We account for goodwill in accordance with FASB ASC Topic 350 “.” We do not amortize goodwill, but rather test for impairment annually or more frequently if events or circumstances indicate that an asset may be impaired. We perform our annual impairment testing during the fourth quarter of each year, which coincides with our budget and planning process for the upcoming year.

As a result of changes in macroeconomic conditions and declines in forecasted future revenue growth rates, we performed an interim review of goodwill for impairment at September 30, 2022 and at June 30, 2022. The first step of our impairment testing was to perform a qualitative assessment to determine if events and circumstances have occurred that indicate it is more likely than not that the fair value of the assets, including goodwill, are less than their carrying values. We reviewed the significant inputs used in our prior fair value estimates to determine if any changes to those inputs should be made. We estimate the fair value using a market approach and compare the estimated fair value of each entity to its carrying value, including goodwill. Under the market approach, we apply a multiple of four to each entity’s operating income to estimate the fair value. If the results of our qualitative assessment indicate that the fair value of a reporting unit may be less than its carrying value, we perform a second quantitative review of the reporting unit. Based on our assessment, we engage Bond & Pecaro, an independent third-party appraisal and valuation firm, to assist us with determining the enterprise value as part of this quantitative review.

Based on our assessment, we tested one broadcast market cluster for goodwill impairment at June 30, 2022, one digital media entity at June 30, 2022 and at September 30, 2022, and one publishing entity at June 30, 2022 and at September 30, 2022. We engaged Bond & Pecaro, an independent appraisal and valuation firm, to assist us in estimating the enterprise value of our market cluster to test goodwill for impairment. The enterprise valuation assumes that the subject assets are installed as part of an operating business rather than as a hypothetical The analysis includes both an income and cost approach to valuation. The income approach uses a discounted cash flow projection while the cost approach, or “stick” value of the underlying assets is used.

The following table presents the changes in goodwill including business acquisitions discussed in Note 3 of our Condensed Consolidated Financial Statements.

 

The key estimates and assumptions used for our enterprise valuations were as follows:

 

 

The risk-adjusted discount rate reflects the WACC developed based on data from same or similar industry participants and publicly available market data as of the measurement date.

Based on our review and analysis, we recorded an impairment charge of $0.1 million to goodwill in one of our broadcast markets at June 30, 2022. The impairment charge was driven by an increase in the WACC that was partially offset with improvements in revenue growth rates over those used in the valuation forecasts. There were no impairments during the three-month period ended September 30, 2022.

The table below presents the percentage by which the estimated fair value exceeded the carrying value, including goodwill, based on the results of our interim impairment testing: