As of December 31, 2022, what were the accounts receivable (net) for My Salon Suite?
My_Salon_Suite Franchise · 2025 FDDAnswer from 2025 FDD Document
identified during the audit.
Dallas, Texas April 26, 2024
Consolidated Balance Sheets
| As of December 31, | 2023 | 2022 |
|---|---|---|
| Assets | ||
| Current assets | ||
| Cash and cash equivalents | $ 8,047,052 | $ 11,866,419 |
| Accounts receivable - net | 5,374,191 | 5,062,196 |
| Current portion of notes receivable - net | 66,427 | 91,504 |
| Amounts due from affiliates | 486,028 | - |
| Prepaid expenses | 1,956,054 | 2,561,724 |
| Other current assets | 736,544 | 640,893 |
| T | 44.444.204 | 20 222 727 |
| Total current assets | 16,666,296 | 20,222,736 |
| Fixed assets - net | 12,961,306 | 9,996,833 |
| Right of use assets - net | 60,777,646 | 44,760,873 |
| Other intangibles - net | 81,990,839 | 83,841,171 |
| Goodwill - net | 300,287,335 | 296,897,247 |
| Notes receivable, less current portion - net | 90,091 | 111,093 |
| Other |
Source: Item 6 — Other Intangibles and Goodwill (FDD pages 274–314)
What This Means (2025 FDD)
According to My Salon Suite's 2025 Franchise Disclosure Document, the accounts receivable (net) as of December 31, 2022, was $5,062,196. This figure represents the amount of money owed to My Salon Suite by its customers, primarily franchisees, after accounting for potential credit losses. These receivables are typically due within 30 days, as stated in the FDD.
For a prospective franchisee, understanding the accounts receivable is crucial because it reflects the financial health and stability of My Salon Suite. A healthy accounts receivable balance indicates that franchisees are generally paying their dues in a timely manner. However, it's also important to consider the allowance for credit losses, which suggests that My Salon Suite anticipates some franchisees may not be able to fulfill their payment obligations.
My Salon Suite estimates the allowance for credit losses based on factors such as historical collectability, the aging of receivables, and the financial performance of its franchisees. This allowance reduces the stated value of accounts receivable to reflect a more realistic expectation of what the company will actually collect. Monitoring these figures can provide insights into the overall financial risk associated with the franchise system. Franchisees should inquire about the criteria and historical trends related to these credit losses to better assess the financial dynamics of the My Salon Suite franchise network.