The following table provides additional information about the intangible assets that were impaired during 2013 in Other (income)/deductions––net : | ||||||||||||||||||||
Year Ended December 31, | ||||||||||||||||||||
Fair Value(a) | 2013 | |||||||||||||||||||
(MILLIONS OF DOLLARS) | Amount | Level 1 | Level 2 | Level 3 | Impairment | |||||||||||||||
Intangible assets––Developed technology rights(b) | $ | 564 | $ | — | $ | — | $ | 564 | $ | 394 | ||||||||||
Intangible assets––Indefinite-lived Brands(b) | 1,499 | — | — | 1,499 | 109 | |||||||||||||||
Intangible assets––IPR&D(b) | 218 | — | — | 218 | 227 | |||||||||||||||
Intangible assets––Other | — | — | — | — | 73 | |||||||||||||||
Total | $ | 2,281 | $ | — | $ | — | $ | 2,281 | $ | 803 | ||||||||||
(a) | The fair value amount is presented as of the date of impairment, as these assets are not measured at fair value on a recurring basis. See also Note 1E. Basis of Presentation and Significant Accounting Policies: Fair Value. |
(b) | Reflects intangible assets written down to their fair value in 2013. Fair value was determined using the income approach, specifically the multi-period excess earnings method, also known as the discounted cash flow method. We started with a forecast of all the expected net cash flows associated with the asset and then we applied an asset-specific discount rate to arrive at a net present value amount. Some of the more significant estimates and assumptions inherent in this approach include: the amount and timing of the projected net cash flows, which includes the expected impact of competitive, legal and/or regulatory forces on the product and the impact of technological risk associated with IPR&D assets; the discount rate, which seeks to reflect the various risks inherent in the projected cash flows; and the tax rate, which seeks to incorporate the geographic diversity of the projected cash flows. |