As of what date are the Notes to the Financial Statements for Body Brain Center provided?
Body_Brain_Center Franchise · 2025 FDDAnswer from 2025 FDD Document
Notes to the Financial Statements December 31, 2024 and 2023
NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
This summary of significant accounting policies of Body and Brain Center, LLC (the "Company") is presented to assist in understanding the Company's financial statements. The financial statements and notes are the representations of the Company's management who is responsible for their integrity and objectivity. These accounting policies conform to accounting principles generally accepted in the United States of America and have been consistently applied in the preparation of the financial statements.
Nature of Operation
Body and Brain Center, LLC is an Arizona limited liability Company that was organized on December 12, 2007. The Company is a wholly-owned subsidiary of Body & Brain Yoga and Health Centers, Inc. The Company is engaged in the business of franchising a chain of studios providing yoga classes, including dieting programs, exercise programs, relaxation programs, healing programs, life coaching and other mind-body practice programs, known as "Body & Brain" franchisees. Each franchisee independently operates a center using the Marks, the Unique System, the Body and Brain name, as well as the support, guidance and other methods and materials provided or developed by the Company.
Estimates
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make judgments, estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results may differ from those estimates. Estimates are based on management's previous experience including expectations of future events under normal conditions. The aforementioned judgments, estimates and assumptions are periodically re-assessed in order to be in line with current available data and reflect current risks.
Goodwill
Goodwill represents the excess of the amount paid by the Company over the book value of the assets purchased for a direct center. Goodwill is not amortized but tested at least annually for impairment. To determine whether goodwill is impaired, annually or more frequently if needed, the Company performs a multi-step impairment test. The Company may first assess qualitative factors to determine if it is more likely than not that the carrying value of a reporting unit exceeds its estimated fair value.
Source: Item 23 — RECEIPT (FDD pages 43–178)
What This Means (2025 FDD)
According to Body Brain Center's 2025 Franchise Disclosure Document, the notes to the financial statements are provided as of December 31, 2024 and 2023. These notes offer context and details about the financial statements of Body Brain Center, LLC, helping to explain the figures and amounts presented.
The notes include a summary of significant accounting policies, which outlines the principles and methods Body Brain Center uses to prepare its financial statements. This is crucial for understanding how the financial data is reported and ensuring consistency in financial reporting. It also covers the nature of operations, explaining Body Brain Center's business as a franchisor of yoga and mind-body practice studios.
Additionally, the notes address related party transactions, specifically dealings with Body & Brain Yoga and Health Centers, Inc., the parent company. This includes advertising fund fee income, where Body & Brain Yoga and Health Centers, Inc. agrees to pay Body Brain Center an advertising fee of 0.5% of program sales, amounting to $58,783 for the year ended December 31, 2024. The notes also mention a software service agreement where Body Brain Center pays $400 per month to Body & Brain Yoga and Health Centers, Inc. for software services, totaling $4,800 for both 2024 and 2023.
Prospective franchisees should carefully review these notes to gain a deeper understanding of Body Brain Center's financial health, accounting practices, and relationships with related parties. Understanding these aspects can help franchisees assess the financial stability and operational structure of the franchise system.