When is the Audit fee due for a Casa De Corazon franchise?
Casa_De_Corazon Franchise · 2025 FDDAnswer from 2025 FDD Document
| Type of Fee | Amount (Note 1) | Due Date | Remarks |
|---|---|---|---|
| Audit | Cost of audit, including the charges of any independent accountant and the travel expenses, room and board, and compensation of persons we employ to make the audit. | Upon demand. | Payable only if audit shows an under- statement of at least 2% of Gross Revenue for any month. |
Source: Item 6 — OTHER FEES (FDD pages 11–15)
What This Means (2025 FDD)
According to Casa De Corazon's 2025 Franchise Disclosure Document, the audit fee is due upon demand. This fee covers the cost of the audit, including charges from independent accountants, travel expenses, room and board, and compensation for Casa De Corazon employees involved in the audit.
However, a Casa De Corazon franchisee is only responsible for paying the audit fee if the audit reveals an understatement of at least 2% of gross revenue for any month. This condition provides some protection to franchisees, as they are not automatically subject to audit fees unless a significant discrepancy is found.
In the franchise industry, it is common for franchisors to reserve the right to audit franchisee records to ensure compliance with reporting requirements and to verify royalty payments. The specific terms and conditions for audits, including when fees are charged, can vary widely among different franchise systems. Therefore, prospective Casa De Corazon franchisees should understand the circumstances under which an audit may be conducted and the potential costs involved.