What are my obligations regarding cooperation with Best In Class Education Center during an audit?
Best_In_Class_Education_Center Franchise · 2025 FDDAnswer from 2025 FDD Document
17.2. Audit. We may audit your books and records at any time. You must fully cooperate with us and any Person we hire to conduct the audit. If an audit reveals an understatement of Gross Sales, Special Program Sales or Affiliate Program Sales, you must immediately pay us all additional fees you owe together with any late fee imposed pursuant to §14.5. You must reimburse us for the cost of any audit (including reasonable accounting and attorneys' fees and Travel Expenses incurred by us or the auditor) that: (a) is required due to your failure to provide information we request, preserve records or file reports as required by this Agreement; or (b) reveals an understatement of Gross Sales, Special Program Sales or Affiliate Program Sales by at least 3%. We bear the cost of all other audits. Your reimbursement of our audit costs does not preclude us from terminating this Agreement
Source: Item 23 — RECEIPT (FDD pages 47–204)
What This Means (2025 FDD)
According to Best In Class Education Center's 2025 Franchise Disclosure Document, as a franchisee, you must fully cooperate with Best In Class Education Center and any person they hire to conduct an audit of your books and records. This cooperation is required at any time Best In Class Education Center chooses to perform an audit.
If an audit reveals an understatement of Gross Sales, Special Program Sales, or Affiliate Program Sales, you are obligated to immediately pay all additional fees owed, along with any late fees. Furthermore, you must reimburse Best In Class Education Center for the cost of the audit if it was required due to your failure to provide requested information, preserve records, or file reports as required by the Franchise Agreement. Reimbursement is also required if the audit reveals an understatement of Gross Sales, Special Program Sales, or Affiliate Program Sales by at least 3%. These costs can include reasonable accounting and attorneys' fees, as well as travel expenses incurred by Best In Class Education Center or the auditor.
However, Best In Class Education Center bears the cost of all other audits that do not meet the conditions requiring franchisee reimbursement. It is important to note that your reimbursement of Best In Class Education Center's audit costs does not prevent them from terminating the Franchise Agreement. Therefore, franchisees must maintain accurate records and fully cooperate during audits to avoid financial penalties and potential termination of the agreement.