What was the change in Cicis' accounts payable in 2024?
Cicis Franchise · 2025 FDDAnswer from 2025 FDD Document
| 2024 | 2023 | ||
|---|---|---|---|
| Cash flows from operating activities: | |||
| Net income | $ 4,210,079 | $ 5,859,705 | |
| Adjustments to reconcile net income to net cash provided by | |||
| operating activities: | |||
| Amortization | 57,149 | 38,816 | |
| Allowance for credit losses | 30,166 | - | |
| Changes in operating assets and liabilities: | |||
| Trade receivables | 4,787 | ( 139,264) | |
| Marketing fund, restricted | 142,369 | ( 981,151) | |
| Related party receivable | ( 616,187) | 753,587 | |
| Prepaid expenses and other current assets | ( 631,305) | 41,682 | |
| Other receivables | 46,123 | ( 2,952) | |
| Accounts payable | ( 413,045) | 305,641 | |
| Accounts payable—marketing fund, restricted | 68,880 | 182,889 | |
| Accrued expenses and other current liabilities | ( 115,228) | ( 754,380) | |
| Deferred franchise fees | 99,444 | 233,291 | |
| Related party payable | ( 596,796) | 427,267 | |
| Marketing fund liabilities, restricted | ( 423,715) | 1,407,044 | |
| Deferred initial beverage fund | ( 387,386) | ( 789,083) | |
| Net cash provided by operating activities | 1,475,335 | 6,583,092 | |
| Cash flows from investing activities: | |||
| Website | - | ( 120,000) | |
| Net cash used in investing activities | - | ( 120,000) | |
| Cash flows from financing activities: | |||
| Distributions to members | ( 2,889,567) | ( 8,300,000) | |
| Net cash used in financing activities | ( 2,889,567) | ( 8,300,000) | |
| Net decrease in cash, cash equivalents | |||
| and restricted cash | ( 1,414,232) | ( 1,836,908) | |
| Cash, cash equivalents and restricted cash: | |||
| Beginning | 3,703,166 | 5,540,074 | |
| Ending | $ 2,288,934 | $ 3,703,166 |
Source: Item 23 — RECEIPTS (FDD pages 65–263)
What This Means (2025 FDD)
According to Cicis' 2025 Franchise Disclosure Document, the company's accounts payable decreased by $413,045 in 2024, compared to an increase of $305,641 in 2023. This change reflects the difference in how Cicis managed its short-term obligations to suppliers and creditors between the two years.
For a prospective franchisee, this data point offers insight into Cicis' financial management practices. A decrease in accounts payable could suggest that Cicis paid its suppliers more quickly in 2024 than in the previous year. This could be due to improved cash flow management or a strategic decision to strengthen relationships with suppliers by paying them faster. Conversely, it could also indicate tighter credit terms from suppliers, requiring faster payment.
It's important to consider this change in the context of Cicis' overall financial performance. While a decrease in accounts payable might seem negative on its own, it could be a positive sign if it's accompanied by increased revenue or improved profitability. Franchisees should investigate the reasons behind this change and how it might impact their own operations. Understanding Cicis' payment practices and its relationships with suppliers is crucial for assessing the financial stability of the franchise system.
In addition to the general accounts payable, the FDD also lists "Accounts payable—marketing fund, restricted." This category showed an increase of $68,880 in 2024, compared to an increase of $182,889 in 2023. This indicates the marketing fund's specific payment activities and obligations, separate from the general accounts payable.