AEA » Topics » 7. Goodwill

This excerpt taken from the AEA 10-K filed Mar 8, 2010.

7. Goodwill

        Goodwill represents the excess cost over the fair value of assets acquired. During the year ended December 31, 2009 the Company made no acquisitions. During the year ended December 31, 2008, the Company completed two acquisitions in the United Kingdom consisting of a total of two centers for an aggregate purchase price, including transaction-related costs, of approximately $0.8 million in cash and an increase in goodwill of approximately $0.7 million. During the year ended December 31, 2007, the Company completed four acquisitions in the United Kingdom consisting of a total of 12 centers and 85 limited licensees for an aggregate purchase price, including transaction-related costs, of approximately $5.5 million in cash and an increase in goodwill of approximately $4.7 million.

        The Company tests its goodwill for impairment annually as of September 30, or if there is a significant change in the business environment. Estimated cash flows and related goodwill are grouped at the reporting unit level. A reporting unit is an operating segment, or under certain circumstances, a component of an operating segment that constitutes a business. When estimated future cash flows are less than the carrying value of the net assets and related goodwill, an impairment test is performed to measure and recognize the amount of the impairment loss, if any. Impairment losses, which are limited to the carrying value of goodwill, represent the excess of the carrying amount of a reporting unit's goodwill over the implied fair value of that goodwill. In determining the estimated future cash flows, the Company, considers current and projected future levels of income, as well as business trends, prospects, market and economic conditions. Impairment tests involve the use of judgments and estimates related to the fair market value of the business operations with which goodwill is associated, taking into consideration both historical operating performance and anticipated financial position and future earnings. The results of the 2007, 2008, and 2009 tests indicated there was no impairment.

        The Company has approximately $4.4 million of goodwill in its United Kingdom operations. As of December 31, 2009, these operations have cumulatively generated negative cash flow and have not reached break-even at the center gross profit level. The Company's expansion efforts in the United Kingdom began during the third quarter of 2007. The goodwill impairment model projects future positive cash flows sufficient to support the goodwill and long-lived asset base. If the United Kingdom

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Advance America, Cash Advance Centers, Inc.

Notes to Consolidated Financial Statements (Continued)

December 31, 2007, 2008, and 2009

7. Goodwill (Continued)


operations continue to generate negative cash flow and do not break-even an impairment charge related to its goodwill is possible.

These excerpts taken from the AEA 10-K filed Mar 4, 2009.

7. Goodwill

        Goodwill represents the excess cost over the fair value of assets acquired. During the year ended December 31, 2008, the Company completed two acquisitions in the United Kingdom consisting of a total of two centers for an aggregate purchase price, including transaction-related costs, of approximately $0.8 million in cash and an increase in goodwill of approximately $0.7 million. During the year ended December 31, 2007, the Company completed four acquisitions in the United Kingdom consisting of a total of 12 centers and 85 limited licensees for an aggregate purchase price, including transaction-related costs, of approximately $5.5 million in cash and an increase in goodwill of approximately $4.7 million.

        The Company tests its goodwill for impairment annually as of September 30, or if there is a significant change in the business environment. In addition, the Company performed an updated goodwill impairment test as of December 31, 2008 as a result of a change in its reporting units. Estimated cash flows and related goodwill are grouped at the reporting unit level. A reporting unit is an operating segment, or under certain circumstances, a component of an operating segment that constitutes a business. When estimated future cash flows are less than the carrying value of the net assets and related goodwill, an impairment test is performed to measure and recognize the amount of the impairment loss, if any. Impairment losses, which are limited to the carrying value of goodwill, represent the excess of the carrying amount of a reporting unit's goodwill over the implied fair value of that goodwill. In determining the estimated future cash flows, the Company, considers current and projected future levels of income, as well as business trends, prospects, market and economic conditions. Impairment tests involve the use of judgments and estimates related to the fair market value of the business operations with which goodwill is associated, taking into consideration both historical operating performance and anticipated financial position and future earnings. The results of the 2006, 2007 and 2008 tests indicated there was no impairment.

        We have approximately $4.0 million of goodwill in our UK operations. As of December 31, 2008, those operations have cumulatively generated negative cash flow and currently have not reached break

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Advance America, Cash Advance Centers, Inc.

Notes to Consolidated Financial Statements (Continued)

December 31, 2006, 2007 and 2008

7. Goodwill (Continued)


even at the center gross profit level. Our expansion efforts in the UK are approximately 15 months old and therefore we are still in the early stages of our build out. The goodwill impairment model projects future positive cash flows sufficient to support the goodwill and long-lived asset base.

