According to Beggars Pizza's 2025 Franchise Disclosure Document, the net royalty receivables, after accounting for credit losses, was $120,986 in 2023. The allowance for credit losses was $10,000 in both 2023 and 2022. Royalty receivables are stated at the net collectible amount reduced by an allowance for credit losses.

Beggars Pizza estimates this allowance based on an analysis of individual customers, adjusting for current conditions and reasonable forecasts. This includes considering the age of past due accounts and assessing the customer's ability to repay. This indicates that Beggars Pizza actively manages and accounts for potential uncollectible royalties from its franchisees.

For a prospective franchisee, this means that Beggars Pizza is diligent in accounting for potential losses from unpaid royalties. The net royalty receivables figure provides a clearer picture of the actual amount Beggars Pizza expects to collect. The allowance for credit losses reflects a realistic assessment of potential non-payments, which is a standard accounting practice to provide a more accurate financial representation.