What specific accounting assistance may be provided to a Jack In The Box franchisee?
Jack_In_The_Box Franchise · 2025 FDDAnswer from 2025 FDD Document
e Class A-2 Notes and Variable Funding Notes. As of September 29, 2024 and October 1, 2023, restricted cash balances were $29.4 million and $28.3 million, respectively.
Accounts and other receivables, net — Our accounts and other receivables, net is primarily comprised of receivables from franchisees, tenants, credit card processors, and insurance receivables. Franchisee receivables primarily include rents, property taxes, royalties, marketing, sourcing and technology support fees associated with lease and franchise agreements, and notes from certain of our franchisees. Tenant receivables relate to subleased properties where we are on the master lease agreement. We accrue interest on notes receivable based on the contractual terms.
The Company closely monitors the financial condition of our franchisees and estimates the allowance for credit losses based on the lifetime expected loss on receivables.
Source: Item 21 — FINANCIAL STATEMENTS (FDD pages 93–94)
What This Means (2025 FDD)
Based on the 2025 Franchise Disclosure Document, the financial statements of Jack In The Box Inc. include accounts and other receivables, with a portion specifically related to franchisees. These receivables primarily cover rents, property taxes, royalties, marketing, sourcing, and technology support fees tied to lease and franchise agreements, as well as notes from certain franchisees. This indicates that Jack In The Box monitors and manages the financial obligations of its franchisees as part of its accounting practices.
Jack In The Box closely monitors the financial condition of its franchisees to estimate potential credit losses on receivables. These estimates are informed by historical collection experience, current market conditions, and other relevant events. The company assesses credit quality by tracking payment timings against predefined criteria and by staying informed about the financial health of each franchisee. This proactive approach allows Jack In The Box to maintain a clear understanding of franchisees' financial standing and manage its own financial risks accordingly.
While the FDD mentions the monitoring of franchisee financial conditions and management of receivables, it does not explicitly detail specific accounting assistance that Jack In The Box provides to its franchisees. A prospective franchisee should seek clarification from Jack In The Box regarding the availability of accounting support, training, or resources to ensure they fully understand their financial obligations and can effectively manage their business finances.