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This excerpt taken from the KND 10-K filed Mar 11, 2005. Goodwill
In accordance with SFAS No. 142, “Goodwill and Other Intangible Assets,” the Company ceased amortizing goodwill beginning on January 1, 2002. In lieu of amortization, the Company is required to perform an impairment test for goodwill at least annually or more frequently if adverse events or changes in circumstances indicate that the asset may be impaired. The Company performs its annual impairment test at the end of each year. No impairment charge was recorded in each of the last three years in connection with the annual impairment test.
To the extent the Company realizes net deferred tax assets or resolves certain income tax examination contingencies related to the pre-reorganization period, goodwill recorded in connection with fresh-start accounting is reduced accordingly. In 2003, the Company reduced goodwill by $59.1 million related primarily to the recognition of such deferred tax assets. As a result of the reductions recorded in 2003, the fresh-start accounting goodwill was eliminated in full.
F-10
Table of ContentsIndex to Financial StatementsKINDRED HEALTHCARE, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
NOTE 1 – ACCOUNTING POLICIES (Continued)
Goodwill (Continued)
Changes in the carrying amount of goodwill follow (in thousands):
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