How often does Hardees test goodwill for impairment?
Hardees Franchise · 2025 FDDAnswer from 2025 FDD Document
We test goodwill for impairment on an annual basis, or more frequently if events and/or circumstances indicate that goodwill might be impaired. The impairment test is performed at the reporting unit level, and an impairment loss is recognized to the extent that the carrying amount of the reporting unit exceeds its fair value. We consider our reporting units to be company-operated restaurants, domestic franchised restaurants and international franchised restaurants as the components (e.g., restaurants) within each reporting unit have similar economic characteristics, including products and services, production processes, types or classes of customers and distribution methods.
Source: Item 21 — Financial Statements (FDD pages 84–85)
What This Means (2025 FDD)
According to Hardees's 2025 Franchise Disclosure Document, Hardees tests goodwill for impairment on an annual basis. However, Hardees may test more frequently if events or circumstances suggest that the goodwill might be impaired. The impairment test is conducted at the reporting unit level.
Hardees considers its reporting units to be company-operated restaurants, domestic franchised restaurants, and international franchised restaurants. This is because the components within each reporting unit, such as the restaurants, share similar economic characteristics. These characteristics include products and services, production processes, types or classes of customers, and distribution methods.
An impairment loss is recognized if the carrying amount of the reporting unit exceeds its fair value. The loss is recognized to the extent that the carrying amount exceeds the fair value.