Impairment of Long-Lived Assets
Duff & Phelps has considerable experience in the application of ASC 360 to assess the recoverability and fair value of long-lived assets, including property, plant and equipment and finite-lived intangible assets. The firm’s long history of intangible asset valuations for business combinations provides it with the foundation to effectively implement this two-step impairment test.
The recoverability of a long-lived asset is assessed in the context of a group of assets with the lowest level of identifiable cash flows over the economic life of the primary asset in the group. Duff & Phelps assists companies in identifying the appropriate grouping of assets and analyzes the projections to assess whether the undiscounted amounts provide for the recoverability of the asset or group.
To the extent that the asset or group is not recoverable an impairment loss is determined based on the difference between the carrying amount and fair value of the asset or group. Duff & Phelps determines the fair value of the asset or group based on appropriate methodologies. The team’s experience in purchase price allocations provides critical insight in apportioning any impairment to the respective assets of the group in accordance with ASC 360.