What was the goodwill impairment for the Corcoran Title Company in 2024?
Corcoran Franchise · 2025 FDDAnswer from 2025 FDD Document
Based upon the impairment analysis performed in the fourth quarter of 2024, there was no impairment of goodwill or other indefinite-lived intangible assets for the year ended December 31, 2024. Management evaluated the effect of lowering the estimated fair value by 10% and determined that, with the exception of the Cartus reporting unit, no impairment of goodwill would have been recognized under this evaluation for 2024. The Cartus reporting unit's fair value exceeded its carrying value by approximately 9%. While the trademarks at Brokerage Group and Title Group have a fair value in excess of 10% of their respective carrying values, trademarks at Franchise Group and Cartus have little to no excess fair value over carrying value. The fair value of trademarks is determined using the relief from royalty method which exhibits sensitivity to variations in projected revenues.
Source: Item 23 — RECEIPTS (FDD pages 75–276)
What This Means (2025 FDD)
According to Corcoran's 2025 Franchise Disclosure Document, the company performed an impairment analysis in the fourth quarter of 2024. This analysis assessed goodwill and other indefinite-lived intangible assets. The assessment compared the carrying value of each reporting unit to its fair value. If the carrying value exceeded the fair value, an impairment charge was recorded.
The FDD states that for the year ending December 31, 2024, there was no impairment of goodwill or other indefinite-lived intangible assets. This means that the carrying value of Corcoran's assets did not exceed their fair value, and therefore, no impairment charge was necessary.
The document further clarifies that management evaluated the effect of lowering the estimated fair value by 10%. This evaluation determined that, with the exception of the Cartus reporting unit, no impairment of goodwill would have been recognized under this evaluation for 2024. This suggests that the Cartus reporting unit was close to the threshold for impairment, as its fair value exceeded its carrying value by approximately 9%.