Background: David Jones is the Aussie department store best known for being a lil up market. And it's actually the oldest continuously-operating department store in the world that operates under its original name (stick that in your book of fun facts).

What happened: DJs was bought by a South African company called Woolworths Holdings (not to be confused by our Woolies) in 2014. And things have been going south for a while.

• Losses of $126 million in 2020
• Losses of $489 million in 2019
• Losses of $712 million in 2018 - largely due to impairment charges.
  

What else: Now, new accounts show that DJs recorded a net profit of $83 million in the 2021 financial year - thanks to more than $70 million in JobKeeper and the sale of a few of its commercial properties.

So what's the key learning?

💡Woolworths bought DJs for around $2.2 billion...and around $1.5 billion of that was considered 'goodwill' - aka, the amount that the David Jones brand and intellectual property is worth.

💡Each year, a company has to test whether that 'goodwill' is actually the same...or less than it was the previous year. If it ain't proving to be useful, the goodwill is considered impaired, and it gets written off.

💡In 2018, Woolworths performed a little accounting move called an impairment charge. In other words, they realised DJ's goodwill was worth $712 million less than what they bought it for. Thankfully, things look like they're coming up for DJs now.