What was the net value of notes receivable for Management Recruiters as of December 31, 2021?
Management_Recruiters Franchise · 2024 FDDAnswer from 2024 FDD Document
We have served as the Company's auditor since 2017.
/s/ Plante & Moran, PLLC
Denver, Colorado March 21, 2023
HireQuest, Inc. Consolidated Balance Sheets
| (in thousands except par value data) | December 31, 2022 | December 31, 2021 | |
|---|---|---|---|
| ASSETS | |||
| Current assets | |||
| Cash | $ | 3,049 | $ 1,256 |
| Accounts receivable, net of allowance for doubtful accounts | 45,728 | 38,239 | |
| Notes receivable | 817 | 1,481 | |
| Prepaid expenses, deposits, and other assets | 1,833 | 659 | |
| Prepaid workers' compensation | 503 | 369 | |
| Total current assets | 51,930 | 42,004 | |
| Property and equipment, net | 4,353 | 4,454 | |
| Workers' compensation claim payment deposit | 1,231 | 948 | |
| Franchise agreements, net | 23,144 | 18,848 | |
| Other intangible assets, net | 10,690 | 6,228 | |
| Goodwill | 5,870 | - | |
| Other assets | 325 | 334 | |
| Notes receivable, net of current portion and reserve | 2,675 | 2,686 | |
| Intangible assets held for sale - discontinued operations | 3,065 | 1,850 | |
| Total assets | $ | 103,283 | $ 77,352 |
| LIABILITIES AND STOCKHOLDERS' EQUITY | |||
| Current liabilities | |||
| Accounts payable | $ | 448 | $ 1,126 |
| Line of credit | 12,543 | 171 | |
| Term loans payable | 704 | 210 | |
| Other current liabilities | 3,408 | 2,658 | |
| Accrued wages, benefits and payroll taxes | 5 |
Source: Item 21 — FINANCIAL STATEMENTS (FDD pages 65–66)
What This Means (2024 FDD)
According to Management Recruiters' 2024 Franchise Disclosure Document, the net value of notes receivable as of December 31, 2021, was $1,481,000. This figure represents the total amount of notes receivable Management Recruiters held at that time, net of any allowances for doubtful accounts. Notes receivable are amounts owed to Management Recruiters, typically from franchisees or other parties, and the 'net' value reflects the amount Management Recruiters realistically expects to collect.
In addition to the general notes receivable, Management Recruiters also had notes receivable, net of current portion and reserve, totaling $2,686,000 as of December 31, 2021. This category likely represents longer-term notes receivable, with the 'current portion' referring to the amount expected to be collected within the next year, and the 'reserve' accounting for potential losses.
These figures are important for prospective franchisees to understand because they provide insight into Management Recruiters' financial health and its dealings with franchisees and other entities. A significant amount of notes receivable could indicate that Management Recruiters is actively involved in financing franchisees or has a history of selling assets on credit. Monitoring these figures over time can reveal trends in Management Recruiters' financial strategies and risk management practices.