What was the amount of deemed dividend, net, for Brightstar Care at the end of the fiscal year 2023?
Brightstar_Care Franchise · 2025 FDDAnswer from 2025 FDD Document
| Fiscal year ended | 2023 | 2023 |
|---|---|---|
| Cash Flows from Operating Activities | ||
| Net income | $ 17,922,426 | $ 12,872,990 |
| Adjustments to reconcile net income to net cash | ||
| provided by operating activities: | ||
| Depreciation and amortization expense | 1,992,427 | 1,741,168 |
| Bad debt expense | 344,476 | 255,220 |
| Non-cash change in operating leases | 405,955 | 329,349 |
| Net change in assets and liabilities: | ||
| Accounts receivable | (1,159,680) | 112,251 |
| Prepaid expenses | (894,269) | (16,245) |
| Inventory | 74,793 | 3,830 |
| Other current assets | 289,201 | (339,327) |
| Operating lease liabilities | (482,686) | (440,160) |
| Accounts payable | 102,163 | 1,085,594 |
| Accrued salaries and payroll tax | 614,843 | (990,600) |
| Other current liabilities | 252,188 | 98,225 |
| Net Cash Provided by Operating Activities | 19,461,837 | 14,712,295 |
| Cash Flows from Investing Activities | ||
| Notes receivable - affiliated companies | (16,272,451) | (21,026,205) |
| Purchase of property and equipment | (2,939,036) | (2,978,301) |
| Net Cash Used in Investing Activities | (19,211,487) | (24,004,506) |
| Net Increase (Decrease) in Cash and Cash Equivalents | 250,350 | (9,292,211) |
| Cash and Cash Equivalents, beginning of year | 16,868 | 9,309,079 |
| Cash and Cash Equivalents, end of year | $ 267,218 | $ 16,868 |
| Supplemental Non-Cash Disclosures | ||
| Deemed dividend, net | $ (24,307,339) | $ (18,934,514) |
Source: Item 23 — RECEIPTS (FDD pages 118–387)
What This Means (2025 FDD)
According to Brightstar Care's 2025 Franchise Disclosure Document, the deemed dividend, net, for the fiscal year ended December 31, 2023, was $(24,307,339). This figure represents a non-cash transaction that affects the company's cash flow statement.
In simple terms, a deemed dividend is a distribution of value to the owners (equity holders) of Brightstar Care, which is treated as a dividend for accounting purposes, even though it may not be an actual cash payment. This can occur through various transactions, such as the transfer of assets or liabilities between related parties. The negative value indicates that the deemed dividend resulted in a decrease in cash flow.
For a prospective Brightstar Care franchisee, this information provides insight into the financial transactions and distributions made by the company to its owners. While it's a non-cash item, it reflects the financial management and capital structure decisions made by Brightstar Care. Understanding these transactions can help a franchisee assess the financial stability and practices of the franchisor.