What was the change in accrued advertising expenses for Brain Balance in 2023?
Brain_Balance Franchise · 2025 FDDAnswer from 2025 FDD Document
| Years Ended December 31, 2024, 2023, and 2022 | ||||
|---|---|---|---|---|
| 2024 | 2023 | 2022 | ||
| Cash Flows from Operating Activities | ||||
| Net (loss) income | $(324,837) $ | 161,876 $ | 307,374 | |
| Adjustments to reconcile net (loss) income to net cash and | ||||
| restricted cash from operating activities: | ||||
| Depreciation and amortization | 49,819 | 29,920 | 24,806 | |
| Credit loss expense | 59,741 | 5,560 | - | |
| Changes in operating assets and liabilities that (used) | ||||
| provided cash and restricted cash: | ||||
| Accounts receivable | (126,097) | 42,623 | (75,804) | |
| Deferred franchise costs | 20,050 | 23,393 | 19,952 | |
| Prepaid expenses and other assets | (33,382) | (10,615) | 53,332 | |
| Accounts payable and accrued expenses | (66,584) | (46,246) | 81,063 | |
| Deferred revenue | 16,809 | (89,332) | (96,172) | |
| Accrued advertising expenses | (56,130) | (98,824) | 84,461 | |
| Net cash and restricted cash (used in) provided | ||||
| by operating activities | (460,611) | 18,355 | 399,012 | |
| Cash Flows from Investing Activities |
Source: Item 23 — RECEIPTS (FDD pages 72–292)
What This Means (2025 FDD)
According to Brain Balance's 2025 Franchise Disclosure Document, accrued advertising expenses decreased by $98,824 in 2023. This figure reflects the change in Brain Balance's accrued advertising expenses as reported on the company's financial statements for the year..
Accrued advertising expenses represent advertising costs that Brain Balance has incurred but not yet paid. The decrease suggests that Brain Balance paid off a significant portion of its outstanding advertising expenses during 2023. This could be due to a variety of factors, such as changes in advertising strategy, improved cash flow, or a decision to reduce advertising spending.
For a prospective Brain Balance franchisee, this information provides insight into the company's financial management and advertising practices. While a decrease in accrued advertising expenses can be a positive sign, it's important to consider the context. Franchisees should inquire about Brain Balance's advertising strategy and how advertising funds are managed to ensure that adequate resources are being allocated to promote the brand and support franchisee success. Understanding the fluctuations in advertising expenses can help franchisees assess the stability and effectiveness of Brain Balance's marketing efforts.