7. Goodwill




        Goodwill represents the excess cost over the fair value of assets acquired. During the year ended December 31, 2008, the Company completed two acquisitions in the United Kingdom
consisting of a total of two centers for an aggregate purchase price, including transaction-related costs, of approximately $0.8 million in cash and an increase in goodwill of approximately
$0.7 million. During the year ended December 31, 2007, the Company completed four acquisitions in the United Kingdom consisting of a total of 12 centers and 85 limited licensees for an
aggregate purchase price, including transaction-related costs, of approximately $5.5 million in cash and an increase in goodwill of approximately $4.7 million.



        The
Company tests its goodwill for impairment annually as of September 30, or if there is a significant change in the business environment. In addition, the Company performed an
updated goodwill impairment test as of December 31, 2008 as a result of a change in its reporting units. Estimated cash flows and related goodwill are grouped at the reporting unit level. A
reporting unit is an operating segment, or under certain circumstances, a component of an operating segment that constitutes a business. When estimated future cash flows are less than the carrying
value of the net assets and related goodwill, an impairment test is performed to measure and recognize the amount of the impairment loss, if any. Impairment losses, which are limited to the carrying
value of goodwill, represent the excess of the carrying amount of a reporting unit's goodwill over the implied fair value of that goodwill. In determining the estimated future cash flows, the Company,
considers current and projected future levels of income, as well as business trends, prospects, market and economic conditions. Impairment tests involve the use of judgments and estimates related to
the fair market value of the business operations with which goodwill is associated, taking into consideration both historical operating performance and anticipated financial position and future
earnings. The results of the 2006, 2007 and 2008 tests indicated there was no impairment.




        We
have approximately $4.0 million of goodwill in our UK operations. As of December 31, 2008, those operations have cumulatively generated negative cash flow and currently have
not reached break



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Advance America, Cash Advance Centers, Inc.



Notes to Consolidated Financial Statements (Continued)



December 31, 2006, 2007 and 2008



7. Goodwill (Continued)






even
at the center gross profit level. Our expansion efforts in the UK are approximately 15 months old and therefore we are still in the early stages of our build out. The goodwill impairment model
projects future positive cash flows sufficient to support the goodwill and long-lived asset base.



These excerpts taken from the AEA 10-K filed Feb 29, 2008.

7.  Goodwill

        Goodwill represents the excess cost over the fair value of assets acquired. During the year ended December 31, 2007, the Company completed four acquisitions in the United Kingdom consisting of a total of 12 centers and 85 limited licensees for an aggregate purchase price, including transaction-related costs, of approximately $5.5 million in cash and an increase in goodwill of approximately $4.7 million.

        The Company tests its goodwill for impairment annually or if there is a significant change in the business environment. The results of the 2005, 2006 and 2007 tests indicated there was no impairment.

7.  Goodwill



        Goodwill represents the excess cost over the fair value of assets acquired. During the year ended December 31, 2007, the Company completed four
acquisitions in the United Kingdom consisting of a total of 12 centers and 85 limited licensees for an aggregate purchase price, including transaction-related costs, of approximately
$5.5 million in cash and an increase in goodwill of approximately $4.7 million.




        The
Company tests its goodwill for impairment annually or if there is a significant change in the business environment. The results of the 2005, 2006 and 2007 tests indicated there was
no impairment.



This excerpt taken from the AEA 10-K filed Mar 1, 2007.

7. Goodwill

Goodwill represents the excess cost over the fair value of assets acquired. The Company tests its goodwill for impairment annually or if there is a significant change in the business environment. The results of the 2004, 2005 and 2006 tests indicated there was no impairment.

This excerpt taken from the AEA 10-K filed Mar 16, 2006.

7. Goodwill

        Goodwill represents the excess cost over the fair value of assets acquired and, prior to January 1, 2002, was being amortized over fifteen years under the straight-line method. The Company adopted SFAS No. 142, Goodwill and Other Intangible Assets, as of January 1, 2002. As a result, effective January 1, 2002, the Company no longer recorded approximately $10 million of amortization each year relating to its existing goodwill. The Company tests its goodwill for impairment annually or if there is a significant change in the business environment. The results of the 2003, 2004 and 2005 tests indicated there was no impairment.

"7. Goodwill" elsewhere:

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