Does Americas Best Value Inn require franchisees to cooperate with auditors?
Americas_Best_Value_Inn Franchise · 2025 FDDAnswer from 2025 FDD Document
We reserve the right to require that you have these financial statements, and the financial statements of any prior fiscal years, audited by an independent accounting firm designated by us in writing;
(b) within ten days after our request, exact copies of federal and state income tax returns, sales tax returns, and any other forms, records, books, and other information we periodically require relating to your Hotel;
(c) at our request, current financial information for your guarantors sufficient to demonstrate such guarantors' ability to satisfy their financial obligations under their individual guarantees; and
(d) such other information and reports as we request from time to time.
We may disclose data derived from these reports for any reason we deem necessary or appropriate, including making a financial performance representation in our franchise disclosure document. Moreover, we may, as often as we deem appropriate (including daily), access your bookkeeping, accounting, and recordkeeping systems and retrieve all information relating to the operation of your Hotel. You agree to preserve and maintain all records in a secure location at your Hotel for at least seven years (including sales checks, purchase orders, invoices, payroll records, customer lists, check stubs, sales tax records and returns, cash receipts and disbursement journals, and general ledgers), or for any longer period that may be required by law.
Source: Item 23 — RECEIPTS (FDD pages 71–223)
What This Means (2025 FDD)
According to the 2025 Americas Best Value Inn Franchise Disclosure Document, Americas Best Value Inn has the right to request audited financial statements from its franchisees. Specifically, Americas Best Value Inn reserves the right to require franchisees to have their financial statements, including those from prior fiscal years, audited by an independent accounting firm that Americas Best Value Inn designates in writing.
In addition to audited statements, Americas Best Value Inn can request exact copies of federal and state income tax returns, sales tax returns, and any other forms, records, books, and other information related to the franchisee's hotel within ten days of the request. They can also request current financial information from the franchisee's guarantors to ensure they can meet their financial obligations. Furthermore, Americas Best Value Inn can request any other information and reports as they deem necessary from time to time.
Americas Best Value Inn also has the right to access the franchisee's bookkeeping, accounting, and recordkeeping systems as often as they deem appropriate, even daily, to retrieve information related to the hotel's operation. Franchisees must preserve and maintain all records in a secure location at the hotel for at least seven years, including sales checks, purchase orders, invoices, payroll records, customer lists, check stubs, sales tax records and returns, cash receipts and disbursement journals, and general ledgers, or for any longer period required by law. This level of access and the detailed record-keeping requirements are fairly standard in the franchise industry, allowing the franchisor to maintain brand consistency and ensure financial accountability across all locations.