Under what conditions will an Aira Fitness franchisee reimburse Aira Fitness for the cost of an inspection or audit?
Aira_Fitness Franchise · 2025 FDDAnswer from 2025 FDD Document
Further, if the audit is made necessary by your failure to furnish reports, financial statements, tax returns or schedules as herein required, or if an understatement of Gross Sales for any period is determined by any such inspection or audit to be greater than two percent (2%), you shall reimburse usfor the cost of such inspection or audit including, without limitation, the charges of attorneys and independent accountants and the travel expenses, room and board, and compensation of our employees or agents, and we shall have the right to require you to furnish, at your sole cost and expense, financial statements prepared by an independent certified public accountant thereafter.
In addition, you shall pay for all costs, as specified above, of the inspection and audit if your books and records are not produced at the time of the inspection and audit, provided that we notified you at least five (5) days prior to the scheduled inspection and audit date.
Source: Item 23 — **RECEIPTS (FDD pages 59–254)
What This Means (2025 FDD)
According to Aira Fitness's 2025 Franchise Disclosure Document, a franchisee may be required to reimburse Aira Fitness for the cost of an inspection or audit under specific circumstances. If an audit reveals an understatement of Gross Sales, the franchisee is responsible for paying the Royalties, National Marketing Fees, and other fees, along with interest and late fees, on the understated amount.
Furthermore, Aira Fitness will require the franchisee to cover the costs of the inspection or audit if the audit was necessitated by the franchisee's failure to provide required reports, financial statements, tax returns, or schedules. This reimbursement also applies if the inspection or audit determines that the understatement of Gross Sales exceeds two percent (2%). The costs that the franchisee would be responsible for include charges for attorneys and independent accountants, as well as travel expenses, room and board, and compensation for Aira Fitness's employees or agents.
Additionally, the franchisee is responsible for covering all costs associated with the inspection and audit if the franchisee fails to produce their books and records at the time of the inspection and audit, provided that Aira Fitness has given the franchisee at least five (5) days' notice prior to the scheduled inspection and audit date. This condition emphasizes the importance of maintaining accurate records and ensuring their availability for inspection to avoid incurring additional expenses.