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Impairment Of Long-Lived Assets And Goodwill
3 Months Ended
Nov. 30, 2011
Impairment Of Long-Lived Assets And Goodwill [Abstract]  
Impairment Of Long-Lived Assets And Goodwill

5. Impairment of Long-Lived Assets and Goodwill

Long-Lived Assets

     The Company assesses long-lived assets used in operations for possible impairment when events and circumstances indicate that such assets might be impaired and the undiscounted cash flows estimated to be generated by those assets are less than their carrying amount. No material impairment charges were recorded in the first quarter of fiscal year 2012 or in the same period last year. Projecting the cash flows for the impairment analysis involves significant estimates with regard to the performance of each drive-in, and it is reasonably possible that the estimates of cash flows may change in the near term resulting in the need to write down operating assets to fair value.

Goodwill

     The Company is required to test goodwill for impairment on an annual basis and between annual tests whenever indications of impairment arise. Cash flows from store operations, which are monitored between annual impairment tests to track potential changes in the fair value of the Company Drive-in reporting unit, have declined since the annual impairment test that was performed in the fourth quarter of fiscal year 2011. The Company could be required to evaluate the recoverability of goodwill prior to the next annual assessment if cash flows from store operations decline significantly or as a result of allocating goodwill to Company Drive-Ins that may be sold in the future. Such events could result in goodwill impairment charges in the future. As of November 30, 2011, the Company had $81.6 million of goodwill, of which $75.6 million was attributable to the Company Drive-Ins segment and $6.0 million was attributable to the Franchise Operations segment. For more information regarding the Company's goodwill and other intangible assets information, see note 1 - Summary of Significant Accounting Policies in the Notes to Consolidated Financial Statements in the Company's Annual Report on Form 10-K for the year ended August 31, 2011.