What 'other' revenue did the Gokhale Method recognize as of December 31, 2021?
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 |
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") recognized a management fee from Gokhale Method Enterprise Inc. of $49,300 as of December 31, 2021. This fee represents a transaction incurred between the two related entities.
For a prospective franchisee, this indicates that Gokhale Method's revenue is derived not only from franchisees but also from management fees charged to its parent company. This related-party transaction suggests a financial relationship between GMI and its parent company, GME.
Understanding the nature and magnitude of these related-party transactions can be crucial for assessing the overall financial health and stability of Gokhale Method. A potential franchisee might want to inquire about the specific services provided in exchange for the management fee and how these fees are determined to ensure transparency and fairness.