Principles of Consolidation

The consolidated financial statements include the accounts of the Company, its wholly-owned subsidiaries, and entities in which the Company has a variable interest of which the Company is the primary beneficiary. If the Company has a variable interest in an entity but it is not the primary beneficiary of the entity or does not exercise control over the operations and has less than 50% ownership, it will use the equity or cost method of accounting for investments.

Joint ventures

A joint venture is a contractual arrangement whereby the Company and other parties undertake an economic activity through a jointly controlled entity. Joint control exists when strategic, financial and operating policy decisions relating to the activities require the unanimous consent of the parties sharing control. Joint ventures are accounted for using the equity method and are recognized initially at cost. Joint ventures are typically included in the Other Affiliated Services unless the joint venture specifically supports one of the other reportable segments.

Investments in Equity Securities

We hold investments in certain equity securities that do not have readily determinable fair values and for which we do not exercise significant influence. These investments qualify for and are accounted for using the measurement alternative under Financial Accounting Standards Board Accounting Standards Codification (“ASC”) Topic 321, Investments (“ASC 321”).

Use of Estimates

Preparing financial statements under U.S. GAAP requires management to make estimates and assumptions that affect reported amounts and disclosures. Key areas requiring estimates include credit losses, legal contingencies, revenue recognition, stock-based compensation, and deferred tax assets.

Management bases these estimates on current facts, historical experience, and other reasonable factors. Actual results may differ materially and adversely from these estimates, which could affect future results of operations.

Reclassifications

When necessary, the Company will reclassify certain amounts in prior period financial statements to conform to the current period’s presentation. The Company maintains a consistent presentation across all periods presented.

Restricted cash

Restricted cash consists of cash held in escrow by the Company on behalf of real estate buyers. The Company recognizes a corresponding customer deposit liability until the funds are released. Once the cash transfers from escrow, the Company reduces the respective customers’ deposit liability.

The following table provides a reconciliation of cash and cash equivalents and restricted cash reported within the condensed consolidated balance sheets that sum to the total of the same amounts shown on the condensed consolidated statements of cash flows.

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