Annual report pursuant to Section 13 and 15(d)

Note 5 - Goodwill and Other Intangible Assets

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Note 5 - Goodwill and Other Intangible Assets
12 Months Ended
Jun. 30, 2018
Notes to Financial Statements  
Goodwill and Intangible Assets Disclosure [Text Block]
(
5
)
Goodwill and Other Intangible Assets
 
At both
June 30, 2018
and
2017,
we had
$25.4
million of goodwill, and
$19.7
million of other indefinite-lived intangible assets consisting of Ethan Allen trade names, all of which is in our wholesale segment.
 
In the
fourth
quarter of fiscal years
2018,
2017,
and
2016,
the Company performed qualitative assessments of the fair value of the wholesale reporting unit and concluded it is more likely than
not
that the fair value of its goodwill exceeded its carrying value. The fair value of the trade name exceeded its carrying value by a substantial margin in fiscal years
2018,
2017
and
2016.
To calculate fair value of these assets, management relies on estimates and assumptions which by their nature have varying degrees of uncertainty. Management therefore looks for
third
party transactions to provide the best possible support for the assumptions incorporated. Management considers several factors to be significant when estimating fair value including expected financial outlook of the business, changes in the Company’s stock price, the impact of changing market conditions on financial performance and expected future cash flows, and other factors. Deterioration in any of these factors
may
result in a lower fair value assessment, which could lead to impairment of the long-lived assets and goodwill of the Company.