Toadstool coral

Depends. Is it just a surface layer of tissue? If so then no worries; leather corals shed regularly, sloughing off a layer of brownish transparent 'skin' when they do.

If it's a localized sloughing off of tissue that leaves an actual indentation in the flesh of the coral, it's most likely a bacterial infection. In leathers these are frequently caused by insufficient flow over the surface of the coral, allowing detritus to collect in low spots on it's surface. The 'clogged' areas become bacterial breeding grounds and the coral starts losing tissue in the affected area, which have the possibility of continuing to spread causing widespread harm and even death.