What circumstances would trigger Engel & Volkers to review its long-lived assets for impairment?
Engel_Volkers Franchise · 2025 FDDAnswer from 2025 FDD Document
The Company reviews long-lived assets, which consists of property and equipment, right of use assets, internally developed software and intangible assets, for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. If this review reveals an indicator of impairment, as determined based on estimated undiscounted cash flows, the carrying amounts of the related long-lived assets are adjusted to fair value. Management has determined that there has been no impairment to the carrying value of its long-lived assets during the years ended December 31, 2024, 2023 and 2022.
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 88)
What This Means (2025 FDD)
According to Engel & Volkers' 2025 Franchise Disclosure Document, the company reviews its long-lived assets for impairment when certain conditions occur. These assets, which include property, equipment, right-of-use assets, internally developed software, and intangible assets, are examined when events or changes in circumstances suggest that their carrying amount may not be recoverable.
If such a review reveals an indicator of impairment, based on estimated undiscounted cash flows, Engel & Volkers will adjust the carrying amounts of the affected long-lived assets to their fair value. This process ensures that the company's financial statements accurately reflect the value of its assets.
The FDD states that management determined there was no impairment to the carrying value of its long-lived assets during the years ended December 31, 2024, 2023 and 2022.