Over what period does Brightstar Care amortize its capitalized software costs?
Brightstar_Care Franchise · 2025 FDDAnswer from 2025 FDD Document
tify any impairment of its property and equipment at December 29, 2024 or December 31, 2023.
Internally Developed Software
The Company capitalizes certain costs of software developed or obtained for use of its franchises. Capitalized software costs consist of salaries and related compensation costs of employees and consultants for certain projects that qualify for capitalization. The capitalized software costs are amortized on a straight-line basis over the expected useful lives, which are gene
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 117)
What This Means (2025 FDD)
According to Brightstar Care's 2025 Franchise Disclosure Document, the company amortizes its capitalized software costs over a period of 60 months using the straight-line method. These costs include salaries and related compensation for employees and consultants involved in software development or acquisition for use by its franchises.
For a prospective Brightstar Care franchisee, this means that the costs associated with software developed or obtained by the company for franchise use are spread out evenly over a five-year period (60 months) for accounting purposes. This amortization schedule affects the company's financial statements, specifically how these software costs are recognized as expenses over time.
As of December 29, 2024, Brightstar Care had capitalized $2,575,001 in software costs, and as of December 31, 2023, the capitalized costs were $2,071,727. This indicates the level of investment Brightstar Care is making in software and technology for its franchise system. The amortization of these costs is a standard accounting practice that allows the company to systematically recognize the expense of these assets over their useful life.