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Note 13 - Goodwill

12 Months Ended

Dec. 31, 2021

Notes to Financial Statements

Goodwill Disclosure [Text Block]

13. GOODWILL

Goodwill is comprised of the following.

GOODWILL

(Dollars in Thousands)

	As of December 31,
	2021		2020
AFN	$	109	$	109
JVB		-		-
Goodwill	$	109	$	109

The Company measures its goodwill impairment on an annual basis or when events indicate that goodwill may be impaired. The Company performs its annual impairment tests of AFN goodwill on October 1 of each year; and JVB goodwill on January 1 of each year.

JVB Goodwill

In March 2020, the World Health Organization declared the outbreak of a novel coronavirus (COVID-19) as a pandemic, which continues to spread throughout the United States and worldwide. The spread of COVID-19 has caused significant volatility in domestic and international markets. The volatility of the financial markets experienced since March 2020, as a result of the COVID-19 pandemic has caused the Company to operate JVB at a lower level of leverage than prior to the pandemic. The financial market volatility, as well as the reduction in volumes in the GCF repo and TBA businesses that resulted from COVID-19 required the Company to reassess the goodwill it had recorded related to JVB under the guidance of ASC 350. The Company determined that the fair value of JVB was less than the carrying value (including the goodwill). As a result, the Company recorded an impairment loss of $7,883 for the year ended December 31, 2020. The impairment loss is included in the consolidated statements of operations as impairment of goodwill and is reflected as a component of operating expense.

AFN Goodwill

The annual impairment testing date for the AFN goodwill is October 1. The first testing date following the Merger was October 1, 2010. The Company determined the goodwill was not impaired as of 2021, 2020, and 2019. The Company concluded there was no triggering event for the goodwill related to AFN.