How does Nothing Bundt Cakes now test goodwill for impairment, after changing its method of accounting?

According to Nothing Bundt Cakes' 2025 Franchise Disclosure Document, the company changed certain accounting principles in 2024 to retroactively discontinue the private company accounting election for goodwill. The excerpt does not elaborate on the specific details of how Nothing Bundt Cakes tests goodwill for impairment after this change.

As the FDD does not specify the exact method Nothing Bundt Cakes uses to test goodwill for impairment, it is important for a prospective franchisee to seek clarification from the franchisor. Understanding the specific procedures and criteria used for impairment testing can help franchisees better assess the financial health and stability of the franchisor.

To gain a comprehensive understanding, a prospective Nothing Bundt Cakes franchisee should ask the franchisor for detailed information on their current goodwill impairment testing methodology. This inquiry should include the specific accounting standards followed, the frequency of testing, and the criteria used to determine if an impairment exists. This information will allow the franchisee to make a more informed decision about investing in the franchise.