What was the net value of accounts receivable for Sonesta Simply Suites as of December 31, 2023?
Sonesta_Simply_Suites Franchise · 2025 FDDAnswer from 2025 FDD Document
racts with Customers
The following table provides information about receivables, contract assets and contract liabilities from contracts with customers (in thousands):
| December 31, |
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Source: Item 21 — FINANCIAL STATEMENTS (FDD page 79)
What This Means (2025 FDD)
According to Sonesta Simply Suites's 2025 Franchise Disclosure Document, the net accounts receivable as of December 31, 2023, was $7,259. This figure represents the amount of money owed to Red Lion Hotels Corporation (RLHC) after deducting any allowances for doubtful accounts, which are accounts that may not be collectible. This is a standard accounting practice to provide a more realistic view of the company's financial position.
For a prospective Sonesta Simply Suites franchisee, understanding the accounts receivable is crucial because it reflects the efficiency of the company in collecting revenues. A higher accounts receivable balance might indicate that the company is having trouble collecting payments, which could affect its cash flow. Conversely, a lower balance suggests efficient revenue collection.
It's also important to note that these figures are part of the overall financial statements of RLHC, the parent company of Sonesta Simply Suites. Therefore, the financial health of RLHC directly impacts the stability and resources available to the Sonesta Simply Suites franchise system. Franchisees should review these figures in the context of the entire financial statement to assess the financial strength and operational efficiency of the franchisor.