Juno 2012 Annual Report Download - page 131

Table of Contents
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


economic trends, or significant underperformance relative to expected historical or projected future results of operations.
—Testing goodwill for impairment involves a two-step quantitative process. However, prior to performing the two-step quantitative
goodwill impairment test, the Company has the option to first assess qualitative factors to determine whether or not it is necessary to perform the two-
step quantitative goodwill impairment test for selected reporting units. If the Company chooses that option, the Company is not required to perform the
two-step quantitative goodwill impairment test unless it has determined, based on the qualitative assessment, that it is more likely than not that the fair
value of a reporting unit is less than its carrying amount. If the two-step quantitative impairment test is required or chosen, the first step of the
impairment test involves comparing the estimated fair value of a reporting unit with its carrying amount, including goodwill. If the estimated fair value
of a reporting unit exceeds its carrying amount, including goodwill, goodwill is considered not to be impaired and no additional steps are necessary. If,
however, the estimated fair value of a reporting unit is less than its carrying amount, including goodwill, then the carrying amount of the goodwill is
compared with its implied fair value, which is determined by deducting the aggregate fair value of the reporting unit's identifiable assets and liabilities
from the fair value of the reporting unit. If the carrying amount of goodwill exceeds the implied fair value of that goodwill, an impairment loss is
recognized in an amount equal to the excess.
The process of estimating the fair value of goodwill is subjective and requires the Company to make estimates that may significantly impact the
outcome of the analyses. The estimated fair value for each reporting unit was determined using a combination of the income approach and the market
approach. Under the income approach, each reporting unit's fair value is estimated based on the discounted cash flow method. The discounted cash flow
method is dependent upon a number of factors, including projections of the amounts and timing of future revenues and cash flows, assumed discount
rates and other assumptions. Under the market approach, using the guideline company method, each reporting unit's fair value was estimated by
multiplying the reporting unit's assessed sustainable level of revenues and normalized earnings before interest, taxes, depreciation, and amortization
("EBITDA") by selected revenue and EBITDA multiples based on market statistics of identified public companies comparable to the respective
reporting unit.
—Testing indefinite-lived intangible assets, other than goodwill, for impairment requires a one-step approach
under ASC 350. The Company tests indefinite-lived intangible assets for impairment on an annual basis, or more frequently, if events occur or
circumstances change that indicate they may be impaired. The fair values of indefinite-lived intangible assets are compared to their respective carrying
amounts and if the carrying amount of indefinite-lived intangible assets exceeds the fair value, an impairment loss is recognized equal to the excess.
The process of estimating the fair value of indefinite-lived intangible assets is subjective and requires the Company to make estimates that may
significantly impact the outcome of the analyses. Such estimates include, but are not limited to, future operating performance and cash flows, royalty
rate, terminal growth rate, and discount rate.
—The Company accounts for identifiable intangible assets and other long-lived assets
in accordance with ASC 360, ,
F-14