What was the total amount of Ledgers' accounts payable to related parties as of December 31, 2024?
Ledgers Franchise · 2025 FDDAnswer from 2025 FDD Document
| Liabilities and Members' Equity | | Current Liabilities: | | Accounts payable | $ 15,010 | $ 15,010 | $ 125,974 | | Accrued expenses | 4,755 | 9,975 | 5,152 | | Due to related parties | 852,180 | 737,180 | 305,000 | | Deferred revenue - current | 24,000 | 94,000 | 110,000 | | Total Current Liabilities | 895,945 | 856,165 | 546,126 |
Source: Item 22 — CONTRACTS (FDD page 46)
What This Means (2025 FDD)
According to Ledgers' 2025 Franchise Disclosure Document, as of December 31, 2024, the amount due to related parties was $852,180. This figure is listed under current liabilities on the balance sheet. This indicates the amount Ledgers owes to entities or individuals with a special relationship to the company, such as owners, affiliates, or subsidiaries.
For a prospective franchisee, this related-party payable can be an important indicator of Ledgers' financial structure and relationships. It suggests that Ledgers engages in transactions with related parties, which is further explained in Note 2. These transactions are described as short-term advances and cost reimbursements. Understanding the nature of these transactions and the terms under which they occur is crucial for assessing the financial stability and transparency of Ledgers.
It's worth noting that the amount due to related parties has fluctuated over the years presented in the balance sheet. In 2023, it was $737,180, and in 2022, it was $305,000. The increase from 2022 to 2024 could reflect changes in Ledgers' financing activities or its reliance on related parties for short-term funding. A potential franchisee should investigate the reasons for these fluctuations and assess whether they pose any risks to the franchise system.
In addition to the amount due to related parties, the FDD also lists amounts due from related parties under non-current assets. As of December 31, 2024, this amount was $630,180. This indicates that related parties also owe money to Ledgers. Analyzing both the payables and receivables involving related parties provides a more complete picture of these relationships and their potential impact on Ledgers' financial performance.