PRIMARY SOURCEBAM Franchising’s own audited financial statements
Today is one of the biggest days on the LEGO calendar. Ninety-seven new sets arrived at once, from eighteen Pokémon sets to a new Tower Bridge to LEGO Ideas’ X-Files. If LEGO is your hobby, today is a spending day. So it is a fair day to look at any Bricks & Minifigs gift card or store credit sitting in a drawer, and at what the company’s own audited filings say is standing behind it. Every company figure below is taken from BAM Franchising’s audited financial statements, filed inside its own Franchise Disclosure Document. Read together, they say something the company never says out loud: the money that keeps BAM standing is money it owes to other people.
Why this belongs on this site. This site has already read BAM’s disclosure document against itself and walked its prices set by set on the store. Those posts used the revenue and margin tables BAM files. This one uses the rest of the same filing: the balance sheet, the cash-flow statement, and the statement of stockholders’ equity. Nothing here is a leak or an estimate. It is the audited document BAM hands every prospective franchisee, read this time for what it says about the gift card in a customer’s pocket.
On its own audited books, for the year ended December 31, 2025, BAM Franchising reported a net loss of $66,914. The year before, the loss was $215,635. At the same date, its total stockholders’ equity was negative $621,091, meaning the company records that it owes more than everything it owns. Even so, its independent auditors signed an unqualified opinion, the cleanest kind, on those statements. So on paper the company keeps running. The whole question is on what.
“Float” is money a business takes in today for something it has not delivered yet. A gift card is the purest form of it: the customer pays now, the company owes merchandise later, and until the card is redeemed the company holds the customer’s cash. BAM’s audited cash-flow statement shows $361,911 of cash from operations in 2025, a respectable figure for a company that lost money on the year. Here is what is inside it. The growth in gift-card balances added $343,787. The growth in other prepaid money, franchise and subscription fees paid in advance, added $311,665. Take out the gift-card line alone, and cash from operations falls to $18,124. Take out both prepayment lines, and it is negative $293,541. The healthy-looking number is the float. Strip the growth in money that customers and franchisees paid ahead, and the operation itself ran cash-negative.
A float only feeds cash while it is getting bigger. Across four straight years of BAM’s own audited balance sheets, the amount it owes on gift cards has done nothing but climb, while its net worth has done nothing but fall.
| Year end | Gift cards owed | Company net worth |
|---|---|---|
| 2022 | $146,338 | −$181,935 |
| 2023 | $417,367 | −$276,860 |
| 2024 | $673,228 | −$492,495 |
| 2025 | $1,017,015 | −$621,091 |
The gift-card line has roughly septupled. By the end of 2025 the amount owed on gift cards alone, just over one million dollars, is larger than the company’s entire negative-net-worth hole.
Everything above is on file. This part is arithmetic. A float adds cash while it grows, adds nothing while it is flat, and takes cash away when it shrinks, which is what happens when customers redeem gift cards faster than the company sells new ones. Run the 2025 numbers three ways, changing only the gift-card line and leaving everything else exactly as reported. Growing, as it actually did, cash from operations is $361,911. Flat, with no net new card sales, it is $18,124. Shrinking by the amount it grew, it is roughly negative $325,000. Nothing else on the statement moves. The distance between a company that looks fine and a company burning a quarter of a million dollars a year is entirely which way one line points. A company with negative net worth and no cash flow underneath the float has no reserve to absorb the swing. It has already spent the money that would have cushioned it.
The float is not the only soft spot. In 2025 the money owed to BAM grew by $611,099, revenue the company booked but had not collected. Its own balance sheet shows much of what it is owed sits inside its own network, in unpaid royalties and in cash advanced out to individual stores. So the reported top line leans more and more on IOUs from the same franchise stores the company depends on. An IOU from a store that is itself struggling is the first number that stops being worth its face.
In the same year it reported a loss and negative net worth, BAM spent $61,682 buying back its own stock, and did it with a promissory note rather than cash. A buyback is how a company hands value to a departing owner. Doing it while the company already owes more than it owns, and borrowing to do it, moves money out of a business that is short and pushes the shortfall onto everyone still owed. Customers holding gift cards stand in that same line.
