What information must be included in the Royalty Report that Crave franchisees must submit?
Crave Franchise · 2025 FDDAnswer from 2025 FDD Document
In addition to the Royalty Report required by Article 4 hereof, you shall comply with the following reporting obligations:
- 11.2.1 You shall, at your expense, submit to us, in the form prescribed by us, a report of Gross Sales and a profit and loss statement for each month (which may be unaudited) for you within ten (10) days after the end of each month during the term hereof. Each such statement shall be signed by your treasurer or chief financial officer or comparable officer attesting that it is true, complete and correct;
- 11.2.2 You shall, at your expense, provide to us a complete annual financial statement (which shall be reviewed) prepared by an independent certified public accountant by April 15th of each year during the term hereof showing the results of the Franchised Business' operations during the previous calendar year. We reserve the right to require such financial statements to be audited by an independent certified public accountant satisfactory to us at your cost and expense if an inspection discloses an understatement of two percent (2%) or more in any report, pursuant to Section 11.3; and
- 11.2.3 You shall also submit to us, for review or auditing, such other forms, reports, records, information and data as we may reasonably designate, and which pertain to the Franchised Business, in the form and at the times and places reasonably required by us, upon request and as specified from time to time in writing.
Source: Item 23 — RECEIPTS (FDD pages 63–253)
What This Means (2025 FDD)
According to Crave's 2025 Franchise Disclosure Document, in addition to the Royalty Report, franchisees must submit a report of Gross Sales and a profit and loss statement each month within ten days after the end of the month. These reports do not have to be audited, but must be signed by the franchisee's treasurer, chief financial officer, or comparable officer, attesting to its truthfulness, completeness, and correctness. Franchisees must also provide a complete annual financial statement prepared by an independent certified public accountant by April 15th of each year. This annual statement should show the results of the Franchised Business' operations during the previous calendar year and must be reviewed. Crave retains the right to demand an audit of these financial statements if an inspection reveals an understatement of 2% or more in any report.
Crave also requires franchisees to submit any other forms, reports, records, information, and data that they may reasonably designate, pertaining to the Franchised Business. These additional submissions must be in the form, and at the times and places, reasonably required by Crave, upon request and as specified in writing from time to time.
These reporting obligations ensure that Crave has access to accurate and timely financial information from its franchisees, allowing them to monitor performance, calculate royalties, and maintain the integrity of the Crave system. Franchisees should be prepared to maintain detailed records and comply with these reporting requirements to avoid potential penalties or disputes with the franchisor.