Goodwill and Other Intangible Assets
Goodwill
Goodwill consists of the excess of the purchase price over the fair value of the net assets acquired in connection with business acquisitions.
A reconciliation of the change in the carrying value of goodwill is as follows.
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| Restaurants | | Insurance | | Total |
| Balance as of December 31, 2022 | | | | | |
| Goodwill | $ | 28,100 | | | $ | 25,713 | | | $ | 53,813 | |
| Accumulated impairment losses | (300) | | | — | | | (300) | |
| $ | 27,800 | | | $ | 25,713 | | | $ | 53,513 | |
| Change in foreign exchange rates during 2023 | 17 | | | — | | | 17 | |
| Balance as of December 31, 2023 | $ | 27,817 | | | $ | 25,713 | | | $ | 53,530 | |
| Impairment losses during 2024 | (1,000) | | | — | | | (1,000) | |
| Change in foreign exchange rates during 2024 | (34) | | | — | | | (34) | |
| Balance as of December 31, 2024 | $ | 26,783 | | | $ | 25,713 | | | $ | 52,496 | |
We evaluate goodwill and any indefinite-lived intangible assets for impairment annually, or more frequently if circumstances indicate impairment may have occurred. Goodwill and indefinite-lived intangible asset impairment evaluations include determining the estimated fair values of our reporting units and indefinite-lived intangible assets. The key assumptions and inputs used in such determinations may include forecasting revenue and expenses, cash flows, and capital expenditures, as well as an appropriate discount rate and other inputs. Significant judgment by management is required in estimating the fair value of a reporting unit and in performing impairment reviews. Due to the inherent subjectivity and uncertainty in forecasting future cash flows and earnings over long periods of time, actual results may differ materially from the forecasts. If the carrying value of the indefinite-lived intangible asset exceeds fair value, the excess is charged to earnings as an impairment loss. If the carrying value of a reporting unit exceeds the estimated fair value of the reporting unit, then the excess, limited to the carrying amount of goodwill, will be charged to earnings as an impairment loss. GAAP allows entities testing for impairment the option of performing a qualitative assessment before calculating the fair value of a reporting unit for the goodwill impairment test. For our 2024 annual goodwill impairment testing, we elected to perform qualitative assessments for our reporting units. No indicators of impairment were noted in our insurance reporting units. During the second quarter of 2024, we performed our annual assessment of our recoverability of goodwill related to the Western Sizzlin reporting unit and an impairment of $1,000 was recorded. There was no impairment recorded by Steak n Shake. No impairment was recorded for our reporting units in 2023.
Other Intangible Assets
Intangible assets with indefinite lives are composed of the following.
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| Trade Names | | Lease Rights | | Total |
| Balance as of December 31, 2022 | | | | | |
| Intangibles | $ | 15,876 | | | $ | 10,889 | | | $ | 26,765 | |
| Accumulated impairment losses | — | | | (3,748) | | | (3,748) | |
| $ | 15,876 | | | $ | 7,141 | | | $ | 23,017 | |
| Change in foreign exchange rates during 2023 | — | | | 213 | | | 213 | |
| Balance as of December 31, 2023 | $ | 15,876 | | | $ | 7,354 | | | $ | 23,230 | |
| Change in foreign exchange rates during 2024 | — | | | (410) | | | (410) | |
| Balance as of December 31, 2024 | $ | 15,876 | | | $ | 6,944 | | | $ | 22,820 | |
Intangible assets with indefinite lives consist of trade names and lease rights. No impairment was recorded in 2024. During 2023, $20 of impairment was recorded.
About Goodwill & Intangibles Disclosures
Goodwill and intangible asset disclosures reveal the premium paid in acquisitions and how management assesses whether that premium retains its value. Since goodwill is no longer amortized under US GAAP, the annual impairment test is the only mechanism that adjusts carrying values downward — making the assumptions behind that test critically important for investors.
Key signals: a history of goodwill impairments suggests management consistently overpays for acquisitions. Watch the gap between reporting unit fair value and carrying amount — when fair value exceeds carrying amount by less than 10-20%, a small decline in business performance could trigger a write-down. For finite-lived intangibles, examine useful life assumptions across customer relationships, technology, and trade names; aggressive estimates inflate near-term earnings. Compare total intangibles-to-total-assets ratios against peers to assess acquisition dependency. Rising goodwill as a percentage of equity can signal balance sheet fragility.