Under generally accepted accounting principles (GAAP), long-lived assets
are initially recorded at historical cost, which often equals fair value.
That amount, which is the estimated fair value, is recognized as a liability and capitalized as part of the carrying amount of the long-lived asset
A significant decrease in the market price of a long-lived asset
The only time that goodwill will be part of a long-lived asset
test now is when the asset being tested is also a reporting unit.
A change in balance-sheet components--adding a new liability and capitalized retirement costs as part of the carrying cost of the long-lived asset
, and removing accumulated depreciation of retirement-related costs embedded there.
If only part of the acquired assets are being tested for impairment, some of the goodwill usually is allocated to those assets based on relative fair values of acquired long-lived assets
and identifiable intangibles at acquisition.
34 billion yen in write-downs on long-lived assets
as well as 10.
Although I adhered to AICPA and FASB standards while in practice, in my current mode as an investor in publicly traded securities, I find that the current annual reports reflecting a high percentage of intangible and long-lived assets
cause serious concern as to the true value of the entity.
The project's primary goals were to develop one accounting model, based on the framework established in Statement 121, for disposing long-lived assets
by sale and to address significant implementation issues.
The provision for SFAS 121 impairments, terminated operations, and other asset impairments primarily represents the write-down of goodwill and other long-lived assets
of acquired operations which are not deemed recoverable.
Another benefit should be an increase in consistency and comparability due to the uniformity that SFAS 121 brings to the calculation of the impairment of long-lived assets
Now, the specter of overstated long-lived assets
is attracting the attention of the regulatory agencies and FASB, the results of which are expected to dramatically impact many companies presently considered well capitalized and creditworthy.