What is Christian Brothers Automotive's maximum exposure to loss from involvement with the VIEs?

Based on the 2025 Christian Brothers Automotive Franchise Disclosure Document, the company consolidates all wholly-owned subsidiaries and variable interest entities (VIEs) for which it is the primary beneficiary. This consolidation is done in accordance with accounting principles generally accepted in the United States of America (GAAP). All significant intercompany transactions and balances are eliminated during this consolidation process.

However, the document does not explicitly state the maximum exposure to loss from involvement with VIEs. The notes to the consolidated financial statements explain the nature of Christian Brothers Automotive's operations, including its franchising activities and real estate investments. It also mentions the acquisition of WWK Warranty and Administration LLC in September 2023, which works with dealerships to provide vehicle service contracts.

While the FDD provides information on the consolidation of VIEs, it does not quantify the potential financial risks or exposure associated with these entities. A prospective franchisee should seek clarification from Christian Brothers Automotive regarding the potential financial risks associated with VIEs and how these risks could impact the overall financial performance of the franchise system.