How does C12 Group report its accounts receivable?
C12_Group Franchise · 2025 FDDAnswer from 2025 FDD Document
Notes to Consolidated Financial Statements December 31, 2022 and 2021
1. Nature of Operations
The C12 Group, LLC ("Company"), was organized on January 21, 2005. Effective September 1, 2016, the Company was converted to a Texas limited liability company from a North Carolina limited liability company.
The Company is a resource for Christian business owners, chief executive officers and presidents who are called to lead with excellence, integrity, and balance according to Biblical standards. The Company sells franchises to Area Chairs, who then build a C12 practice by recruiting group members from among local business leaders. At December 31, 2022, the Company had 157 Area Chairs, including Associate Chairs, serving over 174 metro areas located throughout the United States and approximately 3,600 group members across its various offerings: C12 Groups, Key Players and Mentors. The Company's business office is located in San Antonio, Texas.
In March 2017, the Company acquired 100% of C12 Atlanta LLC (C12 Atlanta), a franchisee of the Company.
In 2018, the Company entered into agreements to provide services in international markets via a licensing agreement and had functional licenses in Singapore, Malaysia and Brazil as of December 31, 2020.
2. Basis of Consolidation
The consolidated financial statements include the accounts of The C12 Group, LLC and C12 Atlanta, LLC. All significant inter-company account balances and transactions have been eliminated in the accompanying consolidated financial statements.
3. Summary of Significant Accounting Policies
Basis of Accounting
The consolidated financial statements are prepared in conformity with United States generally accepted accounting principles (GAAP).
Cash and Cash Equivalents
For purposes of reporting cash flows, the Company considers all highly liquid investments with original maturities of three months or less to be cash equivalents.
Accounts Receivable
Source: Item 22 — CONTRACTS (FDD page 46)
What This Means (2025 FDD)
According to C12 Group's 2025 Franchise Disclosure Document, the company's consolidated financial statements are prepared in conformity with United States generally accepted accounting principles (GAAP). For the purpose of reporting cash flows, C12 Group considers all highly liquid investments with original maturities of three months or less to be cash equivalents. The FDD mentions that the consolidated financial statements include the accounts of The C12 Group, LLC and C12 Atlanta, LLC, with all significant inter-company account balances and transactions eliminated.
Specifically regarding accounts receivable, the FDD lists it as one of the items included in the summary of significant accounting policies. However, the excerpt does not provide further details on how C12 Group specifically accounts for or values its accounts receivable, such as whether they use an allowance for doubtful accounts or any specific methods for recognizing revenue related to these receivables.
Prospective franchisees should inquire with C12 Group about the specific policies and procedures used to manage and report accounts receivable. Understanding these practices is crucial for assessing the financial health and stability of the company, as well as for managing their own finances as a franchisee.