What was the change in Cicis' prepaid expenses and other current assets in 2023?
Cicis Franchise · 2025 FDDAnswer from 2025 FDD Document
| 2023 | 2022 | ||
|---|---|---|---|
| Cash flows from operating activities: | |||
| Net income | $ 5,859,705 | $ 9,407,023 | |
| Adjustments to reconcile net income to net cash | |||
| provided by operating activities: | |||
| Amortization | 13,149 | 13,149 | |
| Changes in operating assets and liabilities: | |||
| Trade receivables | 186,610 | (73,448) | |
| Marketing fund, restricted | (1,307,025) | 1,045,443 | |
| Related party receivable | 753,587 | (502,090) | |
| Prepaid expenses and other current assets | 41,682 | 532,467 | |
| Other receivables | (2,952) | 226,453 | |
| Accounts payable | 305,641 | 90,785 | |
| Accounts payable—marketing fund, restricted | 182,889 | (636,450) | |
| Accrued expenses and other current liabilities | (754,380) | 668,395 | |
| Deferred franchise fees | 233,291 | 325,663 | |
| Related party payable | 427,267 | (49,523) | |
| Marketing fund liabilities, restricted | 1,407,044 | (2,623,924) | |
| Other noncurrent liabilities | (789,083) | (775,153) | |
| Net cash provided by operating activities | 6,557,425 | 7,648,790 | |
| Cash flows from investing activities: | |||
| Website in development | (94,333) | (100,000) | |
| Net cash used in investing activities | (94,333) | (100,000) | |
| Cash flows from financing activities: | |||
| Distributions to members | (8,300,000) | (7,277,500) | |
| Net cash used in financing activities | (8,300,000) | (7,277,500) | |
| Net (decrease) increase in cash, cash equivalents | |||
| and restricted cash | (1,836,908) | 271,290 | |
| Cash, cash equivalents and restricted cash: | |||
| Beginning of year | 5,540,074 | 5,268,784 | |
| End of year | $ 3,703,166 | $ 5,540,074 |
Source: Item 23 — RECEIPTS (FDD pages 65–263)
What This Means (2025 FDD)
According to Cicis' 2025 Franchise Disclosure Document, in 2023, the company's prepaid expenses and other current assets increased by $41,682, while in 2022, the same category showed $532,467. This indicates a significant decrease in prepaid expenses and other current assets from 2022 to 2023.
For a prospective franchisee, this line item reflects the changes in short-term assets like insurance premiums, rent, and supplies that Cicis has already paid for but not yet fully consumed. The decrease from $532,467 in 2022 to $41,682 in 2023 could signal changes in how Cicis manages these assets, potentially impacting the franchisee's initial investment and ongoing operational costs.
It's important for potential franchisees to understand the reasons behind this change. A decrease might suggest more efficient management of prepaid expenses, but it could also indicate a shift in payment schedules or a reduction in certain operational investments. Further clarification from Cicis on these figures would be beneficial for making informed financial projections.