TS Insights: Determining when, what, and how much to impair a long-lived asset

Financial reporting on impairments
Download Determining when, what, and how much to impair a long-lived asset

Recent indicators such as ongoing and forecasted operating losses and downsizing efforts have been leading many companies to focus on asset values and whether there might be associated impairment charges. As a result, many are going beyond their annual testing for goodwill impairment to undertake processes they may not have needed during historic periods of growth and stability, such as testing long-lived assets for impairment.

For some, the new processes can be particularly subjective and challenging to apply in practice. Understanding what to expect and thinking about how to address the accounting and valuation issues will enable companies to plan ahead and potentially avoid costly, last-minute surprises.