Company: CL
Filing Date: 2025-02-13
Form Type: 10-K
Source: 0000021665-25-000008
Chunk: 18

Company: COLGATE PALMOLIVE CO
Filing Date: 2025-02-13
Form: 10-K
Item: Item 16
Chunk 18
---
 Sheets as non-current “Other assets.”Property, Plant and EquipmentLand, buildings and machinery and equipment are stated at cost. Depreciation is provided, primarily using the straight-line method, over the estimated useful lives ranging from 3 to 15 years for machinery and equipment and up to 40 years for buildings. Depreciation attributable to manufacturing operations is included in Cost of sales. The remaining component of depreciation is included in Selling, general and administrative expenses.Goodwill and Other IntangiblesGoodwill and indefinite-life intangible assets, such as the Company’s global brands, are subject to impairment tests at least annually or when events or changes in circumstances indicate that an asset may be impaired. In assessing impairment, the Company performs either a quantitative or a qualitative analysis. Determining the fair value of the Company’s reporting units for goodwill and the fair value of its intangible assets requires significant estimates and judgments by management. When a quantitative analysis is performed, the Company generally uses the income approach, which requires several estimates, including future cash flows consistent with management’s strategic plans, sales growth rates and the selection of royalty rates and discount rates. The Company generally engages a third-party valuation firm to assist in determining the fair value of intangible assets acquired in business combinations. As a result of a reporting structure realignment, the Company reallocated the goodwill of a certain reporting unit from the Europe segment to the North America segment. Before and after the reporting structure realignment, the Company completed an assessment indicating no goodwill impairment was required. Refer to Note 13, Segment Information for additional information.Other intangible assets with finite lives, such as local brands and trademarks, customer relationships and non-compete agreements, are amortized over their estimated useful lives, generally ranging from 5 to 40 years. Amortization expense related to intangible assets is included in Other (income) expense, net, which is included in Operating profit.

79

COLGATE-PALMOLIVE COMPANY Notes to Consolidated Financial Statements (continued)(Dollars in Millions Except Share and Per Share Amounts)

Income TaxesThe provision for income taxes is determined using the asset and liability method. Under this method, deferred tax assets and liabilities are recognized based upon the differences between the financial statement and tax bases of assets and liabilities using enacted tax rates that will be in effect at the time such differences are expected to reverse. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred