Six Flags
Six Flags Analysis of Goodwill
ACCT 6610
Six Flags, Inc. is the largest regional theme park operator in the world. Currently Six Flags operates 18 parks in the US, one in Canada and one in Mexico. In the aggregate, Six Flags’ theme parks offer over 800 rides, including more than 120 roller coasters. The following questions pertain to Six Flags’ goodwill.
To begin, obtain a copy of Six Flags, Inc. December 31, 2008 10-K, which was filed with the SEC March 11, 2009. A link to the report is available via Six Flags’ webpage at www.sixflags.com. Please address the following questions regarding Six Flags’ goodwill. Perform computations for 2007 and 2008 unless otherwise indicated.
1. Examine Six Flags’ auditors’ report on the financial statements. Is there anything noteworthy about this report?
The Company will continue as a going concern…with substantial doubt about its ability to continue as a going concern due to recurring losses, stockholder’s deficit, and substantial liquidity needs. The financial statements don’t include any adjustments that might result from the outcome of this uncertainty.
2. Examine Six Flags’ balance sheet. Compute the percentage of total assets comprised by intangible assets, net of amortization. Are intangible assets a significant component of Six Flags’ total assets?
Intangible assets/total assets: $1,059,486/3,030,845=34.96%
Yes, intangible assets are a significant component of total assets, at almost 35%
3. Refer to part (k) of footnote (1). What is Six Flags’ goodwill balance at December 31, 2008? What proportion of Six Flags’ 2008 intangible assets is attributable to goodwill? Is goodwill a significant component of Six Flags’ total assets? Has Six Flags taken any impairment charges against its goodwill in 2008 or 2007?
Goodwill Dec. 31, 2008 = $1,048.1 million
Int. Assets/goodwill = $1,059,486/$1,048,122 = 101.08%
Yes,
ACCT 6610
Six Flags, Inc. is the largest regional theme park operator in the world. Currently Six Flags operates 18 parks in the US, one in Canada and one in Mexico. In the aggregate, Six Flags’ theme parks offer over 800 rides, including more than 120 roller coasters. The following questions pertain to Six Flags’ goodwill.
To begin, obtain a copy of Six Flags, Inc. December 31, 2008 10-K, which was filed with the SEC March 11, 2009. A link to the report is available via Six Flags’ webpage at www.sixflags.com. Please address the following questions regarding Six Flags’ goodwill. Perform computations for 2007 and 2008 unless otherwise indicated.
1. Examine Six Flags’ auditors’ report on the financial statements. Is there anything noteworthy about this report?
The Company will continue as a going concern…with substantial doubt about its ability to continue as a going concern due to recurring losses, stockholder’s deficit, and substantial liquidity needs. The financial statements don’t include any adjustments that might result from the outcome of this uncertainty.
2. Examine Six Flags’ balance sheet. Compute the percentage of total assets comprised by intangible assets, net of amortization. Are intangible assets a significant component of Six Flags’ total assets?
Intangible assets/total assets: $1,059,486/3,030,845=34.96%
Yes, intangible assets are a significant component of total assets, at almost 35%
3. Refer to part (k) of footnote (1). What is Six Flags’ goodwill balance at December 31, 2008? What proportion of Six Flags’ 2008 intangible assets is attributable to goodwill? Is goodwill a significant component of Six Flags’ total assets? Has Six Flags taken any impairment charges against its goodwill in 2008 or 2007?
Goodwill Dec. 31, 2008 = $1,048.1 million
Int. Assets/goodwill = $1,059,486/$1,048,122 = 101.08%
Yes,