Goodwill |
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Dec. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Goodwill | Goodwill In connection with the change in operating segments in December 2017, the Company reallocated goodwill associated with the operating segments based on their relative fair value. The changes in the carrying amount of goodwill, allocated by operating segments, were as follows (See Note 23):
Goodwill is tested for impairment on an annual basis, or more often if events or changes in circumstances indicate there may be impairment. The Company first assesses qualitative factors to determine whether it is necessary to perform the quantitative impairment test. If determined to be necessary, the quantitative impairment test is used to identify goodwill impairment and measure the amount of a goodwill impairment loss to be recognized (if any). In August of 2017, the Company used the qualitative assessment option. Using this process, the Company first assessed whether it was “more likely than not” that the fair value of a reporting unit was less than its carrying amount. The Company conducted a qualitative assessment of each reporting unit’s fair value as of August 31, 2017. As part of the Company’s qualitative assessment, Management considered the results of the Company’s 2015 quantitative impairment test as well as current market conditions and changes in the carrying amount of the Company’s reporting units that occurred subsequent to the 2015 impairment test. Based on the results of this qualitative assessment, the Company concluded that the fair value of each of the Company’s reporting units continued to exceed their respective carrying amounts and concluded that it was not necessary to conduct the quantitative goodwill impairment test. In September 2017, subsequent to the annual impairment test, Puerto Rico and the Caribbean were hit by hurricanes Irma and Maria, significantly damaging the islands’ infrastructure and communications networks, affecting the ability to transact electronically. As a result, revenues from the Company’s Merchant Acquiring segment and Payment Services - Puerto Rico & Caribbean segment (previously Payment Processing segment) were impacted. Given the severity of the hurricanes, Management analyzed the effects of the event subsequent to its August 31, 2017 analysis. Based on this analysis Management concluded that it was not more likely than not that the fair value of the reporting units was reduced below its carrying amount and that the fair value of each of the Company’s reporting units continued to exceed their respective carrying amounts. In connection with the goodwill reallocation described above, the Company reperformed its qualitative analysis at November 30, 2017, and concluded that it was not more likely than not that the fair value of the reporting units affected by the reallocation was less than its carrying amount. Subsequent to the change in operating segments, the Company performed a quantitative analysis for the reporting units affected by the reallocation that indicated that the estimated fair value of the reporting units exceeded their carrying value. Accordingly, no impairment losses for the period were recognized. The annual impairment test will continue to be in August. For 2016, the Company used a qualitative assessment for the goodwill impairment test |