How much in non-refundable franchise fees did City Publications defer in 2024?
City_Publications Franchise · 2025 FDDAnswer from 2025 FDD Document
l recently issued Accounting Standards Updates ("ASU"). The adoption of the recently issued ASUs, including those not yet effective, is not anticipated to have a material effect on the financial position or results of operations of the Company.
NOTE 2 – CONTRACTS WITH CUSTOMERS
The Company has recorded a liability for unearned revenue associated with the performance obligation of the Company's franchise agreements. The account bala
Source: Item 23 — RECEIPT (FDD pages 39–129)
What This Means (2025 FDD)
According to City Publications' 2025 Franchise Disclosure Document, the company deferred $59,400 in non-refundable franchise fees during the year 2024. This figure represents the total amount of franchise fees that City Publications collected but did not recognize as revenue during that year, instead deferring the recognition to a later period. This is a common accounting practice, especially when the franchisor has ongoing obligations to the franchisee.
The deferred franchise fees are part of City Publications' overall financial picture, as detailed in the provided financial statements. The beginning balance of deferred non-refundable franchise fees for 2024 was $56,679. During the year, $59,400 was deferred, and $34,253 was recognized. This resulted in an ending balance of $81,826 in deferred non-refundable franchise fees at the end of 2024.
For a prospective City Publications franchisee, this information provides insight into the company's revenue recognition practices and financial stability. It indicates that City Publications may have ongoing obligations to franchisees that justify deferring the recognition of franchise fees. Understanding these accounting practices can help a potential franchisee assess the financial health and transparency of City Publications.