How long must a Benihana franchisee retain books of account and records?
Benihana Franchise · 2024 FDDAnswer from 2024 FDD Document
- 8.4 Franchisee must keep full, complete, and accurate books of account and records with respect to Gross Sales and operation of the Restaurant and retain those books and records for at least five (5) years from the dates of their preparation.
- 8.4.1 If an audit, review, or inspection of Franchisee's books and records is in progress, or a controversy should arise between the parties hereto regarding the Royalties or Advertising Contributions paid or due, Franchisee must retain all books and records for any relevant period until such audit, review, inspection, or controversy is concluded or otherwise resolved.
- 8.4.2 All books and records relating to Gross Sales or operation of the Restaurant must be maintained at the Restaurant or, with BNC's prior written consent, at Franchisee's main offices
Source: Item 23 — Receipts (FDD pages 74–576)
What This Means (2024 FDD)
According to Benihana's 2024 Franchise Disclosure Document, a franchisee must maintain full, complete, and accurate books of account and records related to Gross Sales and the operation of the restaurant. These books and records must be retained for at least five years from the date of their preparation.
There is an exception to the five-year rule. If an audit, review, or inspection of the franchisee's books and records is in progress, or if a dispute arises between Benihana and the franchisee regarding royalties or advertising contributions, the franchisee must retain all relevant books and records until the audit, review, inspection, or controversy is concluded or resolved.
All books and records pertaining to Gross Sales or the operation of the Benihana restaurant must be kept at the restaurant location. However, with Benihana's prior written consent, these records may be maintained at the franchisee's main offices. This requirement ensures that financial records are accessible for review and audit purposes, which is a standard practice in franchising to maintain transparency and accountability.