XML 33 R23.htm IDEA: XBRL DOCUMENT v3.22.2.2
Summary of Significant Accounting Policies (Tables)
9 Months Ended
Sep. 30, 2022
Summary of Significant Accounting Policies  
Schedule of deferred revenue for franchise sales and annual dues

Deferred revenue is primarily driven by Franchise sales and Annual dues, as discussed above, and is included in “Deferred revenue” and “Deferred revenue, net of current portion” on the Condensed Consolidated Balance Sheets. Other deferred revenue is primarily related to events-related revenue. The activity consists of the following (in thousands):

Balance at

Revenue

Balance at

January 1, 2022

New billings

recognized (a)

September 30, 2022

Franchise sales

$

26,043

$

5,839

$

(6,387)

$

25,495

Annual dues

15,020

26,673

(26,847)

14,846

Other

5,044

18,040

(19,421)

3,663

$

46,107

$

50,552

$

(52,655)

$

44,004

(a)

Revenue recognized related to the beginning balance for Franchise sales and Annual dues were $5.9 million and $13.8 million, respectively, for the nine months ended September 30, 2022.

Schedule of commissions related to franchise sales The activity in the Company’s capitalized contract costs for commissions (which are included in “other current assets” and “other assets, net of current portion” on the Condensed Consolidated Balance Sheets) consist of the following (in thousands):

Additions to

Balance at

contract cost

Expense

Balance at

January 1, 2022

for new activity

recognized

September 30, 2022

Capitalized contract costs for commissions

$

4,010

$

1,316

$

(1,491)

$

3,835

Schedule of transaction price allocated to the remaining performance obligations

The following table includes estimated revenue by year, excluding certain other immaterial items, expected to be recognized in the future related to performance obligations that are unsatisfied (or partially unsatisfied) at the end of the reporting period (in thousands):

Remainder of 2022

2023

2024

2025

2026

2027

Thereafter

Total

Annual dues

$

6,986

$

7,860

$

$

$

$

$

$

14,846

Franchise sales

1,875

6,718

5,550

4,313

2,920

1,507

2,612

25,495

Total

$

8,861

$

14,578

$

5,550

$

4,313

$

2,920

$

1,507

$

2,612

$

40,341

Schedule of disaggregated revenue

In the following table, segment revenue is disaggregated by Company-Owned or Independent Regions, where applicable, by segment and by geographical area (in thousands):

Three Months Ended

Nine Months Ended

September 30, 

September 30, 

2022

2021

2022

2021

U.S. Company-Owned Regions (a)

$

39,975

$

42,922

$

121,862

$

113,081

U.S. Independent Regions (a)

1,819

2,592

5,397

9,610

Canada Company-Owned Regions (a)

10,764

8,889

32,673

17,243

Canada Independent Regions (a)

723

1,258

2,141

5,827

Global

2,908

2,967

9,193

8,462

Fee revenue (b)

56,189

58,628

171,266

154,223

Franchise sales and other revenue (c)

6,466

5,995

21,902

17,845

Total Real Estate

62,655

64,623

193,168

172,068

U.S. (a)

17,186

18,471

52,386

51,012

Canada (a)

5,201

4,541

15,202

7,702

Global

349

257

908

742

Total Marketing Funds

22,736

23,269

68,496

59,456

Mortgage (d)

3,194

2,620

9,337

7,353

Other (d)

358

485

1,118

1,661

Total

$

88,943

$

90,997

$

272,119

$

240,538

(a)In July 2021, the Company acquired the operating companies of the North America regions of INTEGRA. Fee revenue from these regions were previously recognized in the U.S. and Canada Independent Regions. See Note 5, Acquisitions and Dispositions, for information related to this transaction.
(b)Fee revenue includes Continuing franchise fees, Annual dues and Broker fees.
(c)Franchise sales and other revenue is derived primarily within the U.S.
(d)Revenue from Mortgage and Other are derived exclusively within the U.S.
Schedule of reconciliation of cash, both unrestricted and restricted The following table reconciles the amounts presented for cash, both unrestricted and restricted, in the Condensed Consolidated Balance Sheets to the amounts presented in the Condensed Consolidated Statements of Cash Flows (in thousands):

September 30, 

December 31,

2022

2021

Cash and cash equivalents

$

117,899

$

126,270

Restricted cash

31,399

32,129

Total cash, cash equivalents and restricted cash

$

149,298

$

158,399

Schedule of cost charges to intersegment

Costs charged from Real Estate to the Marketing Funds are as follows (in thousands):

Three Months Ended

Nine Months Ended

September 30, 

September 30, 

2022

2021

2022

2021

Technology − operating

$

3,526

$

3,213

$

11,269

$

10,046

Technology − capital (a)

(277)

243

884

647

Marketing staff and administrative services

1,493

1,725

4,174

4,032

Total

$

4,742

$

5,181

$

16,327

$

14,725

During the third quarter of 2022, due to the Company’s restructuring, the cost of work in process assets that would no longer be placed in service totaling $0.5 million was refunded to the Marketing Funds.