For Checkersrallys, what is the amortization period for prepaid expenses?

According to Checkersrallys's 2025 Franchise Disclosure Document, prepaid expenses such as rent, insurance, maintenance, equipment, software, and service agreements are capitalized when paid. These prepaid expenses are then amortized over the period in which the services are provided.

For a Checkersrallys franchisee, this means that if you prepay for any of the listed expenses, you won't be able to deduct the full amount immediately for accounting purposes. Instead, you'll spread the deduction over the service period.

The amortization period for these prepaid expenses will not exceed one year. This is a common practice, as it aligns the expense recognition with the actual consumption of the prepaid services or goods. This ensures that the financial statements accurately reflect the expenses incurred during a specific period.