Media General Inc., owner of the Richmond Times-Dispatch and other media properties, has taken a $512 million goodwill impairment charge of $512 million for its publishing division and more than $265 million related to its broadcast operations, reports Editor & Publisher. After taxes, the total impairment charges amounted to $532 million.

The charges, filed yesterday with the Securities Exchange Commission, are in line with the $500 million to $550 million after tax that the Richmond-based company had estimated in July that it would take. Goodwill is an accounting concept that reflects a premium over book value that a company pays to acquire another company. If the recorded value of the goodwill is greater than the fair value of the assets, it is considered impaired, and the difference is written off.

Media General has made numerous newspaper and broadcast acquisitions over the years, typically paying more than book value in exchange for revenue and profit streams that have since diminished.

"We determined that, in view of the continued economic slowdown and the market's perception of media industry equity valuations, this was the appropriate time to undertake the impairment testing," said CEO Marshall N. Morton in July. "This charge is non-cash and will not impact our ability to operate, reduce debt or more forward with our ongoing transition to the digital world."

The charge should have a major impact on Media General's balance sheet, which recorded shareholder equity of $879 million in June – down from $937 million two years previously.