Company: CCO
Filing Date: 2025-02-24
Form Type: 10-K
Source: 0001334978-25-000008
Chunk: 110

Company: Clear Channel Outdoor Holdings, Inc.
Filing Date: 2025-02-24
Form: 10-K
Item: Item 8
Chunk 110
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•Structures — 3 to 20 years•Buildings and improvements — 10 to 39 years•Furniture and other equipment — 2 to 20 years•Leasehold improvements — the shorter of economic life or lease term (including renewal periods, if applicable)The Company tests property, plant and equipment for impairment when events or circumstances indicate that the carrying value of an asset may not be recoverable. If the carrying value exceeds the undiscounted cash flows expected to be generated by the asset, its carrying value is written down to fair market value.Refer to Note 10 for additional disclosures about the Company's property, plant and equipment.PermitsThe Company’s America segment holds permits that grant the right to operate and maintain advertising structures at specified locations, subject to compliance with local laws and regulations. These permits pertain to land use approvals for billboards located on property the Company owns, leases, manages or holds easements for. Permits are generally renewable annually and transferable with minimal or no fees. However, if a structure is modified (e.g., a change in height or conversion to digital), the Company may need to obtain a new or revised permit.Historical Treatment and Change in Accounting EstimateHistorically, permits primarily related to static assets and were treated as indefinite-lived intangible assets. As such, they were not amortized but tested for impairment at least annually. Impairment was determined by comparing the fair value of the permits at the market level to their carrying amounts. If the carrying amount exceeded the fair value, an impairment loss was recognized.The Company valued permits using the direct valuation method, assuming the assets were developed from scratch rather than acquired as part of a business. This method involved forecasting revenue, expenses and cash flows over a ten-year period for each market, including a “normalized” residual year for perpetual cash flows. The Company engaged a third-party valuation firm to assist in developing the assumptions used to determine the fair value of the permits.In the fourth quarter of 2022, due to changes in circumstances—primarily the acceleration of digitizing its billboard network—the Company concluded that the permits should no longer be considered indefinite-lived. As a result, the Company began amortizing its permits on a straight-line basis over their estimated useful lives, which, at the time of implementation, ranged from 8 to 17 years, depending on the market. This change resulted in amortization expense of $16.1 million in the fourth quarter of 2022, $64.4 million