What was the reported operating lease ROU asset for All Team in 2022?
All_Team Franchise · 2025 FDDAnswer from 2025 FDD Document
findings, and certain internal control related matters that we identified during the audit.
Tampa, Florida
May 30, 2024
ALL TEAM FRANCHISE CORPORATION BALANCE SHEETS
AS OF DECEMBER 31, 2023 AND 2022
| 2023 | 2022 | |
|---|---|---|
| CURRENT ASSETS | ||
| Cash | $ 1,015,879 | $ 894,307 |
| Accounts receivable-trade, pledged, | 1,075,420 | 2,468,379 |
| less credit losses of $57,416 and $51,915, respectively | ||
| Advances to related parties | 1,091,453 | 486,445 |
| Prepaid expenses | 20,368 | 4,098 |
| Due from IRS | 49,780 | - |
| Total Current Assets | 3,252,900 | 3,853,229 |
| PROPERTY AND EQUIPMENT, net | - | - |
| OTHER ASSETS | ||
| Operating lease right-of-use assets | 143,935 | 192,816 |
| Deposits | 34,537 | 34,537 |
| Intangible assets | 61,329 | 61,329 |
| Total Other Assets | 239,801 | 288,682 |
| TOTAL ASSETS | $ 3,492,701 | $ 4,141,911 |
| CURRENT LIABILITIES | ||
| Accounts payable - trade | $ 3,528 | $ - |
| Due to stockholder | 39,378 | 69,378 |
| Current maturity of operating lease liability | 53,626 | 48,881 |
| Credit line payable | 1,321,084 | 1,708,300 |
| Accrued expenses | 231,956 | 277,627 |
| Other funding liabilities | 919,887 | 1,246,428 |
| Total Current Liabilities | 2,569,459 | 3,350,614 |
| LONG TERM LIABILITY | ||
| Operating lease liability, net of current maturity | 90,309 | 143,935 |
| Total Long-Term Liability | 90,309 | 143,935 |
| Total Liabilities | 2,659,768 | 3,494,549 |
| STOCKHOLDER'S EQUITY | ||
| Common stock - $1 par value; |
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 33)
What This Means (2025 FDD)
According to All Team's 2025 Franchise Disclosure Document, the reported operating lease Right-of-Use (ROU) asset for the company in 2022 was $192,816. This figure reflects the value of All Team's right to use leased assets, primarily real estate, for the duration of their operating leases.
For a prospective All Team franchisee, understanding the operating lease ROU asset is crucial because it provides insight into the company's leasing obligations and how they are accounted for on the balance sheet. ROU assets and lease liabilities are recognized at the lease commencement date, based on the present value of lease payments over the lease term. This accounting treatment, implemented under ASC 842, offers a more transparent view of a company's lease-related financial commitments.
The fact that All Team has operating leases expiring in 2026 indicates ongoing lease commitments that franchisees should consider when assessing the financial stability and operational costs of the franchise. Furthermore, All Team's policy of not recording leases with terms of 12 months or less on the balance sheet, instead recognizing them as rent expense, suggests that short-term leases are a regular part of their business operations. Franchisees should inquire about the typical lease terms and conditions they might encounter.
It is important for potential franchisees to review the complete financial statements and related notes in Item 21 of the FDD, and to seek professional financial advice, to fully understand the implications of All Team's leasing arrangements and other financial obligations. This will help them make informed decisions about investing in an All Team franchise.