When does Epcon Communities recognize royalty income from franchisee sales?

According to Epcon Communities' 2025 Franchise Disclosure Document, the company recognizes revenue when a performance obligation has been satisfied. This occurs when control of promised products or services is transferred to customers, with the revenue amount reflecting the consideration Epcon Communities expects to receive in exchange for those products or services.

For a prospective franchisee, this means that Epcon Communities recognizes its revenue (including royalties) at the point when they have fulfilled their obligation by providing the services or products to the customer. This is a standard accounting practice, but it's important for franchisees to understand when Epcon Communities recognizes revenue, as it can impact financial reporting and the overall financial relationship between the franchisee and franchisor.

This policy is further detailed in the notes to the consolidated financial statements, emphasizing the use of estimates and assumptions in preparing these statements. Actual results could differ from these estimates. Therefore, franchisees should be aware that the revenue recognition policy is subject to interpretation and can be influenced by various factors.