Is Auntie Annes required to have an independent audit of the Ad Fund completed?

According to Auntie Annes's 2024 Franchise Disclosure Document, Auntie Annes is not required to have an independent audit of its Ad Fund completed. However, Auntie Annes will provide franchisees with an annual summary of the Ad Fund's expenditures upon reasonable request. Any remaining funds in the Ad Fund at the end of the fiscal year will carry over into the next fiscal year.

This means that while franchisees contribute to the Ad Fund, they do not have a guarantee of a third-party audit to verify the fund's management. Instead, Auntie Annes provides an annual summary of expenditures, offering a degree of transparency.

Prospective franchisees should consider the implications of this arrangement, as it places greater reliance on Auntie Annes's internal accounting and reporting practices. While an annual summary is provided, the absence of an independent audit may raise concerns about the thoroughness and impartiality of the financial oversight. It is fairly common for franchise systems to have an audit of the ad fund, so this is something to consider when investing in an Auntie Annes franchise.