Thrifty Car Rental 2008 Annual Report Download - page 64

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7. PROPERTY AND EQUIPMENT
Major classes of property and equipment consist of the following:
2008 2007
Land 12,135$ 12,240$
Buildings and improvements 21,069 22,575
Furniture and equipment 93,008 93,905
Leasehold improvements 125,589 129,542
Construction in progress 7,759 13,876
259,560 272,138
Less accumulated depreciation and amortization (155,118) (149,835)
104,442$ 122,303$
December 31,
(In Thousands)
During 2008, the Company completed its long-lived assets impairment testing under SFAS No. 144,
“Accounting for the Impairment or Disposal of Long-Lived Assets”, and, based on projections for
future cash flows, concluded that substantially all of the long-lived assets in its Canadian operation
were impaired. The Company recorded a $5.9 million non-cash charge (pre-tax) related to this
impairment.
8. INTANGIBLE ASSETS
2008 2007
Amortized intangible assets
Software and other intangible assets 78,663$ 77,888$
Less accumulated amortization (48,885) (43,312)
29,778 34,576
Unamortized intangible assets
Reacquired franchise rights - 69,201
Total intangible assets 29,778$ 103,777$
December 31,
(In Thousands)
The Company establishes unamortized separately identifiable intangible assets, referred to as
reacquired franchise rights, when acquiring locations from franchisees. Intangible assets with
indefinite useful lives, such as reacquired franchise rights, are not amortized, but are subject to
impairment testing annually or more frequently if events and circumstances indicate there may be
impairment. Intangible assets with finite useful lives are amortized over their respective useful lives.
In March 2008, based on the operating environment and in conjunction with reassessment of
goodwill impairment (see discussion under Note 9 below), the Company reassessed its reacquired
franchise rights for impairment. Impairment testing under SFAS No. 142, “Goodwill and Other
Intangible Assets” (“SFAS No. 142”) also applies to reacquired franchise rights. Based on the
assessment at March 31, 2008, management concluded that reacquired franchise rights were
impaired, and the Company recorded a $69.0 million non-cash charge (pre-tax) related to the
impairment of the entire reacquired franchise rights ($42.2 million after-tax).
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