GOODWILL

3 Months Ended

Mar. 31, 2026

Goodwill and Intangible Assets Disclosure [Abstract]

During the first quarter of 2026, we completed certain organizational changes which resulted in a change to our presentation of reportable segments. The National Practice practice group, which consisted of a single reporting unit, is now included in the Financial Services practice group to align the internal management and reporting structure with the services provided by the practice groups. As of February 28, 2026, immediately after the organizational changes, there are a total of five reporting units, of which three are within the Financial Services practice group and two are within the Benefits and Insurances practice group.

As a result of the aforementioned changes in reporting units, we performed a qualitative assessment immediately before the change in reporting units as it relates to the two reporting units impacted by the change. We concluded that it was more likely than not that the fair values of these reporting units immediately before the change exceeded their respective carrying values and, therefore, goodwill related to those reporting units immediately before the change was determined to not be impaired.

The change in reporting units is considered a triggering event. We performed a quantitative assessment immediately after the change in reporting units by comparing the fair values of the reporting units to their respective carrying values. In measuring the estimated fair value of each reporting unit, we utilized a combination of an income approach and a market approach. Under the income approach, a discounted cash flow analysis is performed with estimates based on forecasted and projected operating cash flows, with significant assumptions related to revenue growth rates, profitability margins, and discount rates, which all vary among reporting units. The market approach utilizes the guideline public

company method and is based on revenue and earnings multiple data derived from publicly traded peer group companies. Based on the results of the quantitative assessment, we concluded that the estimated fair values of our reporting units immediately after the change were in excess of their respective carrying values, and goodwill was not impaired.

We have experienced a decline in the Company's market capitalization. This decline, along with increases in discount rates used in the impairment analysis, reduced the excess of fair value over carrying value of our Financial Accounting Services reporting unit within the Financial Services practice group, which exceeded its carrying value by approximately 7.4%, and of our Property and Casualty reporting unit within our Benefits and Insurance Services practice group, which exceeded its carrying value by approximately 14.5%. As of March 31, 2026, the carrying value of Financial Accounting Services' goodwill was $1,679.9 million and the carrying value of Property and Casualty's goodwill was $78.8 million.

It is possible, depending upon a number of factors that are not determinable at this time or within our control, that the fair value of one or more of our reporting units could decrease in the future, which could result in an impairment to goodwill. Such factors include failure to achieve the anticipated benefits of the Transaction, significant negative industry or economic trends, disruptions to our business, adverse changes resulting from new governmental regulations, negative impact on client list due to loss of customers, impact on client list due to declining revenue of existing customers, or divestitures. Additionally, further declines in our market capitalization may result in the need for impairment assessments in the future, which could result in the recognition of an impairment charge. Further, any significant adverse change in our near or long-term projections or macroeconomic conditions could result in future impairment charges, which could be material.

A summary of changes in the carrying amount of goodwill by operating segment for the three months ended March 31, 2026 is as follows (in thousands):


	Financial Services		Benefits and Insurance Services		National Practice		Total
Gross Goodwill at December 31, 2025	$	2,039,675	$	340,238	$	33,873	$	2,413,786
Accumulated impairment	(44,047)		(7,733)		(32,207)		(83,987)
Goodwill, Net at December 31, 2025	1,995,628		332,505		1,666		2,329,799
Additions	3,010		—		—		3,010
Transfer - Gross goodwill(1)	33,873		—		(33,873)		—
Transfer - Accumulated impairment(1)	(32,207)		—		32,207		—
Gross Goodwill at March 31, 2026	2,076,558		340,238		—		2,416,796
Accumulated impairment	(76,254)		(7,733)		—		(83,987)
Goodwill, Net at March 31, 2026	$	2,000,304	$	332,505	$	—	$	2,332,809

(1)Reflects change in reporting units which is the transfer of the reporting unit previously included under the National Practice segment to the Financial Services segment during the three months ended March 31, 2026.

CBIZ, Inc. 10-Q