If Bft prepares an annual audit of the advertising fund, who bears the expense?
Bft Franchise · 2025 FDDAnswer from 2025 FDD Document
We are not required to audit the Fund, but we may retain independent certified public accountants to prepare an annual audit of the Fund, at the expense of the Fund.
Source: Item 11 — FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS AND TRAINING (FDD pages 37–50)
What This Means (2025 FDD)
According to Bft's 2025 Franchise Disclosure Document, Bft is not required to audit the Brand Development Fund. However, if Bft chooses to have the fund audited by independent certified public accountants, the expense for this audit will be borne by the Brand Development Fund itself.
This means that franchisee contributions to the fund could be used to pay for the audit. While Bft is not obligated to conduct an audit, the option to do so exists, and the cost would not be directly paid by Bft, but rather from the pooled advertising funds contributed by franchisees.
It is typical in franchising for advertising funds to be used for the benefit of the entire franchise system, including covering reasonable administrative costs. The fact that the audit expense can be covered by the fund aligns with this practice. Prospective franchisees should consider this when evaluating the overall costs and benefits of contributing to the Brand Development Fund.