Does the text specify if the financial statements of Checkersrallys include a schedule of other income and expenses?
Checkersrallys Franchise · 2025 FDDAnswer from 2025 FDD Document
The Company and its franchisees each pay a percentage of sales to the Checkers/Rally's National Production Fund, Inc. (the "Fund" or "NPF"), established for the purpose of creating and producing advertising for the benefit of both Company-operated and franchised restaurants. During the fiscal year ended December 30, 2024 (Successor) and the periods ended January 1, 2024 (Successor) and June 16, 2023 (Predecessor), only one member, representing 25% of the Board of Directors of the Fund, is an employee of the Company. The Fund is not included in the accompanying consolidated financial statements, although the Company's contributions to the Fund are included in advertising expense in the accompanying consolidated statements of operations. Additionally, certain Company-operated restaurants and franchisees participate in advertising co-ops. The Company consolidates advertising co-ops for which it is determined to control on the basis of voting interests, and does not consolidate advertising co-ops it does not control. Co-ops not controlled by the Company are accounted for similarly to the fund. The
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
contributions to the Fund represent 0.5% of net restaurant sales, while contributions to the advertising co-ops range from 0.5% to 4.25% of net restaurant sales.
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 91)
What This Means (2025 FDD)
Based on the 2025 Franchise Disclosure Document, the provided excerpts relating to Checkersrallys' financial statements do not explicitly state whether the financial statements include a schedule of other income and expenses. The excerpts focus on accounting policies, related party transactions, and consolidated statements of cash flow. These sections detail how Checkersrallys handles estimates, leases, transactions with related parties like the National Production Fund and Checkers and Rally's Distribution and Services, Inc. (CDSI), and the presentation of cash flow activities.
Specifically, the excerpts detail how Checkersrallys accounts for contributions to the National Production Fund (NPF) and Checkers and Rally's Distribution and Services, Inc. (CDSI), which are related party transactions. The contributions to the Fund represent 0.5% of net restaurant sales, while contributions to the advertising co-ops range from 0.5% to 4.25% of net restaurant sales. These contributions are included in "advertising expense" and "restaurant food and paper costs" respectively, within the consolidated statements of operations. The consolidated statements of cash flows provide an overview of the company's cash inflows and outflows, categorized into operating, investing, and financing activities.
To determine whether Checkersrallys includes a schedule of other income and expenses in its financial statements, a prospective franchisee should review the full financial statements included in the FDD or ask the franchisor directly. This schedule would provide a more detailed breakdown of income and expenses beyond the primary revenue and cost categories, offering additional insight into the financial performance of Checkersrallys.