How does Basecamp Fitness account for revenues and expenses related to continuing engagement credits collected from franchisees in its consolidated statements of comprehensive income?
Basecamp_Fitness Franchise · 2025 FDDAnswer from 2025 FDD Document
Included in the advertising fund are fees collected from franchisees related to continuing engagement credits. These funds are used by the Company at its discretion on behalf of the Anytime Fitness brand and its franchisees. These revenues and expenses are included in other revenues and general and administrative expenses, respectively, on the consolidated statements of comprehensive income.
Source: Item 23 — RECEIPTS (FDD pages 62–248)
What This Means (2025 FDD)
According to Basecamp Fitness's 2025 Franchise Disclosure Document, the company includes fees collected from franchisees related to continuing engagement credits within the advertising fund. These funds are used at the company's discretion on behalf of the Anytime Fitness brand and its franchisees.
Specifically, the revenues from these continuing engagement credits are classified as "other revenues" on the consolidated statements of comprehensive income. The expenses associated with these credits are categorized as "general and administrative expenses" on the same statements.
This accounting treatment means that prospective Basecamp Fitness franchisees should recognize that while they contribute to these continuing engagement credits, the funds are managed and spent at the discretion of Basecamp Fitness for the benefit of the Anytime Fitness brand and its franchisees. The revenues and expenses are not directly tied to the Basecamp Fitness brand in the consolidated statements, but rather are aggregated under broader categories.