Under what conditions does Dog Haus charge an Audit fee, and what is the estimated cost?
Dog_Haus Franchise · 2025 FDDAnswer from 2025 FDD Document
fault is not cured. | Payable if you default under your Franchise Agreement. |
| Name Of Fee | Amount | Due Date | Remarks |
|---|---|---|---|
| Audit | Cost of audit (estimated to be $1,000 - $5,000) plus interest at the highest rate allowed by law, which is currently 10% in California ( |
Source: Item 6 — OTHER FEES 1 (FDD pages 15–22)
What This Means (2025 FDD)
According to Dog Haus's 2025 Franchise Disclosure Document, an audit fee is charged if an audit reveals an understatement of 3% or more in Gross Sales. The cost of this audit is estimated to be between $1,000 and $5,000, and it is due on demand.
In addition to the cost of the audit, Dog Haus also charges interest on the underpaid amount. The interest rate is the highest rate allowed by law, which is currently 10% in California, but it will not exceed 18%. This interest applies from the date of the underpayment until it is fully paid.
For a prospective Dog Haus franchisee, this means it is crucial to maintain accurate sales records. Underreporting sales by 3% or more can trigger a costly audit, along with interest charges on the deficiency. Franchisees should ensure their accounting practices are sound and transparent to avoid these fees. This is a fairly standard practice in franchising, as franchisors need to ensure accurate royalty payments, which are typically based on a percentage of gross sales.