How often does Atwell Suites test goodwill and intangible assets with indefinite lives for impairment?
Atwell_Suites Franchise · 2025 FDDAnswer from 2025 FDD Document
The Company accounts for the Agreement in accordance with Accounting Standards Codification (ASC) Topic 350-30, General Intangibles Other than Goodwill. In accordance with ASC 350-30-35-18, indefinite-lived intangible assets are reviewed annually for impairment. The Company has not recognized any impairment losses in respect of the Agreement for the years ended December 31, 2024, 2023, and 2022.
Source: Item 23 — Receipts (FDD pages 99–486)
What This Means (2025 FDD)
According to Atwell Suites's 2025 Franchise Disclosure Document, intangible assets with indefinite lives are reviewed annually for impairment. Specifically, the company follows Accounting Standards Codification (ASC) Topic 350-30-35-18, which mandates this annual review.
This means that Atwell Suites assesses at least once per year whether the value of its intangible assets, such as trademarks, has declined. This review can also be triggered by events or changes in circumstances that suggest the carrying value of these assets may not be recoverable. If the company determines that the carrying amount of an intangible asset exceeds its fair value, it recognizes an impairment loss in its consolidated statements of net income.
Notably, the FDD states that Atwell Suites has not recognized any impairment losses related to the Master License Agreement for the years ended December 31, 2024, 2023, and 2022. This indicates that, at least in recent years, the company's intangible assets have maintained their value according to their accounting practices.