What was the service cost for Budget's pension plans as of December 31, 2023?
Budget Franchise · 2025 FDDAnswer from 2025 FDD Document
y. For the year ended December 31, 2022, $1 million was included in selling, general and administrative
expenses. (b) Included in selling, general and administrative expenses.
Net funded status
We use a measurement date of December 31st for our pension plans. The funded status of the pension plans were as follows:
| | As of December 31, | | | | | | | |----------------------
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 79)
What This Means (2025 FDD)
According to Budget's 2025 Franchise Disclosure Document, the service cost for their pension plans as of December 31, 2023, was $27 million. This figure represents the cost of benefits earned by employees during that year under Budget's defined benefit pension plans.
For a prospective franchisee, this information provides insight into Budget's employee benefits structure and its financial obligations related to pension plans. While this cost is borne by Budget, understanding these financial commitments can offer a broader view of the company's overall financial health and stability. Pension obligations are a long-term liability for Budget, and the service cost is an annual expense that contributes to these obligations.
The FDD also includes service cost information for the years 2024 ($28 million) and 2022 ($3 million). Reviewing these figures over multiple years can help to identify trends and potential fluctuations in Budget's pension-related expenses. This information is part of the overall financial picture that a potential franchisee should consider when evaluating the franchise opportunity.