What was the approximate allowance for doubtful accounts on accounts receivable generated by Management Recruiters company-owned offices at December 31, 2021?
Management_Recruiters Franchise · 2024 FDDAnswer from 2024 FDD Document
ble age beyond the agreed-upon date, they are charged back to our franchisees. Accordingly, we do not record an allowance for doubtful accounts on these accounts receivable.
For staffing services provided by company-owned offices, we record accounts receivable at face value less an allowance for doubtful accounts. We determine the allowance for doubtful accounts based on historical write-off experience, the age of the receivable, other qualitative factors and extenuating circumstances, and current economic data which represents our best estimate of the amount of probable losses on these accounts receivable, if any. We review the allowance for doubtful accounts periodically and write off past due balances when it is probable that the receivable will not be collected. Our allowance for doubtfu
Source: Item 21 — FINANCIAL STATEMENTS (FDD pages 65–66)
What This Means (2024 FDD)
According to Management Recruiters' 2024 Franchise Disclosure Document, the company records accounts receivable at face value less an allowance for doubtful accounts for staffing services provided by company-owned offices. The allowance is determined based on historical write-off experience, the age of the receivable, other qualitative factors, extenuating circumstances, and current economic data. This allowance represents Management Recruiters' best estimate of probable losses on these accounts receivable.
Management Recruiters reviews the allowance for doubtful accounts periodically and writes off past due balances when it is probable that the receivable will not be collected. At December 31, 2021, the allowance for doubtful accounts on accounts receivable generated by Management Recruiters' company-owned offices was approximately $26,000.
This information is relevant for prospective franchisees as it provides insight into how Management Recruiters manages its accounts receivable and estimates potential losses. Understanding the company's approach to doubtful accounts can help franchisees assess the financial stability and risk management practices of the franchisor.