Goldman Sachs 2012 Annual Report Download - page 166

Notes to Consolidated Financial Statements
Impairments
As a result of a decline in the market conditions in which
certain of the firm’s consolidated investments operate,
during 2012 and 2011, the firm tested certain property,
leasehold improvements and equipment, intangible assets
and other assets for impairment in accordance with ASC
360. The carrying value of these assets exceeded the
projected undiscounted cash flows over the estimated
remaining useful lives of these assets; as such, the firm
determined the assets were impaired and recorded
impairment losses. In addition, the firm sold assets during
2012 and 2011 and recognized impairment losses prior to
the sale of these assets. These impairment losses represented
the excess of the carrying values of these assets over their
estimated fair values, which are primarily level 3
measurements, using a combination of discounted cash
flow analyses and relative value analyses, including the
estimated cash flows expected to be received from the
disposition of certain of these assets.
The impairment losses were approximately $400 million
during the year ended December 2012, substantially all of
which were included in “Depreciation and amortization”
within the firm’s Investing & Lending segment. Impairment
losses related to property, leasehold improvements and
equipment were approximately $250 million, including
approximately $160 million attributable to commodity-
related assets. Impairment losses related to intangible and
other assets were approximately $150 million, including
approximately $80 million attributable to commodity-
related assets and approximately $40 million attributable
to the firm’s New York Stock Exchange (NYSE)
Designated Market Maker (DMM) rights.
The impairment losses were approximately $440 million
during the year ended December 2011 (approximately
$220 million related to assets classified as held for sale,
primarily related to Litton Loan Servicing LP (Litton),
approximately $120 million related to commodity-related
intangible assets and approximately $100 million related to
property, leasehold improvements and equipment), all of
which were included in “Depreciation and amortization.”
The impairment losses related to commodity-related
intangible assets and property, leasehold improvements and
equipment were included in the firm’s Investing & Lending
segment and the impairment losses related to assets
classified as held for sale were principally included in the
firm’s Institutional Client Services segment. Litton was sold
in the third quarter of 2011 and the firm received total
consideration that approximated the firm’s adjusted
carrying value for Litton. See Note 18 for further
information about the sale of Litton.
164 Goldman Sachs 2012 Annual Report