What certifications must accompany the financial statements submitted by a Buona franchisee?
Buona Franchise · 2025 FDDAnswer from 2025 FDD Document
submit to Franchisor, with each Period Statement or Quarterly Statement, copies of any state or local sales tax returns filed by Franchisee for the period included in the Period Statement or Quarterly Statement.
4.4 Financial Statements. Franchisee shall, at its expense, submit to Franchisor during the Term of this Agreement, unaudited financial statements for the preceding Period and for the preceding fiscal year ("Financial Statements"), together with a certificate executed by Franchisee certifying that such financial statement, as applicable, is true and accurate and such other information in such form as Franchisor may reasonably require. The foregoing Financial Statements shall include both a profit and loss statement and a balance sheet, and shall be prepared in accordance with generally accepted accounting principles. Franchisee must furnish Franchisor with any additional financial statements and any tax returns for the Franchised Business within fifteen (15) days after Franchisee's receipt of Franchisor's written request for the information. In the event Franchisee defaults under this Agreement, Franchisor may require, upon written notice to Franchisee, that all Financial Statements submitted thereafter include a "Review Report" prepared by an independent Certified Public Accountant (CPA).
4.5 Other Reports; Reporting Requirements. Franchisee shall also submit to Franchisor, for review or auditing, such other forms, financial statements, reports, records, information and data as Franchisor may reasonably designate, in the form and in the manner and at the times and places reasonably required by Franchisor, upon request and as specified from time to time in the Manuals or otherwise in writing.
Source: Item 22 — CONTRACTS (FDD page 78)
What This Means (2025 FDD)
According to Buona's 2025 Franchise Disclosure Document, franchisees must submit financial statements with a certificate. This certificate must be executed by the franchisee, confirming that the financial statement is true and accurate. These financial statements include both a profit and loss statement and a balance sheet, and they must be prepared following generally accepted accounting principles.
During the first year of operation, Buona requires franchisees to use a designated accounting service for preparing financial statements and financial reporting. After this initial period, if a franchisee fails to comply with the financial reporting requirements, Buona can mandate the franchisee to revert to using Buona's designated accounting service.
In the event a Buona franchisee defaults on their agreement, Buona has the right to demand that all future financial statements include a "Review Report" prepared by an independent Certified Public Accountant (CPA). Additionally, Buona requires franchisees to provide any additional financial statements and tax returns for the franchised business within 15 days of a written request from Buona.