Are there any notes to the Beehive Homes financial statements?
Beehive_Homes Franchise · 2025 FDDAnswer from 2025 FDD Document
We have audited the financial statements of Bee Hive Homes, Inc. (an S corporation), which comprise the balance sheets as of December 31, 2024, 2023, and 2022, and the related statements of income, changes in shareholder's deficit, and cash flows for the years then ended, and the related notes to the financial statements.
Note A – Significant Accounting Policies
Business Activities
Bee Hive Homes, Inc., (the Company) is a closely held Utah corporation. The company was formerly known as Bee Hive Homes Intermountain, Inc., and changed the name of the corporation to Bee Hive Homes, Inc., effective January 22, 2020. The Company offers one type of Franchise: A Bee Hive Home franchise. The franchise offered is for the establishment and operation of a business offering residential care for the elderly. The Company is located in Idaho but is authorized to sell franchises in multiple states. The Company anticipates selling its franchises in every state in the United States.
Basis of Accounting
The Company uses the accrual method of accounting for financial statement purposes.
Concentration of Credit Risk
The Company maintains its cash in bank deposit accounts which, at times, may exceed federally insured limits. Accounts at financial institutions are insured by the Federal Deposit Insurance Corporation for up to $250,000. The uninsured balance totaled $354,213, $70,461, and $375,534 at December 31, 2024, 2023, and 2022, respectively.
The Company has extended credit to sub-franchisors. Two customers accounted for 28%, 38% and 28% of trade receivables at December 31, 2024, 2023, and 2022, respectively. For the year ended December 31, 2024, one customer accounted for 14% of total revenue. For the years ended December 31, 2023 and 2022, two customers accounted for 30% and 32% of total revenues, respectively.
Cash and Cash Equivalents
The Company considers its short-term, highly liquid investments purchased with a maturity of three months or less to be cash equivalents.
Advertising
Advertising costs are expensed as they are incurred. Total advertising expense for the years ended December 31, 2024, 2023 and 2022 was $104,019, $109,018 and $105,869, respectively.
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 34)
What This Means (2025 FDD)
According to the 2025 FDD, Beehive Homes' financial statements do include notes. Specifically, the Independent Auditors' Report references "the related notes to the financial statements." These notes are essential for understanding the details behind the financial figures.
One example of a note is 'Note A – Significant Accounting Policies,' which describes the company's business activities, stating that Beehive Homes, Inc. offers franchises for the establishment and operation of residential care facilities for the elderly. This note also details the basis of accounting, explaining that the company uses the accrual method. It addresses concentration of credit risk, noting that the company's cash in bank deposit accounts may exceed federally insured limits, and it provides the uninsured balances for 2024, 2023, and 2022, which were $354,213, $70,461, and $375,534, respectively.
Additionally, Note A discusses the company's policies regarding cash equivalents and advertising costs, specifying that advertising costs are expensed as incurred. The total advertising expenses for the years ended December 31, 2024, 2023, and 2022, were $104,019, $109,018, and $105,869, respectively. These notes provide additional context and explanation for various entries in Beehive Homes' financial statements.