Is a Bonchon Regional Advertising Cooperative required to prepare annual or periodic financial statements?
Bonchon Franchise · 2025 FDDAnswer from 2025 FDD Document
The Regional Advertising Cooperative will not be required to prepare annual or periodic financial statements. However, any financial statements that are generated as part of the books and records of the Cooperative will be available for review by franchisees that are members of the Cooperative. The Regional Advertising Cooperative will provide financial information about the Cooperative's operations upon request of the Board of the Cooperative, and the Board will then, in its discretion, present the report to you and the other members of the Cooperative at the next regular meeting or at a special meeting. (See Section 11.02 of the Sample By-Laws, Exhibit G to the Franchise Agreement.)
Source: Item 11 — FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS AND TRAINING (FDD pages 45–60)
What This Means (2025 FDD)
According to Bonchon's 2025 Franchise Disclosure Document, a Regional Advertising Cooperative is not required to prepare annual or periodic financial statements. However, any financial statements that are generated as part of the books and records of the Cooperative will be available for review by franchisees that are members of the Cooperative.
Bonchon franchisees who are part of the Regional Advertising Cooperative have the right to review any financial statements that are created. The Regional Advertising Cooperative will provide financial information about its operations if requested by the Cooperative's Board. The Board then has the discretion to present the report to the members at a regular or special meeting.
This arrangement allows Bonchon franchisees to stay informed about the financial activities of the Regional Advertising Cooperative, even though formal financial statements are not mandated. Franchisees should actively participate in Cooperative meetings and engage with the Board to exercise their right to access financial information and understand how advertising funds are being managed.