LabCorp 2014 Annual Report Download - page 67

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65
Step One of the goodwill impairment test includes the estimation of the fair value of each reporting unit as compared to the
book value of the reporting unit. The Company uses a market value approach for determining fair value and utilizes a number of
factors such as publicly available information regarding the market capitalization of the Company as well as operating results,
business plans, and present value techniques. If Step One indicates potential impairment, the second step is performed to measure
the amount of the impairment.
The Company has indefinite-lived assets consisting of acquired Canadian licenses. When a quantitative analysis is considered
necessary for indefinite-lived intangible assets, the Company utilizes an income approach to determine the fair value. It then
compares the carrying value of the indefinite-lived asset to its fair value. Impairment losses are recorded to the extent that the
carrying value of the indefinite-lived intangible asset exceeds its fair value.
There are inherent uncertainties related to the factors described above and judgment related to the impairment assessments
of goodwill and indefinite-lived intangibles. The assumptions underlying the impairment analyses may change in such a manner
that impairment in value may occur in the future. Any such impairment will be recognized in the period in which it becomes
known.