What was the provision for credit losses for Hardees in Fiscal Year 2025?

According to Hardees's 2025 Franchise Disclosure Document, there are two different values listed for the provision for credit losses in fiscal year 2025. One table lists the provision as $2,868, while another table lists it as $3,246. Both tables also include figures for allowance for credit losses at the beginning and end of the year, recoveries, and charge-offs.

These provisions for credit losses reflect Hardees's estimates of uncollectible amounts from franchisees, primarily related to royalties, franchise fees, and rent. Hardees records these provisions when they believe franchisees are unable to make required payments and will cease accruing revenue from franchisees when collectibility is not reasonably assured.

To mitigate credit risk, Hardees may take actions such as reducing or deferring royalties or rent, invoking personal guarantees, acquiring restaurants, or terminating franchise agreements. The discrepancy in the provision for credit losses between the two tables could be due to different accounting methods, adjustments, or the inclusion of different entities within the consolidated financial statements. A prospective franchisee should seek clarification from Hardees regarding these differing figures to understand the underlying factors influencing these provisions and their potential impact on the financial health of the franchise system.