Company: INVH
Filing Date: 2025-02-27
Form Type: 10-K
Source: 0001687229-25-000008
Chunk: 216

Company: Invitation Homes Inc.
Filing Date: 2025-02-27
Form: 10-K
Item: Item 9B
Chunk 216
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 are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matter

The critical audit matter communicated below is a matter arising from the current-period audit of the financial statements that was communicated or required to be communicated to the audit committee and that (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Investments in Single-Family Residential Properties—Refer to Notes 2 and 3 to the financial statements

Critical Audit Matter Description

The Company owned approximately 85,000 single-family residential properties with a carrying value of $17.2 billion of investments in single-family residential properties, net on the balance sheet as of December 31, 2024. The Company capitalizes costs to acquire, stabilize, and prepare single-family residential properties to be leased. They also capitalize costs that improve or extend the life of the home, a portion of the salaries and benefits of the employees who are directly responsible for such improvements, and for certain furniture and fixtures additions. The determination of which costs to capitalize requires significant management judgment. 

F-1

Given the number of homes and the volume and nature of the costs capitalized, performing audit procedures to evaluate the accounting for costs capitalized was challenging and required an increased extent of audit effort. 

How the Critical Audit Matter Was Addressed in the Audit

Our audit procedures related to whether the investments in single-family residential properties were accounted for appropriately included the following, among others:

•We tested the effectiveness of relevant controls over investments in single-family residential properties, including management’s controls over the acquisition and cost capitalization of its properties.

•We selected a sample of properties acquired and evaluated the accuracy of the amounts recorded and appropriate transfer