Goodwill and Other Intangible Assets (Notes)

6 Months Ended

Jun. 30, 2020

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Intangible Assets Disclosure [Text Block]

NOTE 8. GOODWILL AND OTHER INTANGIBLES

Goodwill and indefinite-lived intangible assets are not amortized and are subject to assessment for impairment by applying a fair value based test on an annual basis or more frequently if circumstances indicate a potential impairment. The Company’s annual assessment date is October 1.

During the three months ended June 30, 2020, we performed an interim evaluation of impairment on the goodwill associated with our off-site construction operation Entekra Holdings, LLC (Entekra) due in part to the impacts of the COVID-19 pandemic on this reporting unit. As a result, we recognized a non-cash impairment charge of $5 million for the three and six month periods ended June 30, 2020, within loss on impairment in the Condensed Consolidated Statements of Income. We applied a discounted cash flow model in which cash flows are projected using internal forecasts over future periods, plus a terminal value, and were discounted to present value using a risk-adjusted rate of return. The cash flow forecasts included estimates of growth rates based on our current views of the long-term outlook of the reporting unit and may materially differ from actual results. The discount rate assumptions were based on an assessment of the risk inherent in the future cash flows of each reporting unit using industry, peer group, and company-specific information.

Changes in goodwill and other intangible assets as of June 30, 2020, are provided in the following table:

	Timber licenses1			Goodwill			Developed Technology		Trademark
Beginning balance December 31, 2019	$	38		$	30		$	20	$	3
Acquisition	—			—			—		—
Impairment charge				(5		)
Amortization	(2		)	—			—		—
Ending balance June 30, 2020	$	36		$	25		$	20	$	3

¹Timber licenses are included in Timber and Timberlands on the Condensed Consolidated Balance Sheets.