A gift card is not a coupon. It is a debt the company owes the person holding it, and that debt does not vanish when the money does. A business can open a dedicated account for gift-card cash, spend it to nothing, and still owe every cardholder every dollar; the obligation outlives the balance. What changes is what kind of creditor a cardholder becomes. Federal law, the Credit CARD Act, governs how long a card stays valid and what fees may be charged. It puts no money behind the card if the company fails. Unless a state requires gift-card dollars to be held in trust, that cash is an ordinary company asset, spent like any other. If the company goes under, gift-card holders stand near the back of the line: a small capped priority for the first few thousand dollars a person, and an ordinary unsecured claim for the rest, the kind that recovers pennies, if anything. Which is only the plain reading of the numbers above. A gift-card balance is worth full face value while the company is open and honoring cards. That is the one condition under which it is worth full face value.
One last fact from the filings. BAM Franchising holds the gift-card money centrally, in its own accounts, and requires every store to run the gift-card program through the processor it designates. The dollars on an outstanding card were collected once, up front, and the company has held them since. So for someone who already holds a card, there is a difference worth understanding. Spending a card already in hand draws down money the company took long ago. Handing over new cash for the same merchandise sends the company a fresh cut on top. One uses value already paid; the other adds to it. What any one person does with a card they are owed is their own call, and their own money.
The fair counterpoint. Nothing here is a prediction that BAM Franchising will fail, and this site does not make one. The company’s auditors issued an unqualified opinion and attached no going-concern warning, which is their formal judgment that they saw no substantial doubt about the company continuing. Negative book equity is an accounting measure, not a finding of insolvency: a company can carry negative equity for years and keep paying its bills, and book value is not market value. Deferred revenue and gift-card balances are ordinary liabilities that every retailer and franchisor carries, and their growth can reflect a growing business as easily as a fragile one, since a rising gift-card balance also means cards are being sold. The three-way calculation above is arithmetic on the reported figures, not a forecast of redemptions, which no one can predict. Extending credit to franchisees and repurchasing shares are lawful, common corporate acts with ordinary explanations, and the buyback was disclosed in the same filing quoted here, which is the opposite of hidden. The consumer-law description above is general: gift-card protections and creditor priorities vary by state and by the facts of any particular failure, and nothing here is legal or financial advice. This site is not neutral about BAM, and it says so plainly; every number above is BAM’s own, filed under audit, so a reader can check each one. Nothing here is a finding of law, and everyone named is presumed to have acted lawfully.
Sources. All company figures are from the audited consolidated financial statements of BAM Franchising, Inc. and Subsidiaries, contained in the exhibits to its 2026 Franchise Disclosure Document and audited by Gilbert & Stewart, CPA, of Provo, Utah (report dated March 26, 2026). The balance sheet reports gift-card payable of $1,017,015 at December 31, 2025, and $673,228, $417,367, and $146,338 at the three prior year ends, and total stockholders’ equity of negative $621,091, and of negative $492,495, $276,860, and $181,935 before it. The statement of cash flows reports net cash provided by operating activities of $361,911, an increase in gift-card payable of $343,787, an increase in deferred revenue of $311,665, and a $611,099 increase in accounts receivable. The statement of stockholders’ equity reports a $61,682 repurchase of treasury stock, funded by a note payable per the supplemental cash-flow disclosure. The auditors’ report expresses an unqualified opinion. The ex-float figures of $18,124 and negative $293,541, and the reversal figure of about negative $325,000, are arithmetic on those reported lines. That each store must use the gift-card processor BAM designates is stated in Item 8 of the same document. On consumer protection: the federal Credit CARD Act, 15 U.S.C. 1693l-1, governs gift-card expiration and fees; the priority of consumer deposit claims in bankruptcy is set by 11 U.S.C. 507(a)(7), capped per person with the balance treated as a general unsecured claim; whether gift-card funds must be held in trust is a matter of state law. The August 1, 2026 LEGO release of about 97 sets is reported by Brick Fanatics, 9to5Toys, and Jay’s Brick Blog. This site’s earlier reading of BAM’s own filings appears on the store and the disclosure.
The BAM Map is independent reporting on matters of public concern. Nothing here is a finding of any person’s guilt; the criminal charges referenced are unadjudicated and every defendant is presumed innocent. Sources are linked so readers can check the record. · Home · Map · The law · Bodycam