What was the amount of advances from (to) affiliates for City Publications during the year ended December 31, 2024?
City_Publications Franchise · 2025 FDDAnswer from 2025 FDD Document
Debt expense | 312 | - | 26,102 | | | Depreciation expense | 3,000 | 3,000 | 3,000 | | | TOTAL OPERATING EXPENSES | 1,140,130 | 1,172,585 | 1,153,845 | | | OPERATING INCOME | 273,141 | 99,917 | (13,378) | | | OTHER (EXPENSE) | | | | | | Interest expense | (9,194) | (414) | (460) | | | NET INCOME | $ 263,947 | $ 99,503 | $ (13,838) | |
CITY PUBLICATIONS FRANCHISE GROUP, INC. CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' (DEFICIT) FOR THE YEARS ENDED DECEMBER 31, 2024, 2023 AND 2022
| Common Stock | Additional Paid-In Capital | Due From Affiliates | Retained Earnings | Total Shareholders' (Deficit) | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| BALANCE, DECEMBER 31, 2021 | $ 1,000 | $ | 17,000 | $ (1,770,163) | $ 1,715,261 | $ (36,902) | |||||
| Advances from (to) affiliates | (11,790) | (11,790) | |||||||||
| Capital (distributions) | (72,470) | (72,470) | |||||||||
| Net (loss) | (13,838) | (13,838) | |||||||||
| BALANCES, DECEMBER 31, 2022 | 1,000 | 17,000 | (1,781,953) | 1,628,953 | (135,000) | ||||||
| Advances from (to) affiliates | - | - | (67,140) | - | (67,140) | ||||||
| Capital additions | - | - | - | 17,027 |
Source: Item 23 — RECEIPT (FDD pages 39–129)
What This Means (2025 FDD)
According to City Publications' 2025 Franchise Disclosure Document, during the year ended December 31, 2024, City Publications had advances from (to) affiliates of ($145,012). This means that City Publications provided $145,012 to support its affiliate operations during this period.
These advances are notable because they bear no interest and have no specified repayment terms. They are classified as a component of shareholders' (deficit) because the affiliates are under common control through common ownership. This arrangement suggests a close financial relationship between City Publications and its affiliates, where funds are transferred without the usual expectations of interest or strict repayment schedules.
A prospective franchisee should consider the implications of these related-party transactions. While it may not directly impact their day-to-day operations, it provides insight into the financial structure and relationships within the City Publications network. Understanding these financial dynamics can help a franchisee assess the overall stability and interconnectedness of the City Publications franchise system.
It's also worth noting that advances due from affiliates as of December 31, 2024, totaled $1,994,105. This figure represents the cumulative amount of advances that affiliates owe to City Publications, highlighting the scale of financial interactions within the related entities.