How does Bw Premier Collection measure fair value for assets and liabilities?
Bw_Premier_Collection Franchise · 2025 FDDAnswer from 2025 FDD Document
ts have created the following fair value hierarchy:
- Level 1 quoted prices for identical instruments in active markets;
- Level 2 quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-derived valuations in which significant inputs and significant value drivers are observable in active markets; and
- Level 3 fair value measurements derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.
The Company measures fair value using a set of standardized procedures for all assets and liabilities which are required to be measured at their estimated fair value on either a recurring or non-recurring basis. When available, the Company utilizes quoted market prices from an independent third-party source to determine fair value and classifies such items in Level 1.
November 30, 2024
In accordance with the fair value accounting requirements, companies may choose to measure eligible financial instruments and certain other items at fair value. The Company has not elected the fair value option for any eligible financial instruments.
The investments in the Trust are restricted and are designated as trading securities and carried at fair value. The fair market value of these restricted investments are measured using Level 1 inputs (quoted prices for identical assets in active markets).
The following tables present information about the carrying value of the Company's financial assets compared to fair value as of November 30, 2024 and 2023, and indicate the fair value hierarchy of the valuation techniques utilized to determine such fair value. The investments in certificates of deposits, mutual funds, common shares, U.S. treasury and government agency bonds, corporate bonds, mortgage and asset-backed securities, and municipal and provincial notes and bonds are included in both short-term and long-term investments in the Consolidated Statements of Financial Position, and the investments held in a Restricted Rabbi Trust are included in Restricted Rabbi Trust investments in the Consolidated Statements of Financial Position.
Carrying Value vs.
Source: Item 23 — Receipts (FDD pages 54–203)
What This Means (2025 FDD)
According to Bw Premier Collection's 2025 Franchise Disclosure Document, the company uses a standardized procedure to measure the fair value of its assets and liabilities that are required to be measured at their estimated fair value, whether recurring or non-recurring. When available, Bw Premier Collection uses quoted market prices from an independent third-party source to determine fair value and classifies these items as Level 1.
The FDD outlines a hierarchy of levels used to determine fair value. Level 1 measurements are based on quoted prices for identical instruments in active markets. Level 2 measurements use quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-derived valuations where significant inputs and value drivers are observable in active markets. Level 3 measurements are derived from valuation techniques where one or more significant inputs or significant value drivers are unobservable.
Bw Premier Collection also evaluates the potential impairment of goodwill and other intangible assets annually, and may elect to first assess qualitative factors to determine whether it is more likely than not that the fair value of the reporting unit or the intangible assets is less than its carrying amount. The company determines the fair value of its reporting units and intangible assets using income and market methods. For long-lived assets, recoverability is assessed by comparing the carrying amount of an asset to future undiscounted net cash flows expected to be generated by the asset. If impaired, the impairment recognized is the excess of the carrying amount over the estimated fair value.