What was the change in deposits for Gold Star in the year ended December 31, 2022?
Gold_Star Franchise · 2025 FDDAnswer from 2025 FDD Document
| Years Ended December 31, | |||
|---|---|---|---|
| 2024 2023 | (Restated) | ||
| Cash Flows From Operating Activities | |||
| Net Income | $ 2,498,270 $ 1,595,317 | $ 1,936,301 | |
| Reconciliation of Net Income with | |||
| Cash Flows From Operations | |||
| Depreciation | 1,249,072 930,216 | 807,295 | |
| Amortization | 63,323 | 70,168 69,297 | |
| Amortization on Loan Cost | 1 3,492 4 1,695 | 1 2,973 | |
| Loss on Disposal of Property and Equipment | - 4 4,694 | 5,367 | |
| Gain on Early Termination of Lease | - (26,298) | - | |
| Changes In | |||
| Accounts Receivable, Net | 206,833 292,502 | 524,429 | |
| Other Receivables | (589) 229,976 | (67,494) | |
| Inventory | 4 83,139 (354,258) | (479,542) | |
| Prepaid Expenses | 272,464 227,946 | (269,624) | |
| Contract Assets | - 3 6,849 | 1 14,057 | |
| Deposits | 1 43,766 1 0,156 | (239,834) | |
| Right of Use Asset - Operating Leases | 9 75,114 8 81,258 | 6 10,647 | |
| Operating Lease Liabilities | (790,746) (765,735) | (517,628) | |
| Bank Overdraft | - (432,410) | 4 32,410 | |
| Accounts Payable Operating | (755,131) 1,041,601 | (409,194) | |
| Gift Card Liability | 6,158 2,909 | 6,744 | |
| Deferred Franchise Fees | (17,826) (26,558) | (14,609) | |
| Accrued Wages and Other Liabilities | 2 61,526 2 6,786 | (3,854) | |
| Accrued Expenses and Other Liabilities | (205,784) 4 0,485 | (125,691) | |
| Cash Provided by Operating Activities | 4 ,403,081 3,867,299 | 2,392,050 |
Source: Item 23 — Receipts (FDD pages 53–163)
What This Means (2025 FDD)
According to Gold Star's 2025 Franchise Disclosure Document, the deposits saw a decrease of $239,834 in the year ended December 31, 2022. This figure is part of the consolidating statement of cash flows, reflecting changes in various assets and liabilities that impact Gold Star's cash position.
Changes in deposits can reflect various factors, such as changes in security deposits for leases, utility deposits, or other prepaid expenses. For a prospective franchisee, this decrease could signal a reduction in required deposits for new locations or services, potentially lowering initial investment costs. However, it's essential to understand the specific reasons behind this change to assess its implications fully.
Franchisees should investigate the nature of these deposits to understand what they represent and why the change occurred. Understanding the reasons behind fluctuations in deposit amounts can provide valuable insights into Gold Star's financial management and operational strategies. It is also important to note that the 2022 figures have been restated, as indicated in the independent auditor's report, suggesting that previous financial statements were corrected for material misstatements.