What is the reason Chatime cannot provide three years of financial statements?
Chatime Franchise · 2025 FDDAnswer from 2025 FDD Document
[Item 21: Financial Statements]
Item 21: Financial Statements
Attached as Exhibit A are our audited financial statements, as of December 31, 2024. We have not been in business for three years or more and cannot include all the financial statements required by the FTC Rule for our last three fiscal years. Our fiscal year end is December 31.
Source: Item 21 — Financial Statements (FDD page 58)
What This Means (2025 FDD)
According to Chatime's 2025 Franchise Disclosure Document, the company has not been in business long enough to provide three years of financial statements. The FDD states that Chatime Franchise LLC was formed on July 12, 2022.
Because Chatime has only been operating since July 2022, the company includes its audited financial statements as of December 31, 2024, in Exhibit A of the FDD. The FTC requires a minimum of three years of financial statements to be included in the FDD, but makes exceptions for newer companies.
A prospective franchisee should consider that the financial statements only reflect a limited operating history. While audited financial statements for 2023 and 2024 are included, the shorter track record may make it more difficult to assess the financial stability and performance of the franchise system.