Company: DMRC
Filing Date: 2025-02-27
Form Type: 10-K
Source: 0001437749-25-005471
Chunk: 116

Company: Digimarc CORP
Filing Date: 2025-02-27
Form: 10-K
Item: Item 1
Chunk 116
---
 reasonably possible or probable as defined in accordance with Accounting Standards Codification (“ASC”) 450 “Contingencies.” If information available prior to the issuance of the financial statements indicates that it is probable that an asset has been impaired or a liability has been incurred at the date of the financial statements, and the amount of the loss, or the range of probable loss can be reasonably estimated, then the loss is accrued and charged to operations. If no accrual is made for a loss contingency because one or both of the conditions pursuant to ASC 450 are not met, but the probability of an adverse outcome is at least reasonably possible, the Company will disclose the nature of the contingency and provide an estimate of the possible loss or range of loss, or state that such an estimate cannot be made.

   Goodwill   The Company tests goodwill for impairment annually and whenever events or changes in circumstances indicate that the carrying value  may exceed the fair value, in accordance with ASC 350 “Intangibles – Goodwill and Other.” The Company operates as a single reporting unit. The Company estimates the fair value of its single reporting unit using a market approach, which takes into account the Company’s market capitalization plus an estimated control premium. In connection with the Company’s annual impairment tests of goodwill as of  June 30, 2024 and 2023, it was concluded that there was no impairment to goodwill as the estimated fair value of the Company’s reporting unit significantly exceeded the carrying value.

   Impairment of Long-Lived Assets   The Company assesses long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset  may not be recoverable, in accordance with ASC 360 “Property, Plant and Equipment.”  

         F-
        9

         DIGIMARC CORPORATION

         NOTES TO CONSOLIDATED FINANCIAL STATEMENTS – (Continued)

         (In thousands, except per share data)

       Recoverability of assets to be held and used is evaluated by a comparison of the carrying amount of the assets to future net undiscounted cash flows expected to be generated by the assets over their remaining useful life. If such assets are considered to be impaired, the impairment would be recognized in operating results at the amount by which the carrying amount of the assets exceeds the fair value of the assets. Fair value is determined based on discounted cash flows, observable market values or appraised values, depending on the nature of the assets.   Assets to be disposed of are reported at the lower of the