What was the balance of goodwill for Black Bear Diner as of December 28, 2022?
Black_Bear_Diner Franchise · 2025 FDDAnswer from 2025 FDD Document
Use of Estimates: The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Areas that include significant estimates made by management include, but are not limited to, estimated useful lives and carrying value of long-lived assets and the valuation of intangible assets and goodwill. Actual results could differ significantly from those estimates.
Source: Item 23 — RECEIPT (FDD pages 56–243)
What This Means (2025 FDD)
Based on the 2025 Franchise Disclosure Document, the financial statements' preparation requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities. These estimates also cover the disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported amounts of revenue and expenses during the reporting period. According to the FDD, these estimates include the valuation of intangible assets and goodwill. However, the exact balance of goodwill for Black Bear Diner as of December 28, 2022, is not specified in the provided excerpts.
While the document acknowledges that the valuation of goodwill is part of the financial statements, it does not provide the actual value. Instead, it only mentions that actual results could differ significantly from those estimates. This is a standard accounting disclosure, indicating that the reported financial figures are subject to change based on various factors and management's judgment.
A prospective Black Bear Diner franchisee should request specific details regarding the goodwill balance from the franchisor. Understanding the valuation of goodwill can provide insights into the financial health and stability of the franchise system. It would be prudent to ask for the audited financial statements to review the specific goodwill balance and how it has been assessed over recent years.