NOTE 8
Other Assets
The following is a summary of other assets as of December 31:
| (Millions) | 2013 | 2012 | ||||
| Goodwill | $ | 3,198 | $ | 3,181 | ||
| Deferred tax assets, net(a) | 2,443 | 2,458 | ||||
| Prepaid expenses(b) | 1,998 | 1,960 | ||||
| Other intangible assets, at amortized cost | 817 | 993 | ||||
| Restricted cash(c) | 486 | 568 | ||||
| Derivative assets(a) | 329 | 593 | ||||
| Other | 1,957 | 1,665 | ||||
| Total | $ | 11,228 | $ | 11,418 | ||
Goodwill
Goodwill represents the excess of acquisition cost of an acquired company over the fair value of assets acquired and liabilities assumed. The Company assigns goodwill to its reporting units for the purpose of impairment testing. A reporting unit is defined as an operating segment, or a business that is one level below an operating segment for which discrete financial information is regularly reviewed by the operating segment manager. The Company evaluates goodwill for impairment annually as of June 30 and between annual tests if events occur or circumstances change that would more likely than not reduce the fair value of the reporting unit below its carrying value. The goodwill impairment test utilizes a two-step approach. The first step in the impairment test identifies whether there is potential impairment by comparing the fair value of a reporting unit to the carrying amount, including goodwill. If the fair value of a reporting unit is less than its carrying amount, the second step of the impairment test is required to measure the amount of any impairment loss. As of December 31, 2013 and 2012, goodwill was not impaired and there were no accumulated impairment losses.
Goodwill impairment testing involves management judgment, requiring an assessment of whether the carrying value of the reporting unit can be supported by its fair value using widely accepted valuation techniques. The Company uses a combination of the income approach (discounted cash flows) and market approach (market multiples).
When preparing discounted cash flow models under the income approach, the Company uses internal forecasts to estimate future cash flows expected to be generated by the reporting units. Actual results may differ from forecasted results. The Company calculates discount rates based on the expected cost of equity financing, estimated using a capital asset pricing model, to discount future cash flows for each reporting unit. The Company believes the discount rates used appropriately reflect the risks and uncertainties in the financial markets generally and specifically in the Company's internally developed forecasts. When using market multiples under the market approach, the Company applies comparable publically traded companies' multiples (e.g. earnings, revenues) to its reporting units' actual results.
The changes in the carrying amount of goodwill reported in the Company's reportable operating segments and Corporate & Other were as follows:
| Corporate & | ||||||||||||||||||
| (Millions) | USCS | ICS | GCS | GNMS | Other | Total | ||||||||||||
| Balance as of January 1, 2012 | $ | 175 | $ | 1,023 | $ | 1,543 | $ | 160 | $ | 271 | $ | 3,172 | ||||||
| Acquisitions | ― | 1 | ― | ― | ― | 1 | ||||||||||||
| Dispositions | ― | (2) | (1) | ― | ― | (3) | ||||||||||||
| Other, including foreign currency translation | ― | 9 | 2 | ― | ― | 11 | ||||||||||||
| Balance as of December 31, 2012 | $ | 175 | $ | 1,031 | $ | 1,544 | $ | 160 | $ | 271 | $ | 3,181 | ||||||
| Acquisitions | ― | ― | ― | ― | ― | ― | ||||||||||||
| Dispositions | ― | ― | ― | ― | ― | ― | ||||||||||||
| Other, including foreign currency translation | (1) | 21 | (1) | ― | (2) | 17 | ||||||||||||
| Balance as of December 31, 2013 | $ | 174 | $ | 1,052 | $ | 1,543 | $ | 160 | $ | 269 | $ | 3,198 | ||||||
Other Intangible Assets
Intangible assets, primarily customer relationships, are amortized over their estimated useful lives of 1 to 22 years on a straight-line basis. The Company reviews intangible assets for impairment quarterly and whenever events and circumstances indicate their carrying amounts may not be recoverable. In addition, on an annual basis, the Company performs an impairment evaluation of all intangible assets by assessing the recoverability of the asset values based on the cash flows generated by the relevant assets or asset groups. An impairment is recognized if the carrying amount is not recoverable and exceeds the asset's fair value.
The components of other intangible assets were as follows:
| 2013 | 2012 | |||||||||||||||||
| (Millions) | Gross Carrying Amount | Accumulated Amortization | Net Carrying Amount | Gross Carrying Amount | Accumulated Amortization | Net Carrying Amount | ||||||||||||
| Customer relationships(a) | $ | 1,297 | $ | (660) | $ | 637 | $ | 1,238 | $ | (526) | $ | 712 | ||||||
| Other | 269 | (89) | 180 | 428 | (147) | 281 | ||||||||||||
| Total | $ | 1,566 | $ | (749) | $ | 817 | $ | 1,666 | $ | (673) | $ | 993 | ||||||
Amortization expense for the years ended December 31, 2013, 2012 and 2011 was $193 million, $198 million and $189 million, respectively. Intangible assets acquired in both 2013 and 2012 are being amortized, on average, over 6 years.
Estimated amortization expense for other intangible assets over the next five years is as follows:
| (Millions) | 2014 | 2015 | 2016 | 2017 | 2018 | ||||||||||
| Estimated amortization expense | $ | 184 | $ | 164 | $ | 123 | $ | 72 | $ | 61 |
Other
The Company had $541 million and $427 million in affordable housing and other tax credit investment partnership interests as of December 31, 2013 and 2012, respectively, included in other assets in the table above. The Company is a non-controlling partner in these tax credit investment partnerships, and therefore accounts for its ownership interests in accordance with GAAP governing equity method investments and joint ventures.