Company: EVC
Filing Date: 2025-03-06
Form Type: 10-K
Source: 0000950170-25-034661
Chunk: 13

Company: ENTRAVISION COMMUNICATIONS CORP
Filing Date: 2025-03-06
Form: 10-K
Item: Item 8
Chunk 13
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35.4 million during the first quarter of 2024, due to a triggering event identified related to the then digital reporting unit, and an impairment charge of $43.3 million during the fourth quarter of 2024, as a result of its annual quantitative assessment of the fair value of the media reporting unit.

We identified goodwill impairment as a critical audit matter because the determination of fair value of the reporting unit involves significant assumptions made by management, including the revenue projections, profit margin projections, and discount rates.  This required a high degree of auditor judgment and an increased extent of effort, including the need to involve our fair value specialists.

How the Critical Audit Matter Was Addressed in the Audit

Our audit procedures related to the goodwill impairment analysis included the following, among others:

•We tested the effectiveness of controls over management’s goodwill impairment evaluation, including those over the determination of the fair value of each reporting unit such as controls related to management’s revenue projections, and other valuation inputs (e.g. method, discount rate, long term growth rates). 

•We evaluated the reasonableness of management's revenue projections and profit margin projections by comparing the projections to historical results, third-party industry forecasts, and internal communications to management and board of directors. 

With the assistance of our fair value specialists, we:

•Evaluated the reasonableness of the valuation methodology, and the weighting applied to value indications from different valuation techniques.

•Tested the source information underlying the determination of the weighted average cost of capital rate and the mathematical accuracy of the calculation.

•Developed a range of independent estimates and compared those to the weighted average cost of capital rate selected by management.

/s/ DELOITTE & TOUCHE LLP

    Los Angeles, California

    March 6, 2025 We have served as the Company's auditor since 2022.

F-3

ENTRAVISION COMMUNICATIONS CORPORATION 

CONSOLIDATED BALANCE SHEETS 

(In thousands, except share and per share data)

    December 31,

    December 31,

    2024

    2023

    ASSETS

    Current assets

    Cash and cash equivalents
     
    $
    95,914

    $
    67,398

    Marketable securities

    4,694

    13,172

    Restricted cash

    786

    770

    Trade receivables (including related parties of $3,556 and $10,051), net of allowance for doubtful