What does Auntie Annes consider to be included within 'cash and cash equivalents'?

According to Auntie Annes's 2024 Franchise Disclosure Document, cash and cash equivalents include highly liquid investments purchased with an original maturity of three months or less. As of December 31, 2023, and December 25, 2022, these assets consisted of funds on deposit with commercial banks and money market mutual fund accounts.

It is important to note that Auntie Annes also identifies 'restricted cash and cash equivalents,' which are funds held by a trustee for specific purposes, such as payments on the company's notes or cash collections related to securitized franchising or licensing activities. These restricted funds are not included in the general 'cash and cash equivalents' category.

For a prospective franchisee, understanding the distinction between cash and cash equivalents and restricted cash is crucial for interpreting Auntie Annes's financial statements. It provides a clearer picture of the company's liquid assets that are readily available for operational use versus those that are earmarked for specific obligations. This information can help franchisees assess the financial health and stability of Auntie Annes.