When are accounts written off against the allowance for Gold Star?

According to Gold Star's 2025 Franchise Disclosure Document, accounts are written off against the allowance when Gold Star management deems them uncollectible. This practice relates to accounts receivable, which are amounts due from customers that are generally unsecured.

Gold Star establishes an allowance for credit losses to account for potentially uncollectible receivables. This allowance is the company's best estimate of probable credit losses, based on historical loss patterns, the number of days billings are past due, and an evaluation of the risk associated with specific accounts. The determination of when an account is past due is based on the terms indicated on customer contracts and invoices.

For a prospective Gold Star franchisee, this means that Gold Star handles the process of determining when customer accounts are no longer collectible and writing them off. Franchisees should ensure they understand the terms of customer contracts and invoices to properly manage accounts receivable and avoid disputes over past-due amounts. Recoveries of accounts receivable previously written off are recorded when received, and Gold Star does not charge interest on past due receivables.