Because they depend on management to make assumptions in the qualitative assessment of pertinent events and circumstances and to estimate the fair value of our reporting units and indefinite-lived intangible assets, including estimating future cash flows, our goodwill and other indefinite-lived intangible asset impairment loss calculations contain uncertainties.
These computations include uncertainty since they call for management to make assumptions and apply judgment to estimate economic factors and, if necessary, the fair value of the assets and liabilities of a reporting unit. Furthermore influencing our potential to realize the future cash flows utilized in our fair value estimates are variations in such elements as
economic conditions, our operational performance, our industry and business plans We do not think there is a reasonable chance that the future estimates or assumptions we apply to check for impairment losses on goodwill would show a meaningful change. Our yearly impairment test for goodwill and other indefinite-lived intangible assets produced no recorded
Impairment based on its findings
Based on our above mentioned assessment, we feel that our goodwill and other indefinelived intangible assets are not at danger of damage. On the other hand, should actual results deviate from our estimations or assumptions or show notable variations in any one of these estimates, projections, or assumptions, the fair value of these assets in next measurement
periods may be substantially changed, so influencing our operational results Draft beer is distributed in kegs owned by us and included as a component of Property, equipment, and leasehold improvements in our Consolidated Balance Sheets at cost. These kegs are depreciated over the projected useful life of the keg. We gather a refundable deposit upon
draft beer delivery to the distributor, which shows up as a current liability in our Consolidated Balance Sheets. When the keg comes back to us, the deposit is reimbursed to the distributor. A wholesaler pays a predetermined price and forfeits its deposit for each keg identified to be lost when it cannot account for some of our kegs for which it is liable. We have experienced some loss of kegs and anticipate that some loss will occur in future periods due to the
Significant volume of kegs handled
by each wholesaler and retailer, the similarities between kegs owned by most brewers, and the relatively low deposit collected on each keg when compared with the market value of the keg. We consider this to be a sector-wide problem, and our loss experience is typical of the sector. We periodically employ internal records, A-B records, external third-party records, and historical data to estimate the physical count of kegs held by wholesalers and thereby
estimate forfeited deposits related to lost kegs. A.Deferred tax assets result from unused tax credits and net operating loss carry-through as well as from the tax benefit of amounts expensed for financial reporting purposes but not yet deducted for tax purposes.We have evaluated our sensitivity to some market risks, including interest rate risk related to long-term
debt and financial instruments listed in Cash and Cash equivalents. We signed a $8.0 million notional amount interest rate swap arrangement on January 23, 2014, which expires September 29, 2023, to help to offset the fluctuation of interest payments linked with our variablerate borrowing. It qualifies for cash flow hedge accounting treatment since the interest
Rate swap hedges the fluctuation
of interest payments on variable rate debt with comparable conditions. This interest rate swap lowers our whole interest rate risk and hedges 75% of our outstanding term loan. December 31, 2014 saw us with unhedged variable-rate debt outstanding on our term loan totaling $2.6 million and on our line of credit totaling $3.0 million. Our audits carried out in line with Public Company Accounting Oversight Board (United States) guidelines. Those criteria demand that
we design and execute the audit to get reasonable confidence regarding wuppering the amounts and disclosures in the consolidated financial statements. Along with analyzing the general presentation of the consolidated financial statements, an audit also covers evaluating the accounting concepts applied and major estimates made by management. We think our
audits give a fair foundation for our view. Our financial situation, operating results, or cash flows would not be much affected by a 10% change in the interest rate on our variable-rate debt The nature of our highly liquid Cash and Cash equivalents means that changes in interest rates would not significantly impact the fair value of our Cash or the accompanying
Conclusion
interest income.provinces We periodically review our deferred tax assets to ascertain whether a valuation allowance is needed. We will record a valuation allowance against deferred tax assets, to the extent that their recoverability is decided is not more likely than not. Should we fail to create sufficient taxable income in next years or our assessment that it is more likely than not that some deferred tax assets will be realized is otherwise not accurate; hence, we
could incur charges in future periods to record a valuation allowance on our gross deferred tax asseWe also have audited, in accordance with the standards of the Public Company Accounting Oversight Board United States Craft Brew Alliance Inc.’s internal control over financial reporting as of December based on criteria established in Internal Control Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway
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