What certification is required for the year-end income statement and balance sheet submitted by a Body20 franchisee?
Body20 Franchise · 2025 FDDAnswer from 2025 FDD Document
- 8.2 Reports and Financial Statements. You agree to submit financial and operational reports and records to us at the times and in the manner specified in the Manuals. Upon our written request, by April 15 of each year, you must submit your balance sheet and income statement for the previous calendar year. With respect to your year-end income statement and balance sheet, you or the Operating Principal must certify that the income statement and balance sheet are correct and complete and that they have been prepared in accordance with generally accepted accounting principles. We have the right to demand audited financial statements if an Event of Default has occurred within the last calendar year. In addition, you must provide us within 15 days after our request, exact copies of federal and state income and other tax returns and any other forms, records, books, reports and other information that we periodically require relating to the Studio or you.
Source: Item 23 — RECEIPT (FDD pages 74–251)
What This Means (2025 FDD)
According to Body20's 2025 Franchise Disclosure Document, franchisees must submit their balance sheet and income statement for the previous calendar year to Body20 by April 15 of each year. The franchisee or the Operating Principal must certify the year-end income statement and balance sheet. This certification confirms that the documents are correct, complete, and prepared according to generally accepted accounting principles.
This requirement ensures that Body20 receives accurate and reliable financial information from its franchisees. The certification by the franchisee or Operating Principal places responsibility on them for the accuracy of the submitted financial statements. This is a standard practice in franchising, as it allows the franchisor to monitor the financial health of individual units and the overall network.
Body20 also retains the right to demand audited financial statements if an Event of Default occurred within the last calendar year. Additionally, franchisees must provide copies of federal and state income and other tax returns, along with any other required forms, records, books, reports, and information, within 15 days of Body20's request. These stipulations enable Body20 to maintain financial oversight and ensure compliance with the franchise agreement.