Is a Bonchon franchisee required to furnish financial and non-financial data concerning the activity of their Business if requested by Bonchon?
Bonchon Franchise · 2025 FDDAnswer from 2025 FDD Document
g the end of each calendar quarter during the term of this Agreement, you agree to furnish to us, in a form we approve, a statement of the franchised Business's profit and loss for the quarter and a balance sheet as of the end of the quarter. You must certify these statements to be true and correct.
- B. No later than 90 days following the end of each of your fiscal years during the term of this Agreement, you agree to furnish to us, in a form we approve, a statement of the franchised Business's profit and loss for the fiscal year and a balance sheet as of the end of the fiscal year, prepared on a compilation basis and certified to be true and correct by you. We reserve the right to require these annual financial statements to be audited by an independent certified public accountant.
- C. The financial statements required above must be prepared in accordance with United States generally accepted accounting principles, including all disclosures required under those principles.
- D. No later than 30 days following your filing of the annual tax returns of the franchised business, you agree to furnish to us exact copies of the tax returns, including federal, state and any local income tax returns, together with a certificate from an independent certified public accountant that all Social Security payments, taxes and fees required to be paid by you to any governmental agency or entity have been paid, and that if you are a business entity, there is no reason to believe that your entity's status has been impaired.
- E. You must also provide any other information that we reasonably request from time to time.
- F. If you do not timely furnish to us any of the financial statements or tax returns required above in this Article 10 then you agree to pay us a late charge of $50 per month that each financial statement or tax return is overdue. We may also in such circumstance
Source: Item 23 — RECEIPTS (FDD pages 92–536)
What This Means (2025 FDD)
According to Bonchon's 2025 Franchise Disclosure Document, franchisees are required to furnish both financial and non-financial data to Bonchon. Specifically, Bonchon requires franchisees to submit a profit and loss statement and a balance sheet for the franchised business within 90 days following the end of each fiscal year. These financial statements must be prepared according to United States generally accepted accounting principles and certified as true and correct by the franchisee. Bonchon retains the right to demand that these statements be audited by an independent certified public accountant.
Furthermore, franchisees must furnish exact copies of their annual tax returns, including federal, state, and local income tax returns, within 30 days of filing. This submission must include a certificate from an independent certified public accountant confirming that all required Social Security payments, taxes, and fees have been paid to governmental entities and that the business entity's status is not impaired.
In addition to these specific requirements, Bonchon also stipulates that franchisees must provide any other information that Bonchon reasonably requests from time to time. Failure to provide the required financial statements or tax returns on time will result in a late charge of $50 per month for each overdue item. Bonchon also reserves the right to terminate the franchise agreement if these requirements are not met after providing notice and an opportunity to correct the default. Bonchon is also authorized to incorporate information derived from these financial statements into their franchise disclosure document or promotional materials, provided that the franchisee or their Bonchon business is not individually identified.