Facebook Inc. (FB)

Long-Lived Assets, Including Goodwill and Other Acquired Intangible Assets

Facebook evaluates the recoverability of property and equipment and finite-lived intangible assets for possible impairment whenever events or circumstances indicate that the carrying amount of such assets may not be recoverable. The evaluation is performed at the lowest level for which identifiable cash flows are largely independent of the cash flows of other assets and liabilities. Recoverability of these assets is measured by a comparison of the carrying amounts to the future undiscounted cash flows the assets are expected to generate. If such review indicates that the carrying amount of property and equipment and intangible assets is not recoverable, the carrying amount of such assets is reduced to fair value. Facebook has not recorded any significant impairment charges during the years presented.

Facebook reviews goodwill for impairment at least annually or more frequently if events or changes in circumstances would more likely than not reduce the fair value of the single reporting unit below its carrying value. As of December 31, 2017, no impairment of goodwill has been identified.

Acquired finite-lived intangible assets are amortized on a straight-line basis over the estimated useful lives of the assets. Facebook routinely reviews the remaining estimated useful lives of property and equipment and finite-lived intangible assets. If Facebook reduces the estimated useful life assumption for any asset, the remaining unamortized balance is amortized or depreciated over the revised estimated useful life.

Source: Facebook Inc., Annual Report

Facebook Inc., Statement of Financial Position, Goodwill and Intangible Assets

USD $ in millions

Source: Based on data from Facebook Inc. Annual Reports

Item	Description	The company
Intangible assets	Sum of the carrying amounts of all intangible assets, excluding goodwill, as of the balance sheet date, net of accumulated amortization and impairment charges.	Facebook Inc.'s intangible assets declined from 2015 to 2016 and from 2016 to 2017.
Goodwill	Carrying amount as of the balance sheet date, which is the cumulative amount paid and (if applicable) the fair value of any noncontrolling interest in the acquiree, adjusted for any amortization recognized prior to the adoption of any changes in generally accepted accounting principles (as applicable) and for any impairment charges, in excess of the fair value of net assets acquired in one or more business combination transactions.	Facebook Inc.'s goodwill increased from 2015 to 2016 and from 2016 to 2017.
Goodwill and intangible assets	Sum of the carrying amounts of all intangible assets, including goodwill, as of the balance sheet date, net of accumulated amortization and impairment charges.	Facebook Inc.'s goodwill and intangible assets declined from 2015 to 2016 and from 2016 to 2017.

Facebook Inc., adjustments to financial data

USD $ in millions

Facebook Inc., adjusted ratios

Ratio	Description	The company
Adjusted total asset turnover	An activity ratio calculated as total revenue divided by adjusted total assets.	Facebook Inc.'s adjusted total asset turnover improved from 2015 to 2016 and from 2016 to 2017.
Adjusted financial leverage	A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity. Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income.	Facebook Inc.'s adjusted financial leverage declined from 2015 to 2016 but then increased from 2016 to 2017 not reaching 2015 level.
Adjusted ROE	A profitability ratio calculated as net income divided by adjusted shareholders' equity.	Facebook Inc.'s adjusted ROE improved from 2015 to 2016 and from 2016 to 2017.
Adjusted ROA	A profitability ratio calculated as net income divided by adjusted total assets.	Facebook Inc.'s adjusted ROA improved from 2015 to 2016 and from 2016 to 2017.

2017 Calculations

Ratio	Description	The company
Adjusted total asset turnover	An activity ratio calculated as total revenue divided by adjusted total assets.	Facebook Inc.'s adjusted total asset turnover improved from 2015 to 2016 and from 2016 to 2017.

2017 Calculations

Ratio	Description	The company
Adjusted financial leverage	A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity. Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income.	Facebook Inc.'s adjusted financial leverage declined from 2015 to 2016 but then increased from 2016 to 2017 not reaching 2015 level.

2017 Calculations

Ratio	Description	The company
Adjusted ROE	A profitability ratio calculated as net income divided by adjusted shareholders' equity.	Facebook Inc.'s adjusted ROE improved from 2015 to 2016 and from 2016 to 2017.

2017 Calculations

Ratio	Description	The company
Adjusted ROA	A profitability ratio calculated as net income divided by adjusted total assets.	Facebook Inc.'s adjusted ROA improved from 2015 to 2016 and from 2016 to 2017.