Does Cinch I.T. maintain its cash balance at a federally insured institution?

According to Cinch I.T.'s 2024 Franchise Disclosure Document, the company's policy is to prepare its financial statements on the accrual basis of accounting, recognizing revenues when earned and expenses when the obligation is incurred. The FDD states that cash includes all cash balances and highly liquid investments with an initial maturity of three months or less.

However, the document does not explicitly state whether Cinch I.T. maintains its cash balances at a federally insured institution. This is a common practice for businesses to ensure the safety of their funds, up to the limits insured by the FDIC (Federal Deposit Insurance Corporation) or similar government agencies.

A prospective Cinch I.T. franchisee should directly ask the franchisor whether its cash balances are held in federally insured institutions to understand the level of security for the company's funds. This information can provide reassurance about the financial stability and risk management practices of the franchisor.