What is the nature of the notes receivable held by Beef O Bradys, and what do they primarily consist of?
Beef_O_Bradys Franchise · 2025 FDDAnswer from 2025 FDD Document
d advertising fees | 21,000 | | 27,000 | | Salaries and overhead charges | 25,000 | | 25,000 |
As of December 31, 2024, and 2023, the Company had $695,264 and $458,178, respectively, due from the Beef 'O' Brady's Fund and $983,582 and $809,282, respectively, due from the Brass Tap Fund.
Note 12. Significant Concentrations
Concentrations of Credit Risk
Financial instruments which potentially subject the Company to concentrations of credit risk consist principally of cash, franchisee and notes receivable, and amounts due from related parties.
Source: Item 23 — RECEIPTS. (FDD pages 66–330)
What This Means (2025 FDD)
According to Beef O Bradys's 2025 Franchise Disclosure Document, the company's financial instruments are subject to credit risk, consisting primarily of cash, franchisee and notes receivable, and amounts due from related parties. Beef O Bradys maintains cash with various financial institutions and performs periodic evaluations of their credit standing, believing the risk to be minimal.
As of December 31, 2024, Beef O Bradys had $695,264 due from the Beef 'O' Brady's Fund and $983,582 due from the Brass Tap Fund. In the prior year, December 31, 2023, the amounts due from these funds were $458,178 and $809,282, respectively. These figures indicate the amounts that the Funds owe to the Company for various services and reimbursements.
For a prospective franchisee, this indicates that Beef O Bradys has credit risk associated with franchisee receivables and amounts due from related parties. It also shows the financial interactions between Beef O Bradys and its marketing and development funds for both the Beef 'O' Brady's and Brass Tap brands. Understanding these relationships and the credit risk involved can be important for assessing the financial stability of the company.