Company: SSUP
Filing Date: 2025-03-06
Form Type: 10-K
Source: 0000950170-25-034599
Chunk: 68

Company: SUPERIOR INDUSTRIES INTERNATIONAL INC
Filing Date: 2025-03-06
Form: 10-K
Item: Item 1B
Chunk 68
---
 which are accrued as revenue is recognized. Customer contract prices are generally adjusted quarterly to incorporate these price adjustments. 

Valuation of Long-Lived Assets and Expected Useful Lives

We monitor our long-lived assets for impairment indicators on an on-going basis. If an impairment indicator exists, we test the long-lived asset group for recoverability by comparing the undiscounted cash flows expected to be generated from the long-lived asset 

32

group to its net carrying value. If the net carrying value of an asset group (including the carrying value of liabilities associated with the long-lived assets within the asset group) exceeds the undiscounted cash flows expected to be realized, the asset group is written down to fair value and an impairment loss is recognized. Even if an impairment charge is not recognized, a reassessment of the useful lives may be appropriate based on our assessment of recoverability of these assets.   

Significant judgments and estimates used by management when evaluating long-lived assets for impairment include (i) an assessment as to whether an adverse event or circumstance has triggered the need for a recoverability analysis; (ii) undiscounted future cash flows generated by the asset group; and (iii) the fair value of the asset group. The basis of the recoverability test is our annual budget and long-range plan. This includes a projection of future cash flows based on awarded business and independent market data for vehicle production, which requires us to make significant assumptions and estimates about the extent and timing of future cash flows, and revenue growth rates. While we believe the projections of anticipated future cash flows and related assumptions are reasonable, differences in assumptions underlying these estimates could affect the results of our analysis. The Company’s asset groups consist of the North American and European reportable segments.  

Income Taxes

We recognize deferred tax assets and liabilities on the basis of future tax consequences attributable to temporary differences that exist between the financial statement carrying value of assets and liabilities and their tax reporting values. Future tax benefits are also recognized as deferred tax assets on a taxing jurisdiction basis. Deferred tax assets and liabilities are measured using enacted tax rates that will apply in the years the temporary differences are expected to be recovered or paid. Changes in tax laws or accounting standards and methods may affect recorded deferred taxes in future periods. 

Valuation allowances are recorded to reduce our deferred tax assets to an amount that is more likely than not to be realized. Deferred tax assets are assessed quarterly to determine if a valuation allowance is required or should be adjusted. The ability to realize our deferred tax assets depends on our ability to generate sufficient taxable