Companies will have to carry out further write-downs of poorly performing assets this year as the global economy struggles to recover, according to investors, analysts and lenders surveyed by Ernst & Young.
The survey of 170 global firms showed that nearly half of those questioned believe the level of impairment charges reported since the financial crisis began is lower than they expected.
E&Y said its respondents are “sceptical” about the size of impairments being published so far and are bracing themselves for further write-downs in 2010. The real estate, banking and capital markets, and automotive sectors are thought likely to experience further impairment charges this year.
The firm says valuing businesses and their underlying assets is “more challenging today than at any other time in recent history”.