Purpose

MK Appraisal Group’s impairment testing services are used by our public and private clients to complete their annual goodwill and intangible asset impairment testing. Goodwill must be tested annually at the reporting unit level to comply fully with generally accepted accounting principles (GAAP). Indefinite-lived intangibles also require annual testing.

Independent, Experienced & Knowledgeable Appraisal Assistance

The FASB issued Statement SFAS-142 along with SFAS-141, in June 2001, to change the accounting treatment for acquired goodwill and intangible assets. The changes were dramatic, the rule is complex and the valuation requirements can be daunting. Specifically, SFAS-142 requires that goodwill is no longer amortized post acquisition, but is tested annually for impairment at the ‘reporting unit’ level. The annual goodwill test is a two-step process: the first step requires comparison of a reporting unit’s fair value to its carrying value. Step two is necessary only if step-one fails, and requires an allocation-like appraisal of the reporting unit.

Since 2001, MK Appraisal Group has assisted over 50 companies with their FAS-142 transitional and annual impairment tests, and has steadily increased the number of reporting units and intangible assets appraised annually.