What was the reported current portion of contract assets for 1 800 Packouts?
1_800_Packouts Franchise · 2025 FDDAnswer from 2025 FDD Document
opinion on the effectiveness of the Company'sinternal control. Accordingly, no such opinion is expressed.
- Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the financial statements.
- Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about the Company's ability to continue as a going concern for a reasonable period of time.
We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control related matters that we identified during the audit.
April 23, 2025
| (1) | 2024 | 2023 | |
|---|---|---|---|
| Assets | |||
| Current assets: | |||
| Cash | $ | 3,690,691 | $ 1,455,349 |
| Restricted cash | - | 840,143 | |
| Accounts receivable, net of an allowance for credit losses | |||
| of $74,296 and $105,953, respectively | 6,102,611 | 3,565,178 | |
| Other | 820,000 | - | |
| current | |||
| receivable | |||
| Current | 1,797,429 | 1,382,859 | |
| portion | |||
| of | |||
| contract | |||
| assets | |||
| Prepaid and other current assets | 1,803,912 | 1,537,556 | |
| Total current assets | 14,214,643 | 8,781,085 | |
| Goodwill, net | 52,556,496 | 66,184,756 | |
| Intangible assets, net | 45,678,810 | 50,358,496 | |
| Contract assets, net of current portion | 13,317,603 | 10,981,453 | |
| Operating lease right |
Source: Item 23 — RECEIPT (FDD pages 67–238)
What This Means (2025 FDD)
According to 1 800 Packouts's 2025 Franchise Disclosure Document, the current portion of contract assets was reported in two different tables with different values. One table shows the current portion of contract assets as $1,797,429 in 2024 and $1,382,859 in 2023. This is part of a larger balance sheet showing assets and liabilities for the company.
Another table provides a snapshot as of December 31, 2022, and December 31, 2021. This table indicates the current portion of contract assets was $1,350,919 in 2022 and $169,463 in 2021.
Prospective franchisees should be aware that these figures represent the short-term portion of revenues that 1 800 Packouts expects to realize from its contracts. Monitoring these values can provide insight into the company's financial health and its ability to convert contract assets into cash. It is important to understand the context and accounting practices used to classify these assets when evaluating the financial performance of 1 800 Packouts.