RELATED PARTY TRANSACTIONS |
6 Months Ended |
|---|---|
Jun. 30, 2024 | |
| Related Party Transactions [Abstract] | |
| RELATED PARTY TRANSACTIONS |
12. RELATED PARTY TRANSACTIONS
Accounts Receivable – Related Parties
The Company had accounts receivable – related parties of $4,473 and $0 as of June 30, 2024 and December 31, 2023, respectively, net of allowances for expected credit losses of $1,506,651 and $1,517,836, respectively, representing the net realizable value of advances made to, and expense sharing obligations receivable from, separate entities under common management.
GAUCHO GROUP HOLDINGS, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited)
The Company recorded recoveries of credit losses (net of credit loss expense) related to accounts receivable, related parties of $139,346 and $11,185 and during the three and six months ended June 30, 2024, respectively. The Company recorded credit losses related to accounts receivable, related parties of $0 and $19,431 during the three and six months ended June 30,2023, respectively. Credit losses are recorded as bad debt expense which is reflected within general and administrative expenses on the accompanying condensed consolidated statements of operations.
Expense Sharing
On April 1, 2010, the Company entered into an agreement with a Related Party to share expenses such as office space, support staff, professional services, and other operating expenses (the “Related Party ESA”). During the three months ended June 30, 2024 and 2023, the Company made advances in the amount of $67,000 and $0, respectively, to the related entities, and paid expenses on behalf of the related entities (pursuant to the expense sharing agreements discussed below) in the amount of $77,829 and $208,103, respectively. The Company received repayments from the related parties in the amount of $284,175 and $237,813 during the three months ended June 30, 2024 and 2023, respectively.
During the six months ended June 30, 2024 and 2023, the Company made advances in the amount of $172,540 and $85,644, respectively, to the related entities, and paid expenses on behalf of the related entities (pursuant to the expense sharing agreements discussed below) in the amount of $185,001 and $383,529, respectively. The Company received repayments from the related parties in the amount of $369,168 and $367,813 during the six months ended June 30, 2024 and 2023, respectively.
Management Fee Income
During the six months ended June 30, 2024 and 2023, the Company recorded income of $0 and $150,000 respectively, representing management fees received from LVH pursuant to a June 2021 agreement with LVH.
Other Related Party Transactions
See Note 9 – Loans Payable related to promissory notes issued, and Note 10 – Convertible Debt related to Preferred Share Convertible Notes issued to a holder greater than 10% of the Company’s common stock.
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