What constitutes an 'inadvertent error' when understating gross revenue for a Bumble Roofing franchisee?
Bumble_Roofing Franchise · 2025 FDDAnswer from 2025 FDD Document
- (f) "Gross Revenues" means the total of all receipts derived from all sales of products and services in connection with Franchisee's Roofing Business, including, without limitation, labor, insurance claims for lost profits to the extent a claim is paid by the insurer, and all other products and services sold or performed by or for Franchisee or Franchisee's Roofing Business or by means of the business conducted under this Agreement, whether the receipts are evidenced by cash, credit, checks, gift certificates, scrip, coupons, services, property or oth
Source: Item 22 — CONTRACTS (FDD page 53)
What This Means (2025 FDD)
I am unable to provide information on what constitutes an 'inadvertent error' when understating gross revenue for a Bumble Roofing franchisee, according to the 2025 Franchise Disclosure Document. While the document defines 'Gross Revenues' as the total receipts from sales of products and services, including labor and insurance claims, it does not specify what would be considered an 'inadvertent error' in understating these revenues.
Item 22 of the FDD discusses various aspects of the franchise agreement, including definitions of key terms like 'Business,' 'Confidential Information,' 'Franchise,' and 'Gross Revenues.' It also covers topics such as advertising and promotion requirements, termination conditions, and the franchisee's obligations regarding training and compliance with Bumble Roofing's standards. However, it does not delve into the specifics of error classification related to revenue reporting.
A prospective Bumble Roofing franchisee should directly ask the franchisor for clarification on what constitutes an 'inadvertent error' in understating gross revenues. Understanding this distinction is crucial, as it could have implications for compliance, audits, and potential penalties. Specifically, the franchisee should inquire about the procedures for correcting errors, the thresholds for triggering audits, and the potential consequences of both inadvertent and intentional underreporting of gross revenues.