The Financial Reporting Blog

A weekly update on financial reporting topics curated by Mercer Capital’s Financial Reporting Valuation professionals.

Expectations for Step 0 Impairment Testing

The so called “Step 0” impairment test was expected to save firms time and money when it came to testing and reporting their goodwill balances. According to Duff & Phelps, 69% of private companies and 81% of public companies surveyed anticipated applying the Step 0 qualitative test in 2011. One year later, 52% of private companies and 43% of public companies reported actually using Step 0. So what are the issues that keep companies from using the Step 0 qualitative test as expected?

Cheap Debt Driving Up LBO Valuations

There’s an interesting phenomenon going on in the M&A markets so far in 2013. Valuations are pushing higher despite an overall slowdown in deal-making activity and higher proportions of equity relative to pre-financial crisis levels.

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