What financial documents are Cicis franchisees required to submit on a quarterly basis?
Cicis Franchise · 2025 FDDAnswer from 2025 FDD Document
4. RECORDS AND REPORTING REQUIREMENTS.
You agree, during the Term, to maintain records regarding your activities in connection with the exercise of the Development Rights and to provide us with the following records and reports:
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- within 10 days after the end of each month during the Term, you must send us a report of your business activities during that month, including information about your efforts to find sites for Restaurants in the Development Area and the status of development and projected opening for each Restaurant under development in the Development Area;
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- within 30 days after the end of each calendar quarter, you must provide us with a balance sheet and profit and loss statement for you and your Affiliates covering that quarter and the year-to-date, and an updated balance sheet for each person or entity signing the Guaranty; and
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- such other data, reports, information, financial statements, and supporting records as we request from time to time.
If you fail to submit, the foregoing information or report required by us we may, after first providing written notice and a reasonable opportunity to cure (which need not exceed 10 days), assess a reasonable data collection fee for so long as the information or report remains outstanding. Our assessment and collection of the data collection fee will be in addition to all other rights and remedies we have.
Source: Item 23 — RECEIPTS (FDD pages 65–263)
What This Means (2025 FDD)
According to Cicis's 2025 Franchise Disclosure Document, franchisees must provide specific financial documents to Cicis on a quarterly basis. Within 30 days after the end of each calendar quarter, franchisees are required to submit a balance sheet and a profit and loss statement. These financial statements must cover both the franchisee's operations and those of their affiliates for that quarter and the year-to-date. Additionally, franchisees must provide an updated balance sheet for each person or entity signing the Guaranty.
These reporting requirements allow Cicis to monitor the financial health and performance of its franchisees and their related entities. This helps Cicis ensure that franchisees are meeting their financial obligations and operating sustainably. The information also likely informs Cicis's decisions regarding support, compliance, and potential transfers or renewals of the franchise agreement.
Failure to submit these required documents can result in penalties. Cicis may assess a reasonable data collection fee if the franchisee fails to provide the information after receiving written notice and a reasonable opportunity to correct the issue, which need not exceed 10 days. This fee is in addition to any other rights and remedies Cicis may have, highlighting the importance of adhering to the reporting schedule and requirements.
It is common practice in the franchise industry for franchisors to require regular financial reporting from franchisees. This allows the franchisor to maintain oversight of the brand's overall financial stability and to identify potential issues early on. Prospective Cicis franchisees should be aware of these requirements and ensure they have the accounting systems and processes in place to comply with them.