According to All Team's 2025 Franchise Disclosure Document, the allowance for credit losses in 2022 was $6,000, as shown in the cash flows from operating activities section of the financial statements. This figure represents an estimate of the amount of accounts receivable that All Team does not expect to collect. This allowance is a contra-asset account that reduces the gross amount of accounts receivable to its net realizable value, which is the amount the company realistically expects to receive.

For a prospective franchisee, understanding the allowance for credit losses can provide insight into the financial health and risk management practices of All Team. A higher allowance might suggest that All Team is experiencing difficulties in collecting payments from its franchisees or customers, which could impact its cash flow. Conversely, a lower allowance may indicate more effective credit and collection policies.

It's also important to note that the balance sheet provides additional context. In 2022, All Team had accounts receivable of $2,468,379, which was reduced by credit losses of $51,915. The provision for credit losses, found in the income statement, was $6,000 for 2022. These figures offer a more complete picture of how All Team manages and accounts for potential uncollectible receivables. A potential franchisee should analyze these trends over multiple years to assess the stability and predictability of All Team's financial performance.