Are the financial statements in the Brain Balance FDD consolidated or unconsolidated?
Brain_Balance Franchise · 2025 FDDAnswer from 2025 FDD Document
BB Franchising, LLC (the "Company"), a Delaware limited liability company, was formed on November 13, 2007 as a wholly owned subsidiary of Brain Balance Holdings, Inc. (the "Parent"). At December 31, 2024, the Parent also owns BB Corporate, LLC. The Parent provides funds for operational needs of the Company. The operating results could vary significantly if the Company operated independently of the Parent. Accordingly, this affiliation and other related party disclosures must be taken into consideration in reviewing the accompanying financial statements.
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 70)
What This Means (2025 FDD)
According to Brain Balance's 2025 Franchise Disclosure Document, the financial statements provided are for BB Franchising, LLC, which is a wholly-owned subsidiary of Brain Balance Holdings, Inc. The FDD states that at December 31, 2024, Brain Balance Holdings, Inc. also owns BB Corporate, LLC. The document explicitly mentions that the Parent company, Brain Balance Holdings, Inc., provides funds for the operational needs of BB Franchising, LLC.
The FDD emphasizes that the operating results of BB Franchising, LLC could significantly differ if it operated independently of its parent company. Therefore, the affiliation with Brain Balance Holdings, Inc. and related party disclosures should be carefully considered when reviewing the financial statements.
Given that the financial statements are specifically for BB Franchising, LLC, and the document highlights the relationship with its parent company, Brain Balance Holdings, Inc., these financial statements are unconsolidated. They reflect the financial performance of the subsidiary alone, without combining the financials of the parent company or other related entities.