Are the monthly financial statements that Dryject franchisees submit required to be audited?
Dryject Franchise · 2025 FDDAnswer from 2025 FDD Document
You shall also submit to Us Your current financial statement and other forms, records, reports, information and data as We may reasonably designate, in the form, and at the times and the places reasonably required by Us, upon request, and as specified from time to time in the Operations Manual or otherwise in writing.
(c) You shall permit Our authorized personnel to inspect, examine, compile, review and/or audit all of Your business records relating to Your Franchised Business, including but not limited to financial documents and tax returns, at any time during normal business hours without any prior notice.
(d) You shall also permit accountants designated by Us to audit Your books of accounts. In the event that We find that You have understated the amount due to Us and that any such understatement has been made deliberately, such understatement shall constitute an Event of Default and be considered a Material Breach of this Agreement as defined in Section 32(d)(iv) of this Agreement. Should any audit reveal an understatement of five percent (5%) or more of the amount otherwise due to Us, or if the understatement is determined to be deliberate, You will bear the costs and expenses of Our audit and inspection, and the deficiency shall be immediately due and payable with interest from the date the payments should have been made.
(e) Any inspection or audit of business records or books of accounts is solely for determining Your compliance with Your contractual obligations and does not constitute control over Your dayto-day operation of the Franchised Business.
(f) The provisions of this Section 22 shall survive the termination or expiration of this Agreement.
Source: Item 8 — BUSINESS RELATIONSHIP (FDD pages 68–229)
What This Means (2025 FDD)
According to Dryject's 2025 Franchise Disclosure Document, franchisees are required to submit current financial statements and other records as reasonably requested by Dryject. While franchisees must provide these statements, the FDD does not state that the monthly financial statements franchisees submit are required to be audited.
However, Dryject retains the right to inspect, examine, compile, review, and/or audit all business records, including financial documents and tax returns, at any time during normal business hours without prior notice. Dryject can also designate accountants to audit the franchisee's books.
If an audit reveals that a franchisee has understated the amount due to Dryject by five percent (5%) or more, or if the understatement is determined to be deliberate, the franchisee will bear the costs and expenses of the audit and inspection. In such cases, the deficiency becomes immediately due and payable with interest from the date the payments should have been made. This clause incentivizes franchisees to maintain accurate financial records and remit all due payments to Dryject, as inaccuracies can lead to costly audits and penalties.