What was the amount of charge-offs related to credit losses for Hardees in fiscal year 2024?
Hardees Franchise · 2025 FDDAnswer from 2025 FDD Document
ive tax rate reconciliation. The standard also requires annual disclosure of income taxes paid disaggregated by federal, state and foreign taxes. The standard is effective for annual reporting periods beginning after December 15, 2024 for public entities. For other entities, the standard is effective for annual reporting periods beginning after December 15, 2025. Early a
Source: Item 21 — Financial Statements (FDD pages 84–85)
What This Means (2025 FDD)
According to Hardees' 2025 Franchise Disclosure Document, the charge-offs related to credit losses for fiscal year 2024 were $897. This figure represents the amount of uncollectible receivables that Hardees has written off as a loss during that fiscal year. These charge-offs are related to amounts due from franchisees for royalties, franchise fees, and rent.
Credit losses can occur when franchisees face financial difficulties and are unable to meet their payment obligations to Hardees. The FDD notes that Hardees records provisions for estimated credit losses on receivables when they believe franchisees cannot make required payments and will cease accruing royalties and rent revenue from franchisees when collectibility is not reasonably assured.
For a prospective Hardees franchisee, this information highlights the importance of the financial health of existing franchisees and the potential risk of credit losses. It also indicates that Hardees has a system in place to manage and account for these potential losses. Understanding the factors that contribute to franchisee financial stability and the measures Hardees takes to mitigate credit risk can be valuable for new franchisees.