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Managing Directors
Terry J. Allen
Midwest
Stephen J. Bravo
Boston, MA
Michael
A. Crain
Ft. Lauderdale, FL
John R. Gilbert
Great Falls, MT
Steven D. Hyden
Tampa, FL
Robert Lanz
Silicon Valley, CA
Michael J. Mard
Tampa, FL
Michael J. Mattson
Chicago, IL
John J. Mayerhofer
Oakland, CA
Ralph
Ostermueller
St. Louis, MO
Charles H. Preston
Los Angeles, CA
James S. Rigby
Los Angeles, CA
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Founding Member
Financial
Consulting
Group, L.C.
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Required
Disclosures
FASB
has illustrated the Disclosures required for:
- Acquired Intangible
Assets
- Goodwill
- Goodwill
and other Intangible Assets – adoption of
Statement 142
Below you will find the
illustrative Disclosure examples provided by the
Financial Accounting Standard Board.
Disclosure Example #1
Note B: Acquired Intangible Assets
As of December 31, 20X3
($000s)
Gross Carrying
Accumulated
Amount
Amortization
Amortized intangible assets
Trademark
$ 1,078
$ (66)
Unpatented technology
475
(380)
Other
90
(30)
Total
$ 1,643
$ (476)
======
======
Unamortized intangible assets
Broadcast licenses
$ 1,400
-
Trademark
600
-
Total
$ 2,000
-
======
Aggregate Amortization Expense:
For year ended 12/31/X3
-
$ 319
Estimated Amortization Expense:
For year ended 12/31/X4
-
$ 199
For year ended 12/31/X5
-
74
For year ended 12/31/X6
-
74
For year ended 12/31/X7
-
64
For year ended 12/31/X8
-
54
Disclosure Example #2
Note C: Goodwill
The changes in the carrying amount of goodwill for the year ended December 31, 20X3, are as follows:
($000s)
Technology
Communications
Segment
Segment
Total
Balance as of
January 1, 20X3
$ 1,413
$
904
$ 2,317
Goodwill acquired
during year
189
115
304
Impairment losses
-
(46)
(46)
Goodwill written off related
to sale of business unit
(484)
-
(484)
Balance as of
December 31, 20X3
$ 1,118
$
973
$ 2,091
======
=====
======
The Communications segment is tested for impairment in the third quarter, after the annual forecasting process. Due to an increase in competition in the Texas and Louisiana cable industry, operating profits and cash flows were lower than expected in the fourth quarter of 20X2 and the first and second quarters of 20X3. Based on that trend, the earnings forecast for the next five years was revised. In September 20X3, a goodwill impairment loss of $46 was recognized in the Communications reporting unit. The fair value of that reporting unit was estimated using the expected present value of future cash flows.
Disclosure Example #3
Note D: Goodwill and Other Intangible Assets - Adoption of Statement 142
For the Year Ended December
31
($000s except for
earnings-
per-share amounts)
20X2
20X1
20X0
Reported net income
$
1,223 $
1,450
$ 1,360
Add back: Goodwill amortization
-
40
40
Add back: Trademark amortization
-
20
20
Adjust: Copyright amortization
-
3
3
Adjusted net income
$
1,223 $
1,513
$ 1,423
======
====== ======
Basic earnings per share:
Reported net income
$
2.45
$
2.90
$ 2.72
Goodwill amortization
-
0.08
0.08
Trademark amortization
-
0.04
0.04
Copyright amortization
-
0.01
0.01
Adjusted net income
$
2.45
$
3.03
$ 2.85
======
===== =====
Diluted earnings per share:
Reported net income
$
2.23
$
2.64
$ 2.47
Goodwill amortization
-
0.07
0.07
Trademark amortization
-
0.04
0.04
Copyright amortization
-
0.01
0.01
Adjusted net income
$
2.23
$
2.76
$ 2.59
=====
=====
=====
See Paragraph(s) 51 - 58 of SFAS
141.
See Paragraph(s) 44 - 47 and 60 - 61 of SFAS 142.
See Appendix C of SFAS 142.
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