If payments are understated by 3% or more during an audit, what is the Cicis franchisee required to do?
Cicis Franchise · 2025 FDDAnswer from 2025 FDD Document
If we decided to conduct an audit because of your failure to provide any records or reports you are required to provide us or if an audit discloses an understatement in any way of 3% or more, then you will also reimburse us for all costs and expenses connected with the audit (including reasonable accounting and attorneys' fees). These remedies will be in addition to any other remedies we may have at Law or in equity.
Source: Item 22 — CONTRACTS (FDD pages 64–65)
What This Means (2025 FDD)
According to Cicis's 2025 Franchise Disclosure Document, if an audit reveals that payments have been understated by 3% or more, the franchisee is required to take specific actions. The franchisee must reimburse Cicis for all costs and expenses connected with the audit. This includes reasonable accounting and attorneys' fees.
In addition to covering the audit expenses, the Cicis franchisee must immediately pay the amount that was originally overdue or understated. This payment will also include interest, calculated according to the terms outlined in Section 4.G of the franchise agreement.
This policy incentivizes accurate financial reporting and provides Cicis with a mechanism to recover costs associated with uncovering significant underreporting. It is important for prospective franchisees to understand these financial obligations and ensure accurate record-keeping to avoid triggering an audit and incurring these additional expenses.