Can Benjamin Franklin Plumbing designate the accounting program that franchisees are required to use?
Benjamin_Franklin_Plumbing Franchise · 2025 FDDAnswer from 2025 FDD Document
8.1. Business Records and Reports. You are required to prepare, and to preserve for at least five (5) years from the dates of their preparation, complete and accurate books, records, and accounts, in accordance with generally accepted accounting principles and in the form and manner we prescribe. We may designate the chart of accounts and/or the accounting program or platform that you are required to use. You are required to provide to us upon request, or provide us with access to, all books, records, tax returns, accounting records, and supporting documents relating to the Franchised Business, including but not limited to daily cash reports, cash receipts journals, general ledgers, cash disbursement journals, weekly payroll registers, monthly bank statements, daily deposit slips, canceled checks, credit card statements, business tax returns, personal tax returns for all Owners and guarantors, supplier invoices, balance sheets, income statements, records of promotions and coupon redemptions, and lists of customers (both current and past) serviced by the Franchised Business.
Concurrently with each payment of the Royalty Fee, you are required to send us, or provide us with access to, a report of Gross Revenue for the preceding period, and at our request, you are required to send us, or provide us with access to, accounting records, inventory reports, and such other information and supporting records as we may specify.
Source: Item 23 — RECEIPTS (FDD pages 88–312)
What This Means (2025 FDD)
According to Benjamin Franklin Plumbing's 2025 Franchise Disclosure Document, franchisees are required to maintain complete and accurate books, records, and accounts following generally accepted accounting principles. These records must be kept for at least five years from the date of preparation. Benjamin Franklin Plumbing has the authority to designate the specific chart of accounts and/or the accounting program or platform that franchisees must use.
This means that as a Benjamin Franklin Plumbing franchisee, you may be obligated to use a specific accounting software or system chosen by the franchisor. This requirement ensures that all franchisees use a standardized accounting method, making it easier for the franchisor to collect and analyze financial data across the entire franchise system.
Furthermore, Benjamin Franklin Plumbing requires franchisees to provide access to all books, records, tax returns, accounting records, and supporting documents related to the franchised business upon request. This includes a wide range of financial documents, such as daily cash reports, general ledgers, bank statements, tax returns, and customer lists. Franchisees must also submit a report of Gross Revenue concurrently with each royalty fee payment and provide any other accounting or inventory information requested by Benjamin Franklin Plumbing.
This level of oversight allows Benjamin Franklin Plumbing to monitor the financial performance of individual franchises and the overall health of the brand. While this provides the benefit of a consistent accounting system, franchisees should consider the potential costs of adopting a mandated accounting program, including software expenses, training, and any ongoing maintenance fees.