Financial Reporting Valuation

Impairment Testing

Mercer Capital helps clients resolve financial reporting valuation issues, including goodwill impairment testing and the testing of long-lived intangible assets for impairment.

ASC 350, Intangibles – Goodwill and Other requires that entities test goodwill for potential impairment at least annually, or more often in the case of certain triggering events. While some private companies have elected to amortize goodwill under ASU 2017-04, these companies are still subject to the interim testing requirements if certain triggering events have occurred.

Mercer Capital also provides impairment testing services for indefinite-lived and amortizable intangible assets in accordance with ASC 350 and ASC 360. For our international clients, Mercer Capital offers impairment testing services pursuant to IAS 36 and IAS 38.

Our professionals are nationally recognized as leaders in the valuation industry and hold the most rigorous credentialing designations including the CEIV, CFA, ASA, and CPA, among others, which are representative of the highest standards in the valuation and accounting industries. Mercer Capital has the institutional capability to tackle even the most uncommon or complex fair value issues. We understand the sensitivity of financial reporting timing needs and meet your deadline on time, every time.

Research and Resources

Goodwill Impairment Testing in Uncertain Times

Many companies just completed an impairment test as of year-end 2019. But the unprecedented events precipitated by the COVID-19 pandemic now raise questions about whether an interim goodwill impairment test is warranted. In this article, we discuss whether you need an interim impairment test and how an impairment test works. We also identify areas that are likely to draw additional scrutiny from auditors and regulators.

Goodwill Impairment: 2018 Financial Reporting Update

Mercer Capital’s financial reporting update focuses on the topic of goodwill impairment and includes five articles of interest to public and private companies.

What is the Order of Testing for Impairment?

When testing the goodwill of a reporting unit for impairment, the order of operations matters. Because the units themselves may contain assets subject to impairment testing, it is important to first reflect accurate carrying values for those assets before testing the goodwill of the unit overall.

Industry Considerations for Step Zero: Qualitative Assessments

Step Zero provides the opportunity to perform a preliminary qualitative analysis to determine the necessity of performing the traditional two step goodwill impairment test and can lead to a simpler, more efficient impairment testing process.

Professionals

Travis W. Harms, CFA, CPA/ABV

President

Lucas Parris, CFA, ASA-BV/IA

Senior Vice President

J. David Smith, ASA, CFA

Senior Vice President

Sujan Rajbhandary, CFA, ABV

Senior Vice President

Samantha L. Albert, ASA, ABV

Vice President

Zachary M. Barber, CPA/ABV

Vice President