Company: IR
Filing Date: 2025-02-19
Form Type: 10-K
Source: 0001628280-25-006391
Chunk: 40

Company: Ingersoll Rand Inc.
Filing Date: 2025-02-19
Form: 10-K
Item: Item 7
Chunk 40
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 also considering quantitative factors such as revenue growth, profitability and total assets.

No goodwill impairments were recorded in 2024 and the cushion of all reporting units was at least 60%, with the exception of two reporting units in our Precision and Science Technologies segment. These two reporting units have goodwill totaling approximately $1.1 billion and limited cushions ranging from 5% to 16%. The limited cushions are due to the fair values assigned from the recent ILC Dover acquisition. Changes in forecast estimates or the application of alternative assumptions could produce significantly different results. The discount rates (9.0% to 14.5%), terminal growth rates (2.5% to 3.0%), and EBITDA multiples are the most sensitive assumptions. A material non-cash impairment of goodwill could result from a number of circumstances, including different assumptions used in determining the fair value of these reporting units or changes to customer spending priorities. 

We test intangible assets with indefinite lives for impairment annually utilizing a discounted cash flow valuation referred to as the relief from royalty method. We estimated forecasted revenues for a period of five years with discount rates ranging from 8.0% to 10.5%, terminal growth rates of 2.5% to 3.5%, and royalty rates ranging from 0.5% to 4.0%. There were no impairments identified or recognized during the year ended December 31, 2024. An indefinite lived intangible held in the Precision and Science Technologies segment and recently acquired in the ILC Dover acquisition, with a carrying value of approximately $208 million had a cushion of approximately 6%. Changes in forecasted revenues or any of the other assumptions mentioned above could result in a material non-cash impairment charge in a future period.

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We review identified intangible assets with defined useful lives and subject to amortization for impairment whenever events or changes in circumstances indicate that the related carrying amounts may not be recoverable. Determining whether an impairment loss occurred requires comparing the carrying amount to the sum of undiscounted cash flows expected to be generated by the asset.

Also see Note 9 “Goodwill and Other Intangible Assets” to our audited consolidated financial statements included elsewhere in this Form 10-K.

Income Taxes

Our annual tax rate is based on our income, statutory tax rates and tax planning opportunities available to us in the various jurisdictions in which we operate. Tax laws are complex and subject to different interpretations by the taxpayer and respective governmental taxing authorities. Significant judgment is required in determining our