Does Clean Your Dirty Face's accounts receivable bear interest?
Clean_Your_Dirty_Face Franchise · 2025 FDDAnswer from 2025 FDD Document
Accounts receivable are carried at their estimated realizable amount and do not bear interest. Receivables generally consist of royalty revenue, which is based on a percentage of franchise monthly gross sales, and are typically collected the month subsequent to the month in which the royalties are earned.
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 54)
What This Means (2025 FDD)
According to Clean Your Dirty Face's 2025 Franchise Disclosure Document, the company's accounts receivable do not bear interest. These receivables primarily consist of royalty revenue, which is calculated as a percentage of the franchisees' monthly gross sales. Typically, Clean Your Dirty Face collects these royalties in the month following the month in which they are earned.
This policy means that franchisees will not be charged interest on any outstanding royalty payments. This could be beneficial for franchisees as it provides a grace period for settling royalty obligations without incurring additional costs.
However, it is important for prospective franchisees to ensure timely payment of royalties to maintain a good financial standing with Clean Your Dirty Face and avoid any potential repercussions for late payments, even though interest is not charged. Franchisees should also clarify with Clean Your Dirty Face the specific procedures and deadlines for royalty payments to ensure compliance and avoid any misunderstandings.