What specific travel expenses can Aw charge to an Aw franchisee if the franchisee is required to reimburse Aw for an audit?
Aw Franchise · 2025 FDDAnswer from 2025 FDD Document
Further, if the inspection or audit is made necessary by your failure to furnish the reports, supporting records, other information or financial statements required by this Agreement, or to furnish those reports, records, information or financial statements on a timely basis, or discloses an understatement of the Gross Revenue of the Papa Ray's Pizza Restaurant of greater than two percent (2%) for any period, you agree to reimburse us for the cost of such inspection or audit, including, without limitation, the charges of attorneys and any independent accountants, and the travel expenses, room and board and applicable per diem charges for our employees.
Source: Item 22 — CONTRACTS (FDD pages 39–40)
What This Means (2025 FDD)
According to Aw's 2025 Franchise Disclosure Document, if an audit is required due to a franchisee's failure to provide necessary reports or if the audit reveals an understatement of gross revenue exceeding two percent, the franchisee is responsible for reimbursing Aw for the cost of the audit. This reimbursement includes specific travel-related expenses incurred by Aw's employees.
The expenses that Aw can charge the franchisee are travel expenses, room and board, and applicable per diem charges for Aw's employees. This means that in addition to the direct costs of the audit, such as charges from attorneys and independent accountants, the franchisee will also have to cover the costs associated with sending Aw's personnel to conduct the audit.
For a prospective Aw franchisee, this signifies a potential financial burden if they fail to maintain accurate records or submit required reports on time. The cost of an audit, along with the added expenses of travel, lodging, and per diem for Aw's employees, could be substantial. Franchisees should ensure they understand and comply with all reporting requirements to avoid triggering an audit and incurring these additional costs. It is also important to note that these remedies are in addition to any other rights Aw has under the agreement or applicable law, potentially increasing the financial impact of non-compliance.