Does the Gokhale Method FDD table provide information about the company's related parties?
Gokhale_Method Franchise · 2024 FDDAnswer from 2024 FDD Document
NOTE 1 – NATURE OF OPERATIONS
Gokhale Method Institute, Inc. ("GMI") was incorporated in 2011 as a California Sub-Chapter S Corporation by Gokhale Method Enterprises, Inc. ("GME"). The subsidiary was formed to franchise the Gokhale Method of dealing with back issues. GMI operates as a business and grants franchises for businesses offering classes and products that help restore the body's primal architecture and movement patterns under the "Gokhale Method" trademarks and related marks. GMI grants franchise licenses in a number of states and countries to practitioners who conduct classes in their franchise area in an accordance with Gokhale Method.
NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
General and Basis of Presentation
This summary of significant accounting policies of the Company is presented to assist in understanding the Company's financial statements. The financial statements and notes are representations of the Company's management, who is responsible for their integrity and objectivity. These accounting policies conform to accounting principles generally accepted in United States of America ("U.S. GAAP") and have been consistently applied in the preparation of the financial statements.
Use of Estimates
Management of the Company has made certain estimates and assumptions relating to the reporting of assets, liabilities, results of operations, and the disclosure of contingent assets and liabilities to prepare these financial statements in accordance with accounting principles generally accepted in the United States of America. Actual results could differ from these estimates.
Cash and Cash Equivalents
For purposes of the statement of cash flows, the Company considers all highly liquid investments and investments with original maturities of three months or less to be cash equivalents. Cash and cash equivalents consist of cash on hand.
Accounts Receivable and the Allowance for Doubtful Accounts
Accounts receivable is primarily comprised of net royalties' receivables from franchise, teachers or class fees collected by GME.
Source: Item 22 — CONTRACTS (FDD page 34)
What This Means (2024 FDD)
According to the 2024 Gokhale Method FDD, while there isn't a specific table dedicated to related parties, the document does provide some information regarding the relationship between Gokhale Method Institute, Inc. and its parent company. Note 1 of the financial statements indicates that Gokhale Method Institute, Inc. ("GMI") was incorporated in 2011 by Gokhale Method Enterprises, Inc. ("GME").
This means that Gokhale Method Institute, Inc. is a subsidiary of Gokhale Method Enterprises, Inc. and was formed to franchise the Gokhale Method. The FDD also notes that accounts receivable is primarily comprised of net royalties' receivables from franchise, teachers or class fees collected by GME.
Prospective franchisees should be aware of this relationship, as it could impact various aspects of the franchise, including financial reporting and the flow of funds. While the FDD doesn't offer a comprehensive table of all related parties, it does disclose the crucial relationship between the franchise system and its parent company, Gokhale Method Enterprises, Inc.