What consulting fees does the Gokhale Method pay to its parent entity?
Gokhale_Method Franchise · 2024 FDDAnswer from 2024 FDD Document
related parties are as follows:
| Transactions incurred | 4.752 | mber 31, 021 | De | cember 31, 2020 | |
|---|---|---|---|---|---|
| Gokhale Method Enterprise Inc | Management fee | $ | 49,300 | S | 33,797 |
Outstanding balances with related parties are as follows:
| Accounts | mber 31, 2021 | De | cember 31, 2020 | ||
|---|---|---|---|---|---|
| Gokhale Metho |
Source: Item 22 — CONTRACTS (FDD page 34)
What This Means (2024 FDD)
According to the 2024 Gokhale Method Franchise Disclosure Document, Gokhale Method Institute, Inc. (GMI) does not pay consulting fees to its parent entity, Gokhale Method Enterprise, Inc. (GME). Instead, GMI incurs a 'Management fee' to GME.
The FDD provides specific figures for these management fees for the years 2020, 2021, and 2022. In 2020, the management fee was $33,797. This increased to $49,300 in 2021, then decreased to $26,100 in 2022. These fees reflect payments from the subsidiary, GMI, to its parent company, GME, for management services rendered.
Prospective franchisees should note that these fees are subject to change and may impact the overall financial performance of GMI. Reviewing the historical trend of these fees can offer insights into the financial relationship between GMI and GME. It is important to note that the FDD does not provide a breakdown of what specific services are covered under this 'Management fee'. A prospective franchisee should seek clarification from Gokhale Method regarding the nature and scope of these management services to fully understand the financial implications.