Goodwill Impairment

Eton specializes in ASC 350 compliance, providing precise, impartial, and independent goodwill impairment valuations for financial reporting integrity.

Our Goodwill Impairment Process

Day 1
Day 2
Day 8
Day 10
Information Collection
Valuation Modeling and Analysis
Draft Report Delivered; Client Review and Approval
Final Report Delivered
Audit Support

Our Goodwill Impairment Advantage

Companies dealing with complex financial reporting challenges, such as goodwill and intangible assets, face the critical task of ensuring compliance with ASC 350 accounting standards. The stakes are high, as accurate and audit-defensible goodwill impairment valuations are essential for maintaining the integrity of financial reporting. Eton Venture Services specializes in ASC 350 compliance, providing companies with precise, impartial, and independent valuation services to help corporate leaders realize the strategic value of goodwill impairment valuations and make informed decisions about their financial reporting.

Up-to-Date Expertise

Key factors affecting goodwill impairment include the company's financial performance, industry and market conditions, changes in technology and regulatory environment, and the competitive landscape. Eton’s team is always current with the latest updates in regulatory changes and case law.

Tailored Approach

Our team of experienced experts uses a combination of proven methods and proprietary tools to deliver data-driven valuations, considering each company's financial performance, financing history, market trends, and comparable public and private companies.

Proven Track Record

At Eton, we are dedicated to helping you navigate the complexities of goodwill impairment testing and ASC 350 compliance.Join the industry leaders who have already benefited from our exceptional client service and valuation proficiency.

Unparalleled Expertise

Founded by securities lawyers from top law schools / law firms and staffed with finance professionals trained by the Big Four and other prominent financial services firms, Eton brings intellectual and quantitative rigor unmatched by others.

"As a former Gunderson lawyer, I co-founded Eton to bring the precision, efficiency, and the obsessive client service of corporate securities law to business valuation. I'm especially proud that our worldwide team of Big 4 trained CFAs has adopted that client service mantra wholeheartedly.

Our entire focus is on delivering audit-defensible, rigorous, and timely valuations without the inefficient back-and-forth of other firms. Client service is our religion. We always go the extra mile to overdeliver for every client."

Chris Walton, JD
President & CEO
Eton Venture Services
Previously at Gunderson Dettmer / Stanford Law


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How is goodwill impairment tested?

Goodwill impairment testing involves a two-step process. The first step is to compare the fair value of a reporting unit with its carrying value, including goodwill. If the fair value exceeds the carrying value, no impairment exists. If the carrying value exceeds the fair value, the second step is to measure the amount of impairment by comparing the implied fair value of goodwill with its carrying amount.
Goodwill impairment can affect a company’s tax position, as the tax treatment of goodwill impairment may vary depending on the jurisdiction. In some cases, impairment losses may be tax-deductible, reducing taxable income and the company’s tax liability. It is essential to consult with a tax expert to understand the specific tax implications of goodwill impairment in your jurisdiction
Negative goodwill occurs when the fair value of identifiable net assets acquired in a business combination exceeds the purchase price. This situation is rare and usually indicates that the acquirer has negotiated a favorable purchase price. Under current accounting standards, negative goodwill is generally recognized as a gain on the acquirer’s income statement.
Under US GAAP, goodwill is not amortized but instead is tested for impairment annually or more frequently if there are indicators of impairment. Under IFRS, goodwill is also not amortized but is subject to an annual impairment test. Some jurisdictions outside the US may still allow for goodwill amortization; however, this practice is generally not consistent with current international accounting standards.
A company can prepare for a goodwill impairment valuation by gathering relevant financial data, understanding the key drivers of the reporting unit’s value, staying updated on industry trends and market conditions, and working with valuation experts to ensure a comprehensive and accurate assessment of goodwill.

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