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Goodwill Impairment Analysis for AMMRC Inc. Prepared by: Date: 07/28/2025 A. Summary of Goodwill Impairment Guidance under ASC 350 The Financial Accounting Standards Board (FASB) provides authoritative guidance on goodwill impairment in ASC Topic 350 – Intangibles – Goodwill and Other. Below are the relevant treatments based on various factors: 1. When a Company Has Similar Economic Characteristics Under ASC to 35-38, when reporting units have similar economic characteristics, entities may aggregate those units for testing purposes if they are managed together, share similar economic risks, and operate in similar industries or markets. 2. When a Company Does Not Have Similar Economic Characteristics According to ASC , companies must perform impairment testing separately for each reporting unit that does not meet the aggregation criteria. This ensures an accurate reflection of the economic condition of each distinct unit. 3. Goodwill Impairment for a Public Company Public companies follow a two-step impairment process (per ASC 350-20-35 3C). Step 1 compares the fair value of the reporting unit with its carrying amount. If the fair value is less, Step 2 measures the impairment by comparing the implied fair value of goodwill with its carrying amount. 4. Goodwill Impairment for a Private Company Under ASC and the Private Company Council (PCC) alternative, private companies may amortize goodwill over 10 years (or a shorter useful life) and may perform a simplified one-step test only when a triggering event occurs. 5. When a Company Elects the Accounting Alternative Per ASC to 35-66, companies that elect the alternative amortize goodwill over 10 years and bypass annual impairment testing unless a triggering event suggests impairment. 6. When a Company Does Not Elect the Accounting Alternative The company must test goodwill annually and when a triggering event occurs (ASC to 35-30). It involves comparing the fair value of a reporting unit to its carrying value and determining the amount of impairment. 7. When a Triggering Event Occurs If a triggering event (e.g., decline in market value, economic downturn) is identified, the company must assess goodwill for impairment as of the date of the event, per ASC C. 8. When No Triggering Event Occurs In the absence of triggering events, public companies perform annual goodwill impairment tests. Private companies that elected the PCC alternative do not perform tests without a triggering event (ASC A).