Accounting Question
- Thread starter vanzandt
- Start date
Some of the largest companies in the world do things like put chunks of CEO bonuses in stationary accounts to hide them. It's called creative accounting, any company these days not doing it will be bankrupt. That's why I generally stay away from all but the most liquid stocks, I know what happens behind the scenes.
Robert Morse
Sponsor
What company? I can think of ways they can generate ad revenues from other companies in their restaurant or on their Web pages. An example might beer, wine and liquor. They can promote a brand.
Thanks guys.... I figured it out.
Its an advertising fund that franchisee's pay into and then it appears it is written off later under SG&A.
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Advertising Fund
The Company administers the Wingstop Restaurants Advertising Fund (“Ad Fund”), which is used for various forms of advertising for the Wingstop brand. Advertising fund contributions and expenditures are reported on a gross basis in the Consolidated Statements of Operations, which are largely offsetting and therefore do not significantly impact our reported net income. Advertising expenses incurred by company-owned restaurants are included within cost of sales in the Consolidated Statements of Operations. Administrative expenses of the Ad Fund, such as administrative support services and compensation expenses of employees that provide services directly to the Ad Fund, are included in selling, general and administrative expenses (“SG&A”) in the Consolidated Statements of Operations.
The advertising fund contribution collected from Wingstop restaurant franchisees and company-owned and operated restaurants is equal to 3% of gross sales. For the thirteen weeks ended March 31, 2018 and April 1, 2017 the Company contributed $1.0 million and $2.9 million, respectively, for the purpose of supplementing the national advertising campaign, which were included in advertising expenses in the Consolidated Statements of Operations.
Its an advertising fund that franchisee's pay into and then it appears it is written off later under SG&A.
______________
Advertising Fund
The Company administers the Wingstop Restaurants Advertising Fund (“Ad Fund”), which is used for various forms of advertising for the Wingstop brand. Advertising fund contributions and expenditures are reported on a gross basis in the Consolidated Statements of Operations, which are largely offsetting and therefore do not significantly impact our reported net income. Advertising expenses incurred by company-owned restaurants are included within cost of sales in the Consolidated Statements of Operations. Administrative expenses of the Ad Fund, such as administrative support services and compensation expenses of employees that provide services directly to the Ad Fund, are included in selling, general and administrative expenses (“SG&A”) in the Consolidated Statements of Operations.
The advertising fund contribution collected from Wingstop restaurant franchisees and company-owned and operated restaurants is equal to 3% of gross sales. For the thirteen weeks ended March 31, 2018 and April 1, 2017 the Company contributed $1.0 million and $2.9 million, respectively, for the purpose of supplementing the national advertising campaign, which were included in advertising expenses in the Consolidated Statements of Operations.
Thats exactly why I like to go CSI on these high PE "growth story's" in the brick and mortar space. Especially restaurants. Find cracks in the armor and sock them away for later shorting opportunities.
WING is OK for now. The story remains in tact. Same store sales up 12.5%. Labor and food up only slightly. If CMG could do that.... it would be $1000/share
.Creative accounting at it's finest, albeit on a micro scale, I'm not looking in to the details but if that inflates revenue then they will be hiding expenses somewhere, Newton at work again.
"do not significantly impact our reported net income" the question is, what is their definition of 'significant', so perfectly worded most would miss it.
You don't consider your own unissued shares a "marketable security" if that's what you're asking. The balance sheet wouldn't balance, for one, and it just wouldn't make sense for a variety of reasons. It's generally shares held in other companies, for example Yahoo's share of Alibaba would be shown that way (although that case is a bit more complicated).