Who must sign the annual revenue report for a Closet Storage Concepts franchise?
Closet_Storage_Concepts Franchise · 2025 FDDAnswer from 2025 FDD Document
- 3.3.6 Annual Revenue Report.
Within sixty (60) days after the close of Franchisee's fiscal year, Franchisee shall furnish a statement, on forms provided by Franchisor, containing all of the information requested on such forms, certified to by Franchisee and signed by Franchisee's accountant, showing the total net revenue for said preceding fiscal year, as finally adjusted and reconciled after the closing and review of Franchisee's books and records for such fiscal year.
If such statement discloses any underpayment of royalties for such fiscal year, Franchisee shall pay to Franchisor, at the time of submitting such statement, the amount of any such underpayment.
Any overpayment shall be credited to Franchisee's account, if confirmed by Franchisor and/or Franchisor's accountant.
Source: Item 22 — CONTRACTS (FDD page 59)
What This Means (2025 FDD)
According to Closet Storage Concepts' 2025 Franchise Disclosure Document, the franchisee and the franchisee's accountant must sign the annual revenue report. The franchisee must furnish a statement, on forms provided by Closet Storage Concepts, containing all requested information. This statement must be certified by the franchisee and signed by the franchisee's accountant. The report must show the total net revenue for the preceding fiscal year, as adjusted and reconciled after the closing and review of the franchisee's books and records for that year.
This requirement ensures that Closet Storage Concepts receives accurate and verified financial information from its franchisees. By requiring both the franchisee and their accountant to sign the report, Closet Storage Concepts aims to increase the reliability of the reported revenue figures. This process helps Closet Storage Concepts monitor the financial performance of its franchises and calculate royalty payments accurately.
If the annual revenue report reveals any underpayment of royalties, the franchisee is required to pay the owed amount to Closet Storage Concepts at the time of submitting the statement. Conversely, any overpayment, if confirmed by Closet Storage Concepts or its accountant, will be credited to the franchisee's account. This reconciliation process ensures financial transparency and accuracy in the royalty payments between the franchisee and Closet Storage Concepts.
Franchisees should ensure they maintain accurate financial records throughout the year to facilitate the preparation of the annual revenue report. Selecting a qualified accountant who is familiar with franchise accounting practices is also advisable to ensure compliance with Closet Storage Concepts' reporting requirements.