For how long is a new Buona franchisee required to use a designated accounting service?
Buona Franchise · 2025 FDDAnswer from 2025 FDD Document
During the first twelve (12) months of operation, Franchisee is required to engage and use an accounting service designated by Franchisor for preparation of financial statements and financial reporting.
After the first twelve (12) months of operation, if at any time Franchisee is not in full compliance with the requirements of this Section VI., Franchisor can, by delivery of written notice, require Franchisee to once again engage and use the services of an accounting service designated by Franchisor.
Source: Item 22 — CONTRACTS (FDD page 78)
What This Means (2025 FDD)
According to Buona's 2025 Franchise Disclosure Document, a new franchisee is required to use an accounting service designated by Buona for the first 12 months of operation. This requirement ensures that the franchisee's financial statements and reporting are prepared in a manner consistent with Buona's standards during the initial phase of the business.
After this initial 12-month period, the franchisee may choose their own accounting service, provided they remain in full compliance with the financial requirements outlined in Section VI of the franchise agreement. However, if the franchisee fails to maintain compliance at any time, Buona reserves the right to mandate the franchisee to re-engage a designated accounting service. This provision allows Buona to maintain control over financial reporting and ensure uniformity across the franchise system.
This requirement is fairly common in franchising, as it allows the franchisor to ensure consistent and accurate financial reporting across all locations, especially during the critical startup phase. For a prospective Buona franchisee, this means budgeting for the cost of a designated accounting service for the first year and understanding the importance of maintaining financial compliance to avoid being required to use the designated service again in the future.