Over what period are Checkers' definite-lived intangible assets, primarily franchise agreements, amortized using the straight-line method?
Checkers Franchise · 2025 FDDAnswer from 2025 FDD Document
Definite-lived intangible assets, principally franchise agreements are amortized on a straight-line basis over their estimated useful lives of 15 years (see Note 11. Goodwill and Intangible Assets, Net). The Company assesses definite-live intangibles for impairment on an annual basis, or upon the existence of events or conditions which indicate that the asset may not be recoverable.
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 91)
What This Means (2025 FDD)
According to Checkers' 2025 Franchise Disclosure Document, definite-lived intangible assets, which primarily consist of franchise agreements, are amortized using the straight-line method over their estimated useful lives. These useful lives are set at 15 years.
This means that Checkers spreads the cost of these intangible assets evenly over a 15-year period. This accounting practice reflects the period over which Checkers expects to benefit from these assets.
Checkers also assesses these definite-lived intangibles for impairment on an annual basis. Additionally, Checkers will evaluate for impairment if events or conditions suggest that the asset may not be recoverable. This assessment can lead to adjustments in the asset's value if its expected future benefits decrease.