When are accounts receivable written off by Counselor Realty?
Counselor_Realty Franchise · 2025 FDDAnswer from 2025 FDD Document
t rates and interest rates, amongst others.
Accounts receivable consists of franchise related fees. Accounts receivable are unsecured and the Company charges 8% interest on past due accounts. Accounts receivable are considered past due if not paid within the terms established. Accounts receivable are written off when they are determined to be uncollectible. The allowance for credit losses was $1,574 and $3,724 as
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 32)
What This Means (2025 FDD)
According to Counselor Realty's 2025 Franchise Disclosure Document, accounts receivable, which consist of franchise-related fees, are written off when Counselor Realty determines they are uncollectible. These receivables are unsecured, and the company charges an 8% interest on past due accounts. An account is considered past due if payment is not made within the established terms.
For a prospective franchisee, this means that Counselor Realty has a process for dealing with unpaid fees from franchisees. The company does not indefinitely carry debts that are unlikely to be paid. Instead, it writes them off, which can impact the company's financial statements. The FDD notes that the allowance for credit losses was $1,574 as of December 31, 2024, and $3,724 as of December 31, 2023.
It is important to note that Counselor Realty actively manages its accounts receivable by charging interest on overdue amounts and setting up an allowance for potential credit losses. This indicates a proactive approach to managing financial risks associated with franchisee payments. Franchisees should ensure they understand the payment terms and the consequences of late payments to avoid incurring interest charges or contributing to the company's potential write-offs of uncollectible accounts.