Is Bft required to audit the advertising fund annually?
Bft Franchise · 2025 FDDAnswer from 2025 FDD Document
ementation of any campaigns associated with the same. The Fund is not a trust or escrow account, and we have no fiduciary obligations regarding the Fund. 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. We will provide a copy of the annual accounting of the Fund to franchisees upon written request. Our company-owned or affiliate-owned Studios, if and when operating, are not required to contribute to the Fund at the same rate as franchisees.
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 conduct annual audits of its advertising fund. However, Bft may choose to have independent certified public accountants prepare an annual audit of the fund, with the expense covered by the fund itself.
While Bft is not obligated to audit the fund, they will provide franchisees with a copy of the annual accounting of the fund upon written request. This accounting offers some transparency into how the fund is being managed and spent. For the fiscal year ended December 31, 2024, the fund expenditures were allocated as follows: 9.8% for production, 58.5% for administration and implementation, 7.7% on media and public relations, and 24.0% for Internet and digital-related activities.
For a prospective Bft franchisee, this means that while there's no guarantee of a formal audit, some level of financial reporting is available. It would be prudent for a potential franchisee to make a written request for the annual accounting to understand how the advertising funds are being utilized and to assess whether the expenditures align with their expectations for brand promotion and development.