When are audit fees for a Corcoran franchise due?
Corcoran Franchise · 2025 FDDAnswer from 2025 FDD Document
| $5,000,001 | $10,000,000 | 0.75% | | $10,000,001 | * | 0.50% | | Name of Fee | Amount | Due Date | Remarks | |------------------------------|-------------|-------------------------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------| | Audit Fees | See remarks | upon receipt of the audit report | You must immediately pay us any fees that the audit reveals were due during the audit period but not paid, plus interest at Prime plus 2%. If you fail to cooperate on a timely basis with an audit, fail to keep auditable records, cancel or reschedule the audit, or if the audit exposes a deficiency of 5% or more in amounts due for any consecutive 3-month period, you also must pay all of our audit costs, plus fees past due, interest, late charges and costs. As of the issuance date of this disclosure document, the estimated cost for an audit is a minimum of $450 per day; however, we and our Related Parties have the right to increase the minimum per diem rate by up to 10% per year. For existing franchisees, the criteria that may require payment of audit fee
Source: Item 6 — OTHER FEES [1] [2] (FDD pages 27–34)
What This Means (2025 FDD)
According to Corcoran's 2025 Franchise Disclosure Document, audit fees are due upon receipt of the audit report. If an audit reveals that fees were underpaid during the audit period, the franchisee must immediately pay the due amounts plus interest at the prime rate plus 2%.
Furthermore, Corcoran outlines specific circumstances that may trigger the franchisee's responsibility for covering audit costs. These include failing to cooperate with the audit in a timely manner, not maintaining auditable records, canceling or rescheduling the audit, or if the audit uncovers a deficiency of 5% or more in the amounts due for any consecutive 3-month period. In such cases, the franchisee is liable for all of Corcoran's audit costs, along with any past due fees, interest, late charges, and costs.
As of the issuance date of the 2025 disclosure document, the estimated cost for an audit is a minimum of $450 per day; however, Corcoran and its related parties retain the right to increase the minimum per diem rate by up to 10% per year. Existing franchisees may have varying criteria for audit fee payments based on their individual Franchise Agreements, so prospective franchisees should review these terms carefully.