What was the total deferred tax liabilities for My Salon Suite in 2023?
My_Salon_Suite Franchise · 2025 FDDAnswer from 2025 FDD Document
assets and liabilities consist of the following as of December 31:
| 2024 | 2023 | |
|---|---|---|
| Deferred tax assets | ||
| Allowance for credit losses | $ 213,104 | $ 259,270 |
| Accrued compensation | 216,180 | 105,770 |
| Share-based compensation | 585,048 | 653,599 |
| Accrued professional fees | 51,940 | 34,418 |
| Deferred revenue | 1,613,108 | 860,544 |
| ASC 842 lease liability | 140,303 | 3,309 |
| ASC 606 adjustments | (224,956) | (224,956 ) |
| Total deferred tax assets | 2,594,727 | 1,691,954 |
| Deferred tax liabilities: | ||
| Intangible assets | (18,813,230) | (18,689,307 ) |
| Prepaid expenses | (4,117) | 9,702 |
| ASC 842 Right of Use Asset | (142,804) | (4,487 ) |
| Depreciation | (31,197) | (90,514 ) |
| Tax amortization of Sec.174 | (7,430) | (137,714 ) |
| Total deferred tax liabilities | (18,998,778) | (18,912,320 ) |
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 total deferred tax liabilities for 2023 were $(18,912,320). This figure represents the cumulative amount of taxes that My Salon Suite has deferred to future periods based on temporary differences between the financial reporting and tax bases of assets and liabilities. These liabilities primarily stem from intangible assets, prepaid expenses, ASC 842 Right of Use Asset, depreciation, and tax amortization of Sec.174.
Deferred tax liabilities generally arise when taxable income is lower than accounting income, meaning My Salon Suite has postponed paying some taxes. For a prospective franchisee, this indicates the company's approach to tax planning and management. It is important to note that deferred tax liabilities are not immediately payable but are expected to be settled in future years when the temporary differences reverse.
Understanding the nature and magnitude of these deferred tax liabilities can provide insights into My Salon Suite's financial strategy and potential future tax obligations. Franchisees may want to discuss these figures with a financial advisor to fully understand their implications for the long-term financial health of the company. Reviewing these liabilities in the context of My Salon Suite's overall financial statements can offer a more comprehensive view of the company's financial position.