Question

Select a publicly traded company that makes strong use of intangible assets.

use sec.gov to look up the 10-K form.

1. What percent of total assets are intangible?

2. What is the company's largest intangible asset? Is this an asset the company actively uses in operations?

3. Identify the disclosures the company makes concerning its intangible assets.

4. Was there a change in intangible assets for the period? Identify the cause of the change.

Answer 1

Apple Inc.

Step-1: Reason for considering Apple Inc.

As compared to its peer competitors in the industry producing the same product, I found that Apple Inc. products does have a distinctively high price for the similar products being made available in the market by its competitors.

Step-2: Financial Information for the year ended September 30,2017:

1. Percentage of Intangible assets:

Particulars	Amount (in $ millions)
Goodwill	5717
Acquired intangible assets	2298
Total Intangible assets	8015
Total Assets	375319
% of Intangible assets	2.15%

2. Company,s largest intangible asset:

• The Companies intangible assets mainly consist of brands that supports for Design of products.
• Company is using actively in the business for the purpose of designing the new products.
• Company using these brands introducing new Apple I PAD’s, Apple I Phones etc.,

3.Disclosures made by the company concerning to Intangible assets:

• The Company does not amortize goodwill and intangible assets with indefinite useful lives; rather, such assets are required to be tested for impairment at least annually or sooner if events or changes in circumstances indicate that the assets may be impaired.
• The Company performs its goodwill and intangible asset impairment tests in the fourth quarter of each year. The Company did not recognize any impairment charges related to goodwill or indefinite lived intangible assets during 2017 , 2016and 2015 . For purposes of testing goodwill for impairment, the Company established reporting units based on its current reporting structure.
• Goodwill has been allocated to these reporting units to the extent it relates to each reporting unit. In 2017 and 2016, the Company’s goodwill was primarily allocated to the Americas and Europe reporting units.
• The Company amortizes its intangible assets with definite useful lives over their estimated useful lives and reviews these assets for impairment. The Company typically amortizes its acquired intangible assets with definite useful lives over periods from three to seven years.

           Acquired Intangible assets:

• The Company’s acquired intangible assets with definite useful lives primarily consist of patents and licenses. The following table summarizes the components of acquired

intangible asset balances as of September 30, 2017 and September 24, 2016 (in millions):

Particulars	Gross Carrying Amount (in million $)	Accumulated Amortisation(in million $)	Net Carrying amount (in million $)
Definite-lived and amortised acquired intangible assets	7507	(5309)	2198
Indefinite lived and non-amortised acquired intangible assets	100	-	100
Total Acquired Intangible assets	7607	(5309)	2298

4. Change in intangible assets:

• In the current year the company acquired intangible assets value of $344 million. Further the amortisation for the period amounting to $ 497 million.