What was the amount of deferred revenue for Surestay Hotel By Best Western in 2024?
Surestay_Hotel_By_Best_Western Franchise · 2025 FDDAnswer from 2025 FDD Document
revenues in the Consolidated Statements of Revenues and Expenses.
Contract balances
The Company records a receivable as performance obligations are satisfied and there is an unconditional right to receive payment. Deferred revenue is recorded when the Company receives payment, or has the unconditional right to receive payment, in advance of the satisfaction of the Company's performance obligations related to initial affiliation fees and the BWR program.
Certain costs to obtain contracts with Members, soft brand licensees, SureStay franchisees, and WorldHotels licensees are capitalized and amortized on a straight-line basis over the hotelier's expected life as a branded hotel or over the initial contract term. The costs of obtaining a contract with a Member, soft brand licensee, SureStay franchisee, and WorldHotels licensee are recorded in prepaid expenses and other current assets, and other assets, net in our Consolidated Statements of Financial Position.The related amortization is recorded in compensation, taxes and benefits in our Consolidated Statements of Revenues and Expenses. The Company had capitalized costs to obtain contracts with customers of $12.9 million a
Source: Item 23 — Receipts (FDD pages 88–286)
What This Means (2025 FDD)
Based on the 2025 Franchise Disclosure Document, Item 23 discusses revenue recognition for Best Western International, Inc., which includes SureStay, Inc. as a wholly-owned subsidiary and franchisor. The document explains that deferred revenue is recorded when payment is received, or there is an unconditional right to receive payment, before the company satisfies its performance obligations related to initial affiliation fees and the BWR program.
However, the excerpt does not provide a specific deferred revenue amount for SureStay Hotel By Best Western or Best Western International for 2024. Instead, it generally describes the conditions under which the company records deferred revenue. It mentions that costs to obtain contracts with members, soft brand licensees, SureStay franchisees, and WorldHotels licensees are capitalized and amortized. The capitalized costs to obtain contracts with customers were $12.9 million at November 30, 2023, and $13.3 million at November 30, 2022.
To determine the exact amount of deferred revenue for SureStay Hotel By Best Western in 2024, a prospective franchisee should review the complete financial statements in the FDD or ask the franchisor directly for this information. Understanding deferred revenue can help a franchisee assess the financial stability and revenue recognition practices of the franchisor.