How does Anago classify its investments on its financial statements?
Anago Franchise · 2025 FDDAnswer from 2025 FDD Document
ble with a master franchise with | a balance as of December 31, 2022 of $2,500. | | Thenote | receivable is not securedand isdueon demand. Thenotereceivable | waspaid-offduring2023. | | Notesreceivablealsoas | ofDecember 31, 2024,2023, and2022consistoffranchisenotesreceivable | forthe initial | | | totaling$46,724,$54,794,and | $60,925, respectively. |
ANAGO CLEANING SYSTEMS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE YEARS ENDED DECEMBER 31, 2024, 2023, and 2022
| Stocksareinvestments | that arevalued | based onquoted prices on thelast | tradingdateof the principal market on or | |---|---|---|---| | before December | 31, 2024, 2023, and | 2022. They include investments | that are directly held in publicly traded | | | 2023, 2022 | the fair market value of the stock investments | totaled | | equities. As | of December 31, 2024, | and | | | $1,601,902,$1,371,933,and$708,515,respectively. | | Thesefunds have been | invested in domesticstocks. | NOTE A – PRINCIPLES OF CONSOLIDATION, NATURE OF ACTIVITIES AND SIGNIFICANT ACCOUNTING POLICIES
Principles of Consolidation
The accompanying consolidated financial statements include the accounts of Anago Cleaning Systems, Inc., Anago Franchising, Inc., Anago Direct Marketing, Inc., APLR, Inc., CCTD, Inc. and PBTR, Inc., (the consolidated group referred to as the "Company").
In January 2023 the Company acquired EHLB, Inc. dba Anago of Las Vegas which is included in the consolidated financial statements during the year ended December 31, 2023. In November 2024, the Company sold the territory held by EHLB, Inc. dba Anago of Las Vegas.
The intercompany accounts of the Company have been eliminated.
Nature of Activities
Anago Cleaning Systems, Inc. and Subsidiaries is headquartered in Pompano Beach, Florida. The Company offers master franchises within specific territories to individuals interested in small business ownership within the given territory. The master franchises in turn have the rights to sell and service "unit franchisees" in the territorial market as determined by the master franchise agreements. These "unit franchisees" provide janitorial services through commercial contracts within the master franchise territory.
The Company holds certain master franchisees through temporary ownership due to the abandonment or returned master territories. The operations of these master franchisees are maintained with the full intent of finding an unrelated party for resale. During the year ended December 31, 2024, 2023, and 2022 the Company held ownership in EHLB, Inc., PBTR, Inc. and CCTD, Inc. In November 2024, the Company sold the territory held by EHLB, Inc.
APLR, Inc. has been established to hold certain contracts which are not in a current master territory. This entity operates as a master franchise.
The latest franchise disclosure document for Company had an issuance date of May 1, 2024. The Company anticipates issuance of the franchise disclosure document on April 1, 2025.
Estimates
Management used estimates and assumptions in preparing these consolidated financial statements in accordance with accounting principles generally accepted in the United States of America.
Source: Item 23 — RECEIPTS (FDD pages 62–298)
What This Means (2025 FDD)
According to Anago's 2025 Franchise Disclosure Document, the company's financial statements consolidate the accounts of Anago Cleaning Systems, Inc., along with its subsidiaries: Anago Franchising, Inc., Anago Direct Marketing, Inc., APLR, Inc., CCTD, Inc. and PBTR, Inc. In January 2023, Anago acquired EHLB, Inc. dba Anago of Las Vegas, which was included in the consolidated financial statements for that year. However, in November 2024, Anago sold the territory held by EHLB, Inc. dba Anago of Las Vegas. Intercompany accounts among these entities are eliminated during consolidation.
Anago also holds certain master franchises temporarily due to abandonment or return, with the intent to resell them to unrelated parties. During 2024, 2023, and 2022, the company held ownership in EHLB, Inc., PBTR, Inc. and CCTD, Inc. APLR, Inc. is used to hold contracts not within a current master territory and operates as a master franchise itself. The sale of the territory assets of EHLB, Inc. dba Anago of Las Vegas in November 2024 resulted in proceeds of $400,000, compared to an estimated cost of $98,000, resulting in a gain of $302,000. This gain is recorded as other income on the consolidated statement of operations.
For EHLB, Inc. dba Anago of Las Vegas, since its operations will not continue in future periods, its revenue and expenses have been reclassified and reported under "other income and expenses." The net income (loss) for EHLB, Inc. dba Anago of Las Vegas for the years ending December 31, 2024 and 2023, totaling a loss of ($34,405) and income of $317,735 respectively, have been reclassified to other income (expenses) for comparison purposes and to reflect the discontinued future operations of the company. Anago grants credit to its clients without requiring collateral, relying on its client and franchisee acceptance, billing, and collection policies to manage potential credit risk. Anago's cash and equivalents accounts may be subject to credit risk, particularly concerning funds held in financial institutions exceeding the Federal Deposit Insurance Corporation (FDIC) coverage limit of $250,000. As of December 31, 2024, 2023, and 2022, Anago had funds exceeding the FDIC limit by $1,370,883, $1,381,558, and $660,503, respectively.