What was the change in net internal-use software from 2022 to 2023 for Expense Reduction Analysts?
Expense_Reduction_Analysts Franchise · 2025 FDDAnswer from 2025 FDD Document
--| | Furniture and Fixtures | | 15,718 | | 20,163 | | Total Property and Equipment | | 33,748 | | 33,129 | | Less: Accumulated Depreciation | | (14,978) | | (17,588) | | Property and Equipment - Net | $ | 18,770 | $ | 15,541 |
NOTE 4 INTERNAL-USE SOFTWARE
Internal-Use Software is amortized on a straight-line basis over the estimated useful lives of the asset of 10 years. Software development costs of $35,430 and $40,834 were capitalized and included in Internal-Use Software on the balance sheets f
Source: Item 23 — RECEIPTS (FDD pages 58–215)
What This Means (2025 FDD)
According to Expense Reduction Analysts' 2025 Franchise Disclosure Document, software development costs of $40,834 were capitalized and included in Internal-Use Software on the balance sheets for the year ended December 31, 2022. For the year ended December 31, 2023, $35,430 was capitalized and included in Internal-Use Software. This represents a decrease of $5,404 in capitalized internal-use software from 2022 to 2023.
In 2022, the asset was under development and not depreciated. Depreciation began in 2023 when the software was put into use. A depreciation expense of $6,832 was charged to operations in the year ending December 31, 2023.
For a prospective franchisee, this indicates Expense Reduction Analysts is continuing to invest in its internal-use software, though at a slightly reduced rate in 2023 compared to 2022. The capitalization and subsequent depreciation of this software is a standard accounting practice, spreading the cost of the asset over its useful life (estimated to be 10 years).