
|
Financial Services | 304,720 |
| | 112,733 |
| | (9,497 | ) | | 407,956 |
| | 182,800 |
| | (8,107 | ) | | 582,649 |
|
Health & Public Service | 286,158 |
| | 1,322 |
| | (2,147 | ) | | 285,333 |
| | 10,287 |
| | (576 | ) | | 295,044 |
|
Products | 278,929 |
| | 5,241 |
| | (13,992 | ) | | 270,178 |
| | 347,847 |
| | (1,017 | ) | | 617,008 |
|
Resources | 88,317 |
| | 3,147 |
| | (7,961 | ) | | 83,503 |
| | 9,988 |
| | (4,050 | ) | | 89,441 |
|
Total | $ | 1,131,991 |
| | $ | 124,741 |
| | $ | (41,349 | ) | | $ | 1,215,383 |
| | $ | 620,801 |
| | $ | (17,598 | ) | | $ | 1,818,586 |
|
