Does Chocolate Fish Coffee exceed the amount of insurance provided on its cash deposits?
Chocolate_Fish_Coffee Franchise · 2024 FDDAnswer from 2024 FDD Document
Financial instruments that potentially subject the Company to credit risk consist of cash and cash equivalents. The Company places its cash and any cash equivalents with a limited number of high-quality financial institutions and do not exceed the amount of insurance provided on such deposits.
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 41)
What This Means (2024 FDD)
According to Chocolate Fish Coffee's 2024 Franchise Disclosure Document, the company addresses its policies regarding cash and cash equivalents. The document states that Chocolate Fish Coffee places its cash and cash equivalents with a limited number of high-quality financial institutions.
Importantly, Chocolate Fish Coffee states that it does not exceed the amount of insurance provided on such deposits. This indicates that the company is aware of the risks associated with holding cash and cash equivalents and takes steps to mitigate those risks by ensuring that its deposits are fully insured.
For a prospective franchisee, this information provides assurance that Chocolate Fish Coffee is managing its finances responsibly and is not taking unnecessary risks with its cash holdings. This can be a positive factor for franchisees who are considering investing in the Chocolate Fish Coffee brand.