What is the basis of presentation for the consolidated financial statements of RE/MAX, LLC?
Remax Franchise · 2025 FDDAnswer from 2025 FDD Document
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The accompanying consolidated financial statements ("financial statements") and notes thereto have been prepared in accordance with U.S. generally accepted accounting principles ("U.S. GAAP") and include the accounts of RE/MAX, LLC and its consolidated subsidiaries. All significant intercompany accounts and transactions have been eliminated. In the opinion of management, the accompanying financial statements reflect all normal and recurring adjustments necessary to present fairly the Company's financial position as of December 31, 2024 and 2023, the results of its operations and comprehensive income (loss), changes in its member's equity and its cash flows for the years ended December 31, 2024, 2023 and 2022.
Use of Estimates
The preparation of the accompanying financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.
Source: Item 1 — Business and Organization (FDD pages 334–464)
What This Means (2025 FDD)
According to the 2025 Remax Franchise Disclosure Document, the consolidated financial statements have been prepared following U.S. Generally Accepted Accounting Principles (GAAP). These statements include the accounts of RE/MAX, LLC, and its consolidated subsidiaries, with all significant intercompany accounts and transactions eliminated. Management believes that these financial statements accurately reflect the company's financial position as of December 31, 2024, and 2023. They also present the results of operations, comprehensive income (loss), changes in member's equity, and cash flows for the years ending December 31, 2024, 2023, and 2022.
In preparing these financial statements, Remax's management makes estimates and assumptions that could affect the reported amounts of assets, liabilities, and contingent liabilities, as well as reported revenues and expenses. Actual results may differ from these estimates. This is a standard practice in accounting, acknowledging that financial reporting involves some level of uncertainty and judgment.
Prospective franchisees should understand that while the financial statements are prepared in accordance with GAAP and reflect management's best estimates, these are still estimates. Actual financial performance can vary. Reviewing these statements can provide insight into Remax's financial health and performance, but it's important to consider the estimates involved and potential for variability.