Century Communities, Inc. Goodwill & Intangibles Disclosure
Amortizable Intangible Assets
Amortizable intangible assets consist of the estimated fair value of trade names, home construction contracts, non-compete agreements, and home plans associated with our historical acquisitions. These acquisitions were accounted for as business combinations as defined in ASC 805, Business Combinations. A high degree of judgment is made by management on variables, such as revenue growth rates, profitability, and discount rates, when calculating the value of the intangible assets. The identified intangible assets are amortized over their respective estimated useful lives. Trade names, non-compete agreements, and other intangible assets are amortized to Selling, general and administrative expenses in the Consolidated Statements of Operations. Intangible assets for cell phone tower leases, and home construction contracts are amortized to Other income and Cost of home sales revenues, respectively, as income on the related contracts are earned.
The estimated lives for each major amortizable classification of intangible assets are as follows:
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Years |
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Trade names |
2 – 10 years |
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Home construction contracts |
1 – 2 years |
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Non-compete agreements |
2 – 5 years |
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Cell phone tower leases |
5 – 20 years |
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Home plans |
7 years |
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2018 | Feb 13, 2019 | Showing above |
| 2017 | Mar 1, 2018 | |
| 2016 | Feb 15, 2017 | |
| 2015 | Feb 19, 2016 | |
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.