What was the change in trade receivables for Cicis in 2023?
Cicis Franchise · 2025 FDDAnswer from 2025 FDD Document
s | (2,889,567) | | Net income | 4,210,079 | | | | | Balance, December 31, 2024 | $ 2,423,224 |
Combined Statements of Cash Flows Years Ended December 31, 2024 and 2023
| 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 restri |
Source: Item 20 — OUTLETS AND FRANCHISEE INFORMATION (FDD pages 58–64)
What This Means (2025 FDD)
According to Cicis's 2025 Franchise Disclosure Document, the trade receivables experienced a decrease of $139,264 in 2023. This figure is part of the broader "Changes in operating assets and liabilities" section within the cash flow statement. In 2022, the trade receivables change was $186,610. This indicates a significant shift in how Cicis managed its receivables between the two years.
For a prospective franchisee, this data point highlights the fluctuations in Cicis's operating assets. Trade receivables typically represent the money owed to a company by its customers for goods or services already delivered. A negative change, as seen in 2023, could suggest tighter credit policies, quicker collections, or potentially lower sales on credit. Understanding the reasons behind these changes is crucial for assessing the financial health and operational efficiency of Cicis.
Franchisees should inquire about the factors contributing to these changes. For instance, were there specific initiatives to improve collection times, or did economic conditions affect customer payment behavior? Furthermore, comparing these figures with industry benchmarks can provide a more comprehensive understanding of Cicis's performance in managing its trade receivables. This information will help franchisees better anticipate and manage their own cash flow and financial planning within the Cicis system.