The valuation impact caused by changing times: Why economic obsolescence matters for retail companies

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06/25/2014 by Assurance services
The valuation impact caused by changing times:  Why economic obsolescence matters for retail companies

At a glance

Economic obsolescence can become a significant issue when a company has or is acquiring assets – such as store or restaurant locations – that generate separate identifiable streams of cash flows. This publication discusses factors that typically cause economic obsolescence and the potential impact, including illustrative examples and case studies.

Bob Dylan’s enduring sentiment “The times, they are a changin’” rings true in many ways. For retail or restaurant companies with significant property, plant and equipment (PP&E) assets, changing times can cause economic obsolescence.

The financial implications of this condition are explored in The valuation impact caused by changing times: Why economic obsolescence matters for retail companies.

Download your copy of this publication now. Highlights include:

  • Factors that typically cause economic obsolescence
  • The potential impact of not properly identifying and quantifying economic obsolescence -- especially during an acquisition
  • Considerations for companies that have multiple locations with separate P&L information
  • Illustrative examples and case studies
  • Potential tax impact of economic obsolescence