How does Crave Cookies state its accounts receivable on its financial statements?
Crave_Cookies Franchise · 2025 FDDAnswer from 2025 FDD Document
Contract receivables - accounts receivable are stated at the amount of consideration from customers of which the Company has an unconditional right to receive. The Company provides an allowance for credit losses, which is based upon a review of outstanding receivables, historical collection information and existing economic conditions. As of December 31, 2024, there was no allowance for credit losses recorded.
Generally, the Company does not charge interest on past due accounts. Delinquent receivables are written off based on individual credit evaluation and specific circumstances of the customer. During the year ended December 31, 2024, there was no credit loss expense related to doubtful accounts receivable, where collectability was not reasonably assured.
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 47)
What This Means (2025 FDD)
According to Crave Cookies' 2025 Franchise Disclosure Document, the company states its accounts receivable at the amount of consideration from customers for which it has an unconditional right to receive. Crave Cookies provides an allowance for credit losses, which is based upon a review of outstanding receivables, historical collection information, and existing economic conditions. As of December 31, 2024, there was no allowance for credit losses recorded.
Generally, Crave Cookies does not charge interest on past due accounts. Delinquent receivables are written off based on individual credit evaluation and specific circumstances of the customer. During the year ended December 31, 2024, there was no credit loss expense related to doubtful accounts receivable, where collectability was not reasonably assured.
For a prospective franchisee, this means that Crave Cookies aims to accurately reflect the money owed to them by customers in their financial statements. They also actively monitor their receivables and set aside an allowance for potential losses, although no such allowance was deemed necessary as of December 31, 2024. This indicates a proactive approach to managing credit risk and maintaining the integrity of their financial reporting. The company's policy of not charging interest on past due accounts and writing off delinquent receivables based on individual circumstances suggests a customer-focused approach to collections.