Update to Significant Accounting Policies (Tables)

3 Months Ended

Mar. 29, 2020

Update to Significant Accounting Policies

Schedule of Income Before Income Taxes Attributable to Joint Ventures

The income before income taxes attributable to these joint ventures for the three months ended March 29, 2020 and March 31, 2019 was as follows (in thousands):

	Three Months Ended
	March 29,		March 31,
	2020		2019
Papa John’s International, Inc.	$	1,131	$	464
Noncontrolling interests		550		133
Total income before income taxes	$	1,681	$	597

Schedule of Joint Ventures in Which There are Noncontrolling Interests

The following summarizes the redemption feature, location and related accounting within the Condensed Consolidated Balance Sheets for these joint venture arrangements:

Type of Joint Venture Arrangement	Location within the Balance Sheets	Recorded Value
Joint ventures with no redemption feature	Permanent equity	Carrying value
Joint ventures with option to require the Company to purchase the noncontrolling interest - not currently redeemable or redemption not probable	Temporary equity	Carrying value

Schedule of Financial Assets and Liabilities Measured at Fair Value on a Recurring Basis

Our financial assets and liabilities that were measured at fair value on a recurring basis as of March 29, 2020 and December 29, 2019 are as follows (in thousands):

	Carrying		Fair Value Measurements
	Value		Level 1		Level 2		Level 3
March 29, 2020
Financial assets:
Cash surrender value of life insurance policies (a)	$	27,787	$	27,787	$	—	$	—
Financial liabilities:
Interest rate swaps (b)		17,020		—		17,020		—
December 29, 2019
Financial assets:
Cash surrender value of life insurance policies (a)	$	33,220	$	33,220	$	—	$	—
Financial liabilities:
Interest rate swaps (b)		6,168		—		6,168		—

(a) Represents life insurance policies held in our non-qualified deferred compensation plan.

(b) The fair value of our interest rate swaps is based on the sum of all future net present value cash flows. The future cash flows are derived based on the terms of our interest rate swaps, as well as considering published discount factors, and projected London Interbank Offered Rates (“LIBOR”).

Schedule rollforward of the allowance for credit losses for accounts receivable, notes receivable and other assets

(in thousands)	Accounts Receivable		Notes Receivable		Interest Receivable
Balance at December 29, 2019	$	7,341	$	3,572	$	910
Cumulative effect of adoption of ASU 2016-13		911		463		-
Balance at December 30, 2019		8,253		4,035		910
Current period provision for expected credit losses		625		-		144
Write-offs charged against the allowance		(380)		-		-
Recoveries collected		-		(22)		-
Balance at March 29, 2020	$	8,498	$	4,013	$	1,054