The Intent
You want to know whether specific intangible assets still justify their carrying value or whether a write-down is required.
How I Solve It
I apply the 25 Factors to each material intangible asset rather than treating them collectively. Factor #9: Research & Development, Factor #18: Marketing and Brand, Factor #13: Management Capability, and Factor #14: Client Base are often decisive.
The 5 Senses Inspection Report provides observable confirmation that the intangible assets still influence customer behavior, pricing power, and operational performance.
Experience
It is vital because "How do you test intangible assets for impairment?" is not a mechanical calculation. It is a real-world judgment about risk, control, sustainability, and transferability — and that judgment is where 10–15 years of owner-operator and valuation experience, your gut–brain axis, does the heavy lifting.
Why It Is Not Mechanical
On paper, valuation appears formula-driven. In reality, governance rights, risk concentration, growth durability, market conditions, and stakeholder dynamics materially affect value.
Where Experience Changes the Number
Decisions around normalization, premiums, discounts, projections, and defensibility require judgment formed through lived ownership, negotiation, and financial accountability.
Why the Gut–Brain Axis Matters
The brain performs disciplined financial analysis. The gut recognizes unrealistic narratives, hidden leverage, emotional distortions, and deal risk. Together they produce conclusions that withstand scrutiny.
Protecting Financial Lives
The final number affects wealth, control, solvency, tax exposure, and long-term relationships. Requiring 10–15 years of serious hands-on business and valuation experience ensures the answer is fair, defensible, and durable. See my Experience page.
The Result
You obtain an impairment assessment that is defensible, specific, and grounded in how the business actually functions.