Financial Statements
Impairment
A write-down that occurs when an asset is worth less than its recorded accounting value.
Also called: asset impairment, write-down
What it means
Impairment happens when a company determines that an asset, such as goodwill, equipment, or certain intangible assets, is no longer worth the amount carried on the books. The company records a loss to reduce the asset’s value.
Why it matters
Impairments can signal that prior assumptions were too optimistic or that part of the business is underperforming.