On what date did Focus Cfo commence its lease for office space?
Focus_Cfo Franchise · 2025 FDDAnswer from 2025 FDD Document
ch prior period balances were not restated and no adjustment to the opening balance of retained earnings was recognized. There were no leases requiring adjustment as of the date of adoption. The Company entered into its current lease agreement during 2022.
On December 31, 2022, the Company commenced a lease for office space which required the recording of a right of use asset and a related liability of $94,340 to reflect the economic value of an operating lease for office space. The Company used its incremental borrowing rate at the time of lease inception of 7.50% to estimate the economic value. The lease includes two months of zero rent and then monthly payments ranging from $1,935 to $1,993 through maturity in December 2027. Rent expense is recognized on the straight-line basis of all lease payments including those for extension periods that are likely to be exercised. The lease allows for three extension periods of two years each. Management is not currently able to predict if any of those terms will be exercised and therefore, have not included those periods in the calculation of th
Source: Item 23 — Receipts (FDD pages 37–126)
What This Means (2025 FDD)
According to Focus Cfo's 2025 Franchise Disclosure Document, the company commenced a lease for office space on December 31, 2022. This lease required Focus Cfo to record a right of use asset and a related liability of $94,340, reflecting the economic value of the operating lease. At the time of the lease inception, the company used an incremental borrowing rate of 7.50% to estimate the economic value.
The lease terms include an initial period of two months with zero rent, followed by monthly payments ranging from $1,935 to $1,993 until the lease matures in December 2027. Focus Cfo recognizes rent expense on a straight-line basis, considering all lease payments, including those for extension periods that are likely to be exercised. The lease agreement provides for three potential extension periods, each lasting two years.
As of 2024, there was no accumulated depreciation related to the right of use asset. The current portion of the right of use liability was $19,782, which was included in other current liabilities on the combined balance sheets. Prospective franchisees should note that these lease obligations are specific to Focus Cfo and that franchisees themselves will operate out of a home office or an office that the franchisee provides at its own expense.