What was the reported goodwill, net amount 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, |
Source: Item 23 — RECEIPT (FDD pages 67–238)
What This Means (2025 FDD)
According to 1 800 Packouts's 2025 Franchise Disclosure Document, the goodwill, net amount was reported as $52,556,496 as of December 31, 2024, and $66,184,756 as of December 31, 2023. Goodwill represents the intangible assets acquired in a business acquisition, such as brand reputation and customer relationships. It is the difference between the purchase price and the net identifiable assets of the acquired company.
For a prospective 1 800 Packouts franchisee, understanding goodwill is crucial because it reflects the value the company places on its existing brand and operations. A higher goodwill value typically indicates a stronger brand presence and potentially a more successful business model. However, goodwill is also subject to impairment, meaning its value can decrease if the acquired business performs poorly.
The fluctuation in goodwill from $66,184,756 in 2023 to $52,556,496 in 2024 could be due to several factors, including impairment, adjustments from legal settlements, or changes in the valuation of acquired assets. A prospective franchisee should inquire about the reasons for this change to fully understand the financial health and stability of 1 800 Packouts. Monitoring goodwill over time provides insights into the long-term value and sustainability of the franchise system.