Phillips 66 | 2013 | FY | 3


Goodwill and Intangibles

Goodwill
Effective January 1, 2013, we realigned our operating segments and determined that goodwill (which, prior to the realignment, had been assigned fully to our former R&M segment) should now be assigned to three of the realigned operating segments—Midstream, Refining and M&S. We further determined that, for the Midstream segment, Transportation constituted a reporting unit. For the Refining and M&S segments, we determined the goodwill reporting unit was at the operating segment level, due to the economic similarities of the components of those segments. Goodwill was reassigned to the realigned units using a relative fair value approach. See Note 5—Assets Held for Sale or Sold for information on goodwill allocated to assets held for sale or sold.

The carrying amount of goodwill was as follows:
 
 
Millions of Dollars
 
Midstream

 
Refining

 
Marketing and Specialties

 
Total

 
 
 
 
 
 
 
 
Balance at January 1, 2012
$
518

 
1,922

 
892

 
3,332

Goodwill allocated to assets sold

 
(25
)
 

 
(25
)
Tax and other adjustments

 
37

 

 
37

Balance at December 31, 2012
518

 
1,934

 
892

 
3,344

Tax and other adjustments

 
(15
)
 

 
(15
)
Goodwill allocated to assets held-for-sale or sold

 

 
(233
)
 
(233
)
Balance at December 31, 2013
$
518

 
1,919

 
659

 
3,096


Intangible Assets
Information at December 31 on the carrying value of intangible assets follows:
 
 
Millions of Dollars
 
Gross Carrying
Amount
 
2013

 
2012

Indefinite-Lived Intangible Assets
 
 
 
Trade names and trademarks
$
494

 
494

Refinery air and operating permits
200

 
207

 
$
694

 
701




At year-end 2013, our amortized intangible asset balance was $4 million, compared with $23 million at year-end 2012. Amortization expense was not material for 2013 and 2012, and is not expected to be material in future years.

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