The Case for an Indefinite Useful Life for the Customer Relationships Asset
While the FASB (Financial Accounting Standards Board) made some significant improvements in the treatment of intangible assets and goodwill when it issued FAS 141 and 142, there remain a couple significant flaws, particularly with respect to the customer relationships asset. This article describes in a straightforward manner where the rough areas lie, what the valuation implications are, and how the defects can be fixed.
Contributor Notes
Christopher Waldorf is currently pursuing a Masters in Industrial Engineering at Georgia Tech. He was the Manager of Valuation and Analysis for Roper Industries, a publicly-traded, diversified manufacturing company. Prior to that, he was a Senior Manager with Deloitte & Touche in their Corporate Finance and Valuation Group. He earned his undergraduate degree at Tufts University and his MBA at New York University.