Company: LGN
Filing Date: 2025-05-14
Form Type: DRS/A
Source: 0000950123-25-005247
Chunk: 252

Company: Legence Corp.
Filing Date: 2025-05-14
Form: DRS/A
Chunk 252
---
 | We evaluated the reasonableness and consistency of the methods and assumptions used by management to estimate 
 cost to complete on fixed price contracts.                                                                    |

| • |     | We evaluated management’s ability to accurately estimate cost to complete by comparing current gross profit 
 margin to historical and prospective gross profit margin for fixed price contracts.                         |

| • |     | We selected a sample of fixed price contracts and performed the following: |

| ○ |     | Evaluated management’s ability to estimate costs at completion for each selected contract by performing                                                                                                                           
 corroborating inquiries with the Company’s project managers and personnel involved with the selected contracts, including inquiries related to the timeline to completion and estimates of future costs to complete the contract. |

| ○ |     | Selected a sample of estimates of costs to complete and evaluated management’s estimates by comparing to 
 supporting documents for those estimates.                                                                |

Goodwill — Refer to Notes 2 and 5 to the financial statements Critical Audit Matter Description Goodwill is evaluated for impairment at the reporting unit level, at least, on an annual basis. Fair value of a reporting unit is estimated based on a market approach and an income approach. The income approach utilizes discounted future cash flows. Assumptions critical to the fair value estimate utilizing the discounted cash flow model include the revenue growth rate, EBITDA margin, and discount rate. We identified goodwill for three reporting units with a combined total of $247.2 million of goodwill as a critical audit matter because of the significant judgments made by management to estimate the fair value of these reporting units. This required a high degree of auditor judgment and an increased extent of effort when performing audit procedures to evaluate the reasonableness of management’s estimates and assumptions related to the revenue growth rate, EBITDA margin and the discount rate. How the Critical Audit Matter Was Addressed in the Audit Our audit procedures related to the revenue growth rate, EBITDA margin, and discount rate used by management to estimate the fair value of the reporting units included the following, among others:

| • |     | We evaluated management’s ability to accurately forecast the revenue growth rate and EBITDA margin by 
 comparing actual results to management’s historical forecasts.                                        |

F-3

Confidential Treatment Requested by Legence Corp. Pursuant to 17 C.F.R. Section 200.83

| • |     | We evaluated the reasonableness of management’s revenue growth rate and forecasted EBITDA margin by                                  
 comparing the forecasts to historical results, information included in