Staff members at the Securities and Exchange Commission are easing up on their expectation of preferability letters when companies decide to change the date of their annual goodwill impairment testing.
At a recent national accounting conference, Carlton Tartar, associate chief accountant at the SEC, said the staff has held for more than a decade that a change in the date for the annual goodwill impairment test would be regarded as a change in accounting principle, which is an indicator that the company should get a letter from from its audit firm agreeing that the new date is preferable. The only exception would be cases where goodwill is not material to the reporting entity.
