Goodwill

9 Months Ended

Sep. 30, 2021

Goodwill In accordance with US GAAP, the Company tests goodwill for impairment on an annual basis or at an interim period if events or changed circumstances would more likely than not reduce the fair value of a reporting unit below its carrying amount. Under US GAAP, the Company first assesses the qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amounts as a basis for determining if it is necessary to perform a quantitative impairment test. Periodically estimating the fair value of a reporting unit requires significant judgment and often involves the use of significant estimates and assumptions. These estimates and assumptions could have a significant effect on whether or not an impairment charge is recorded and the magnitude of such a charge.

Annual impairment test

During the third quarter of 2021, the Company changed the date of its annual goodwill impairment test from December 31 to July 1. The Company believes the change in goodwill impairment date does not result in a material change in the method of applying the accounting principle. This change provides the Company additional time to complete the annual impairment test of goodwill in advance of our year end reporting. This change does not result in a delay, acceleration, or avoidance of an impairment charge. This change has been applied prospectively as retrospective application is deemed impracticable due to the inability to objectively determine the assumptions and significant estimates used in earlier periods without the benefit of hindsight.

The Company performed its annual impairment test at July 1, 2021 through a quantitative impairment test which involved estimates of future cash flows, discount rates, economic forecast and other assumptions which are then used in the market approach (earnings and / or transactions multiples) and / or income approach (discounted cash flow method). Based on the results of the annual impairment analysis at July 1, 2021, the Company did not recognize a goodwill impairment relating to any of the Company's reporting units.

The following table presents the changes in the Company's goodwill balance by reporting unit for the periods ended September 30, 2021 and December 31, 2020:


		Investment Bank		Cowen Investment Management		Asset Co		Total
	(dollars in thousands)
Beginning balance - December 31, 2019
Goodwill		$	132,487	$	22,705	$	6,321	161,513
Accumulated impairment charges		(9,485)		(7,979)		(6,321)		(23,785)
Net		123,002		14,726		—		137,728

Activity: Year ended December 31, 2020
Recognized goodwill		9,356		—		—		9,356



Goodwill impairment charges		—		—		—		—

Beginning balance: December 31, 2020
Goodwill		141,843		22,705		—		164,548
Accumulated impairment charges		(9,485)		(7,979)		—		(17,464)
Net		132,358		14,726		—		147,084

Activity: Nine months ended September 30, 2021
Recognized goodwill		—		—		—		—
Goodwill impairment charges		—		—		—		—

Ending balance: September 30, 2021
Goodwill		141,843		22,705		—		164,548
Accumulated impairment charges		(9,485)		(7,979)		—		(17,464)
Net		$	132,358	$	14,726	$	—	$	147,084