What is the duration of a fiscal year for a Browns Chicken franchise?
Browns_Chicken Franchise · 2025 FDDAnswer from 2025 FDD Document
dule does not accurately reflect the revenues or financial status of the Store or is otherwise incomplete or inaccurate, Brown shall have the right to require Franchisee to submit audited annual financial statements for all subsequent fiscal years during the term of the Franchise.
For purposes of the record keeping, reporting and fee payment requirements of this Agreement, a week shall be a seven-day period ending on Sunday. A "Monthly Period" is the four or five-week period ending on the last Sunday of the month and beginning on the day following the last Sunday of the immediately preceding month; the fiscal year of Franchisee shall be the period consisting of twelve (12) Monthly Periods ending on the last Sunday of a calendar year;
Source: Item 22 — Contracts (FDD page 43)
What This Means (2025 FDD)
According to Browns Chicken's 2025 Franchise Disclosure Document, the fiscal year for a franchisee is defined as a period consisting of twelve monthly periods. Each monthly period consists of either four or five weeks, ending on the last Sunday of the month and beginning on the day following the last Sunday of the immediately preceding month. The Browns Chicken fiscal year concludes on the last Sunday of the calendar year and is divided into four fiscal quarters, each comprising three consecutive monthly periods.
This definition of a fiscal year impacts the financial reporting requirements for Browns Chicken franchisees. Specifically, franchisees must submit a copy of their federal and state tax returns within 105 days after the end of their fiscal year. These reports and financial statements must be verified and signed by the franchisee in a manner prescribed by Browns Chicken.
Browns Chicken also retains the right to request audited annual financial statements from a franchisee for all subsequent fiscal years if they reasonably believe that any financial statement, tax return, or schedule submitted by the franchisee does not accurately reflect the revenues or financial status of the store or is otherwise incomplete or inaccurate. This ensures that Browns Chicken can maintain accurate oversight of the financial performance of its franchise locations.
For Browns Chicken franchisees, understanding these requirements is crucial for maintaining compliance with the franchise agreement and ensuring smooth operations. The franchisor's detailed definition of a fiscal year and its reporting requirements provide a structured framework for financial management and transparency within the Browns Chicken franchise system.