What is the due date for the Audit Fee for a Chatime franchise?
Chatime Franchise · 2025 FDDAnswer from 2025 FDD Document
| Fee(1) Type of | Amount | Due Date | Remarks |
|---|---|---|---|
| Audit Fee | Cost of audit | As invoiced | Payable if (i) we find that you have understated any amount you owe to us by more than 2%, or (ii) you fail to furnish reports, supporting records, other information or financial statements as required on a timely basis and we believe an audit is necessary. The Audit Fee includes accountants' fees, legal fees, and associated travel and accommodation expenses for our employees. |
Source: Item 6 — Other Fees (FDD pages 13–17)
What This Means (2025 FDD)
According to Chatime's 2025 Franchise Disclosure Document, the Audit Fee is due 'as invoiced.' This means that Chatime will send the franchisee an invoice for the cost of the audit, and the franchisee must pay by the due date specified on that invoice.
The Audit Fee is payable if Chatime finds that the franchisee has understated any amount owed to them by more than 2%, or if the franchisee fails to furnish reports, supporting records, other information, or financial statements as required on a timely basis, and Chatime believes an audit is necessary. The Audit Fee covers accountants' fees, legal fees, and associated travel and accommodation expenses for Chatime's employees.
This arrangement is fairly standard in franchising, where franchisors often reserve the right to audit franchisees to ensure compliance with financial reporting requirements. The 'as invoiced' payment term is also common, providing franchisees with a specific payment deadline after receiving the bill. Franchisees should maintain accurate records and submit all required reports on time to avoid triggering an audit and incurring this fee.