Juno 2013 Annual Report Download - page 46

Table of Contents
The determination of whether or not goodwill is impaired involves a significant level of judgment in the assumptions underlying the approaches
used to determine the estimated fair value of our reporting units. We believe our analysis included sufficient tolerance for sensitivity in key assumptions.
We believe the assumptions and rates used in our impairment assessment are reasonable, but they are judgmental, and variations in any assumptions
could result in materially different calculations of fair value.

We account for identifiable intangible assets and other long-lived assets in accordance with ASC 360, , which
addresses financial accounting and reporting for the impairment and disposition of identifiable intangible assets and other long-lived assets. Intangible
assets acquired in a business combination are initially recorded at management's estimate of their fair values. We evaluate the recoverability of
identifiable intangible assets and other long-lived assets for impairment when events occur or circumstances change that would indicate that the carrying
amount of an asset may not be recoverable. Events or circumstances that may indicate that an asset is impaired include, but are not limited to, significant
decreases in the market value of an asset, significant underperformance relative to expected historical or projected future operating results, a change in
the extent or manner in which an asset is used, shifts in technology, loss of key management or other personnel, significant negative industry or
economic trends, changes in our operating model or strategy, and competitive forces. In determining if an impairment exists, we estimate the
undiscounted cash flows to be generated from the use and ultimate disposition of these assets. If an impairment is indicated based on a comparison of
the assets' carrying amounts and the undiscounted cash flows, the impairment loss is measured as the amount by which the carrying amounts of the
assets exceed the respective fair values of the assets. Definite-lived intangible assets are amortized on either a straight-line basis or an accelerated basis
over their estimated useful lives, ranging from two to ten years. Our identifiable intangible assets were acquired primarily in connection with business
combinations.
The process of evaluating the potential impairment of long-lived intangible assets is subjective and requires significant judgment on matters such
as, but not limited to, the asset group to be tested for recoverability. We are also required 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, cost of capital, terminal values, and remaining
economic lives of assets.
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Member redemption liability for loyalty marketing service points represents the estimated costs associated with the obligation of MyPoints to
redeem outstanding points accumulated by its loyalty marketing service members, less an allowance for points expected to expire prior to redemption.
The estimated cost of points is primarily presented in cost of revenues, except for the portion related to member acquisition activities, internal marketing
surveys and other non-revenue generating activities, which are presented in sales and marketing expenses. The member redemption liability is
recognized when members earn points, less an allowance for points expected to expire, and is reduced when members redeem accumulated points upon
reaching required redemption thresholds or when points expire prior to redemption.
MyPoints members may redeem points for third-party gift cards and other rewards. Members earn points when they respond to direct marketing
offers delivered by MyPoints, purchase goods or services from advertisers, engage in certain promotional campaigns of advertisers, or engage in other
specified activities.
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