When does Checkers expense advertising costs for on-air advertising?
Checkers Franchise · 2025 FDDAnswer from 2025 FDD Document
The Company expenses advertising costs for on-air advertising at the first time aired and advertising costs for on-lot merchandising on the first day of advertising. To the extent the Company participates in independent advertising cooperatives, the Company expenses contributions as incurred.
Advertising expense does not include expenses incurred for coupons and discounts, which are recorded as reductions to restaurant sales at the time of sale.
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 91)
What This Means (2025 FDD)
According to Checkers' 2025 Franchise Disclosure Document, the company expenses advertising costs for on-air advertising at the first time the advertisement is aired. Additionally, Checkers expenses advertising costs for on-lot merchandising on the first day of advertising.
For a prospective Checkers franchisee, this means that Checkers recognizes the expense of on-air advertising as soon as the advertisement is broadcasted for the first time. This accounting practice provides a clear and immediate reflection of advertising expenses on the company's financial statements.
Furthermore, Checkers participates in independent advertising cooperatives and expenses contributions to these cooperatives as they are incurred. However, expenses for coupons and discounts are not included in advertising expenses but are recorded as reductions to restaurant sales at the time of the sale.