In what manner must a Browns Chicken franchisee verify and sign each report and financial statement?
Browns_Chicken Franchise · 2025 FDDAnswer from 2025 FDD Document
al year-end balance sheet and an annual profit and loss statement for such fiscal year, reflecting all year-end adjustments;
and (5) within 105 days after the end of Franchisee's fiscal year, a copy of Franchisee's federal and state tax returns as filed with each taxing authority.
Each report and financial statement required by this Section 12 shall be verified and signed by Franchisee in the manner prescribed by Brown. Franchisee agrees to maintain and furnish, on request by Brown, complete copies of federal and state income tax returns filed by Franchisee with the Internal Revenue Service and state tax departments reflecting sales and income of the Store or the corporation or partnership that holds the Franchise.
If Brown reasonably believes that any financial statement, tax return or schedule 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;
Source: Item 22 — Contracts (FDD page 43)
What This Means (2025 FDD)
According to Browns Chicken's 2025 Franchise Disclosure Document, all reports and financial statements that a franchisee is required to submit must be verified and signed in a manner that Browns Chicken prescribes.
This means that Browns Chicken has the authority to dictate the specific method by which franchisees must verify and sign these documents. This could include specifying the use of digital signatures, requiring notarization, or mandating a particular form of certification. It is important for prospective franchisees to clarify with Browns Chicken what specific procedures are required for verifying and signing reports and financial statements.
Furthermore, Browns Chicken retains the right to request audited annual financial statements from a franchisee if they reasonably believe that the submitted financial statement or tax return is inaccurate or incomplete. This highlights the importance of maintaining accurate and transparent financial records as a Browns Chicken franchisee. Franchisees are also obligated to provide Browns Chicken with the contact information of their accountant and authorize the accountant to release financial records and sales information to Browns Chicken upon request.