Company: KELYB
Filing Date: 2025-02-13
Form Type: 10-K
Source: 0000055135-25-000007
Chunk: 8

Company: KELLY SERVICES INC
Filing Date: 2025-02-13
Form: 10-K
Item: Item 8
Chunk 8
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 the lower of the carrying amount or estimated fair value less cost to sell. We test goodwill for impairment annually and whenever events or circumstances make it more likely than not that an impairment may have occurred.  Generally accepted accounting principles require that goodwill be tested for impairment at a reporting unit level.  For segments with a goodwill balance, we have determined that our reporting units are the same as our operating and reportable segments based on our organizational structure or one level below our operating segments (the component level).We may first use a qualitative assessment ("step zero") for the annual impairment test if we have determined that it is more likely than not that the fair value for one or more reporting units is greater than their carrying value.  The step zero analysis includes making judgments and assessments to determine whether any events or circumstances have occurred that makes it more likely than not that the fair value of a reporting unit is less than its carrying amount.  In conducting the qualitative assessment, we assess the totality of relevant events and circumstances that affect the fair value or carrying value of the reporting unit.  Such events and circumstances may include macroeconomic conditions, industry and market conditions, cost factors, overall financial performance, entity-specific events and events affecting a reporting unit.  If we elect to forgo the qualitative assessment for a reporting unit, goodwill is tested for impairment by comparing the estimated fair value of a reporting unit to its carrying value ("step one").  If the estimated fair value of a reporting unit exceeds the carrying value of the net assets assigned to a reporting unit, goodwill is not considered impaired and no further testing is required.  If the carrying value of the net assets assigned to a reporting unit exceeds the estimated fair value of a reporting unit, goodwill is deemed impaired and is written down to the extent of the difference.For the step one quantitative test, we determine the fair value of our reporting units using the income approach.  Under the income approach, estimated fair value is determined based on estimated future cash flows discounted by an estimated market participant weighted-average cost of capital, which reflects the overall level of inherent risk of the reporting unit being measured.  Estimated future cash flows are based on our internal projection model and reflects management’s outlook for the reporting unit.  Assumptions and estimates about future cash flows and discount rates are complex and often subjective.  They can be affected by a variety of factors, including external factors such as industry and economic trends, and internal factors such as changes in our business strategy and our internal forecasts.  Our analysis used the following significant assumptions: expected