Financial reporting discrepancy – Shoe Carnival


I am writing an XBRL (format used for SEC reporting) parser and I stumbled upon a discrepancy that I can't get my head around. Have a look at https://www.sec.gov/ix?doc=/Archives/edgar/data/0000895447/000095017024070218/scvl-20240504.htm “note 2” states-

On February 13, 2024, we acquired all of the stock of Rogan Shoes, Incorporated, a privately-held 53-year-old work and family footwear company incorporated in Wisconsin (“Rogan’s”) for a preliminary purchase price of $44.6 million, net of $2.2 million of cash acquired. The preliminary purchase price was funded entirely with cash on hand and is subject to customary adjustments, and additional consideration of up to $5.0 million may be paid by the Company subject to the achievement of three-year performance targets. At the time of the acquisition, Rogan’s operated 28 store locations in Wisconsin, Minnesota and Illinois. The Rogan’s acquisition advanced our strategy to be the nation’s leading family footwear retailer. It immediately positioned us as the market leader in Wisconsin, and it established a store base in Minnesota, creating additional expansion opportunities.

I am highlighting the interesting part in bold- The preliminary purchase price was funded entirely with cash on hand and is subject to customary adjustments,

This makes me believe that no debt was used for this acquisition. However, when you open the XML file (you can click on Menu->Save XBRL instance) https://www.sec.gov/Archives/edgar/data/895447/000095017024070218/scvl-20240504_htm.xml you will find this XML node (line 2641)

3600000

The contextRef points to

    
        
            0000895447
            
                scvl:RoganShoesIncorporatedMember
                us-gaap:FairValueInputsLevel3Member
            
        
        
            2024-02-13
            2024-02-13
        
    

Now, the documentation of BusinessCombinationConsiderationTransferredLiabilitiesIncurred states

Amount of liabilities incurred by the acquirer as part of consideration transferred in a business combination

This is what I find confusion. Per the XML documentation, it implies they incurred net-new 3600000 (3.6 million) of liabilities but this is not mentioned anywhere in the report.

What am I missing?


EDIT: I found the relevant information on the cash flow statement- “Contingent consideration related to business acquisition” . Still wanted to see a note clarifying they will need to pay this amount in future if certain conditions are met.


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