NETSOL TECHNOLOGIES INC Goodwill & Intangibles Disclosure
NOTE 13 – GOODWILL
Goodwill represents the excess of the aggregate purchase price over the fair value of the net assets acquired in prior period business combinations. Goodwill was comprised of the following amounts:
| As of | As of | |||||||
| Entity (Segment) | June 30, 2023 | June 30, 2022 | ||||||
| NetSol PK (Asia - Pacific) | $ | 1,166,610 | $ | 1,166,610 | ||||
| NTE (Europe) | 3,471,814 | 3,471,814 | ||||||
| NTA (North America) | 4,664,100 | 4,664,100 | ||||||
| Total | $ | 9,302,524 | $ | 9,302,524 | ||||
The Company tests for goodwill impairment at each reporting unit and recorded an impairment of $214,044 at June 30, 2022. The Company performed the goodwill analysis using an income approach.
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Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2023 | Sep 22, 2023 | Showing above |
| 2021 | Sep 28, 2021 | |
| 2020 | Sep 28, 2020 | |
| 2019 | Sep 23, 2019 | |
| 2018 | Sep 26, 2018 | |
| 2017 | Sep 28, 2017 | |
| 2016 | Sep 15, 2016 | |
About Goodwill & Intangibles Disclosures
Goodwill and intangible asset disclosures reveal the premium paid in acquisitions and how management assesses whether that premium retains its value. Since goodwill is no longer amortized under US GAAP, the annual impairment test is the only mechanism that adjusts carrying values downward — making the assumptions behind that test critically important for investors.
Key signals: a history of goodwill impairments suggests management consistently overpays for acquisitions. Watch the gap between reporting unit fair value and carrying amount — when fair value exceeds carrying amount by less than 10-20%, a small decline in business performance could trigger a write-down. For finite-lived intangibles, examine useful life assumptions across customer relationships, technology, and trade names; aggressive estimates inflate near-term earnings. Compare total intangibles-to-total-assets ratios against peers to assess acquisition dependency. Rising goodwill as a percentage of equity can signal balance sheet fragility.