What financial threshold triggers an audit by All Dogs Unleashed, and what are the consequences?
All_Dogs_Unleashed Franchise · 2025 FDDAnswer from 2025 FDD Document
| Type of Fee1 | Amount | Due Date | Remarks |
|---|---|---|---|
| Audit | Cost of audit plus interest on the underpayment at the Default Rate | Upon demand | If an audit discloses an understatement of Gross Sales of 2% more, you must pay us fees due on the underreported amount plus interest and reimburse us audit-related costs. |
| Interest on Late Payment | Lesser of: the rate of 18% per annum, or highest commercial contract interest rate law allowed in Facility's jurisdiction ("Default Rate") | Upon demand | Payable only for overdue amounts. |
Source: Item 6 — OTHER FEES (FDD pages 9–12)
What This Means (2025 FDD)
According to All Dogs Unleashed's 2025 Franchise Disclosure Document, an audit will be triggered if there is an understatement of Gross Sales of 2% or more.
If the audit reveals such an understatement, the franchisee is responsible for covering several costs. First, they must pay All Dogs Unleashed the fees due on the underreported amount. Second, they will be charged interest on the underpayment. The interest rate will be the lesser of 18% per annum or the highest commercial contract interest rate allowed in the facility's jurisdiction, referred to as the "Default Rate." Finally, the franchisee must reimburse All Dogs Unleashed for all costs associated with conducting the audit.
This policy incentivizes accurate reporting of gross sales by franchisees. Underreporting, even if unintentional, can lead to significant financial penalties, including back payments, interest, and audit expenses. Franchisees should maintain meticulous records and accounting practices to ensure compliance and avoid triggering an audit by All Dogs Unleashed.