Under ASC 606, when does All Team recognize revenue?
All_Team Franchise · 2025 FDDAnswer from 2025 FDD Document
In 2019, the Company adopted ASC 606, Revenue from Contracts with Customers, which amended the existing accounting standards for revenue recognition. Consequently, the Company recognizes revenue when the services are provided, persuasive evidence of an arrangement exists, the price is fixed and collection is reasonably assured in accordance with ASC 606.
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 33)
What This Means (2025 FDD)
According to All Team's 2025 Franchise Disclosure Document, the company adopted ASC 606, Revenue from Contracts with Customers, in 2019. This amended the existing accounting standards for revenue recognition.
Consequently, All Team recognizes revenue when specific conditions are met. These conditions are when the services are provided, there is persuasive evidence of an arrangement, the price is fixed, and collection is reasonably assured. This approach aligns with ASC 606 standards.
For a prospective franchisee, this means that All Team's revenue recognition is tied directly to the provision of services and the certainty of payment. This is a standard accounting practice ensuring that revenue is only recorded when it is earned and reasonably collectible.