Under what circumstances must I reimburse Best In Class Education Center for the cost of an audit?
Best_In_Class_Education_Center Franchise · 2025 FDDAnswer from 2025 FDD Document
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, a franchisee may be required to reimburse the franchisor for the cost of an audit under specific circumstances. These costs can include reasonable accounting and attorneys' fees, as well as travel expenses incurred by Best In Class Education Center or the auditor.
The franchisee is responsible for reimbursing Best In Class Education Center for audit costs if the audit was necessary due to the franchisee's failure to provide requested information, preserve records, or file required reports as outlined in the Franchise Agreement. Additionally, if an audit reveals an understatement of Gross Sales, Special Program Sales, or Affiliate Program Sales by at least 3%, the franchisee must cover the audit expenses.
However, Best In Class Education Center bears the cost of all other audits that do not fall under these two conditions. It is important to note that even if a franchisee reimburses Best In Class Education Center for audit costs, this does not prevent the franchisor from potentially terminating the Franchise Agreement.