Company: INTG
Filing Date: 2025-09-30
Form Type: 10-K
Source: 0001493152-25-016154
Chunk: 159

Company: INTERGROUP CORP
Filing Date: 2025-09-30
Form: 10-K
Item: Item 7A
Chunk 159
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 Loan amortization costs are included in interest expense
in the consolidated statements of operations.

Recently
Issued and Adopted Accounting Pronouncements

In
November 2023, the FASB issued ASU No 2023-07, “Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures”
(“ASU 2023-07”). We adopted ASU 2023-07 effective July 1, 2024 (fiscal 2025). The amendments expanded annual segment disclosure
(including significant segment expenses and CODM measures) and will expand interim segment disclosures beginning in fiscal 2026. Adoption
did not have a material impact on our consolidated financial statements, but resulted in enhanced segment disclosures.

In
December 2023, the FASB issued ASU No 2023-09, “Income Taxes (Topic 740): Improvements to Income Tax Disclosures” (“ASU
2023-09”). ASU 2023-09 is effective for fiscal years beginning after December 15, 2024 (our fiscal 2026). We expect the standard
to expand our income tax rate reconciliation and cash taxes paid disclosures; we do not expect a material impact on our consolidated
financial position or results of operations.

Going
Concern Basis and Management’s Evaluation (ASC 205-40) – Subsidiary-Only (Portsmouth)

The
accompanying consolidated financial statements are prepared in accordance with U.S. GAAP and on a going concern basis. InterGroup (the
parent) has not had a going-concern uncertainty. The disclosure below is provided solely to summarize the going-concern matter at the
Company’s majority-owned subsidiary, Portsmouth Square, Inc. (“Portsmouth”); it does not indicate or imply a going-concern
issue for InterGroup.

As
disclosed in prior filings, Portsmouth’s senior mortgage and mezzanine loans secured by the Hilton San Francisco Financial District
matured on January 1, 2024 and, after a forbearance period ended in January 2025, default notices were issued. These subsidiary-level
factors raised substantial doubt about Portsmouth’s ability to continue as a going concern at that time.

On
March 28, 2025, Portsmouth completed a comprehensive refinancing of its senior mortgage and modified its mezzanine loan, resulting in
extended maturities, favorable interest terms, and improved covenant compliance. Since closing, Portsmouth has remained current on required
de