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Valuation Services2016 U.S. Goodwill Impairment Study
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Gary Roland GaryRoland
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Carla Nunes CarlaNunes
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Marianna Todorova MariannaTodorova
The 2016 U.S. Goodwill Impairment Study, prepared in partnership with the Financial Executives Research Foundation, analyzed the general and industry trends of goodwill impairment for over 8,500 U.S. publicly-traded companies.
The report also includes the results of the annual goodwill impairment survey of Financial Executives International (FEI) members who represent both privately-owned and publicly-traded companies.
Highlights from the study include:
- U.S. companies recorded $57 billion of goodwill impairment in 2015, the highest amount since the 2008 financial crisis and more than double the impairment reported during the prior year.
- These record impairment levels occurred despite a robust year for M&A activity in 2015, which resulted in $458 billion of goodwill being added to U.S. companies’ balance sheets.
- For the second year in a row the Energy industry recorded the highest amount of goodwill impairment with $18.2 billion in 2015, followed by Information Technology at $12.9 billion which included the top two impairments of 2015.
- Use of the qualitative goodwill impairment test – known as Step 0 – by public company survey respondents indicates record use, increasing to 59 percent in the current year’s survey from 54 percent in the prior year.
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