How does Canine Dimensions evaluate the risk associated with cash balances exceeding the FDIC limit?

According to Canine Dimensions' 2025 Franchise Disclosure Document, the company acknowledges that it maintains cash account balances at financial institutions that may, at times, exceed the Federal Deposit Insurance Corporation (FDIC) limit of $250,000. To manage this risk, Canine Dimensions states that it continuously evaluates the potential exposure. As of the date the financial statements were available to be issued, Canine Dimensions believed it was not exposed to any significant credit risks related to these cash balances.

For a prospective Canine Dimensions franchisee, this means that the franchisor's financial management includes monitoring and assessing the risk associated with cash holdings above the FDIC insurance limit. While the FDD indicates that Canine Dimensions believes the risk is not significant, franchisees should understand that balances above $250,000 are not insured by the FDIC, which could pose a risk in the unlikely event of a bank failure.

It is common practice for businesses, including franchisors, to manage their cash balances across multiple accounts or utilize other financial instruments to mitigate the risk of exceeding FDIC limits. Franchisees may want to inquire about Canine Dimensions' specific strategies for managing cash and mitigating risks associated with balances exceeding the FDIC insurance limit to gain a better understanding of their financial practices.