If requested by Card My Yard, what standards must my financial statements meet?
Card_My_Yard Franchise · 2025 FDDAnswer from 2025 FDD Document
(1) You have provided to us your most recent financial statements (if such statements have
been requested by us). Such financial statements, if requested, shall present fairly your financial position at the dates indicated therein and the results of your operations and cash flow for the years then ended. Each of the financial statements must be certified astrue and correct and must be prepared in conformity with generally accepted accounting principles and, except as expressly described in the applicable notes, applied on a consistent basis. There are no materialliabilities, adverse claims, commitments or obligations of any nature, whether accrued, unliquidated, absolute, contingent or otherwise, which are not reflected as liabilities on the financial statements.
- (2) At our request, you agree to provide us with any and all loan or other documents regarding the financing of the Card My Yard business.
- (3) You agree to maintain at all times during the term of this Agreement sufficient working capital to fulfill your obligations under this Agreement.
Source: Item 23 — RECEIPTS (FDD pages 84–259)
What This Means (2025 FDD)
According to Card My Yard's 2025 Franchise Disclosure Document, if financial statements are requested from a franchisee, they must accurately represent the franchisee's financial standing at the specified dates, along with the outcomes of their operations and cash flow for the corresponding years. These financial statements must be certified as accurate and adhere to generally accepted accounting principles (GAAP), applied consistently unless otherwise noted. Additionally, all material liabilities, claims, commitments, or obligations must be reflected as liabilities in the financial statements.
This means a prospective Card My Yard franchisee needs to ensure their financial record-keeping is meticulous and compliant with GAAP standards. They should maintain organized and accurate records of all financial transactions, as these records may be subject to review by Card My Yard. Failing to meet these standards could lead to issues with the franchisor and potential disputes.
Furthermore, the franchisee must be prepared to provide any loan or financing documents related to their Card My Yard business if requested. They are also obligated to maintain sufficient working capital to meet their obligations under the Franchise Agreement. This underscores the importance of sound financial management and planning for any Card My Yard franchisee.