Is the Endless Summer Sweets Marketing Fund financial statement audited?
Endless_Summer_Sweets Franchise · 2024 FDDAnswer from 2024 FDD Document
erform the activities describedabove.
If requested by you in writing no sooner than 120 days after the end of our fiscal year, we will provide you with an annual unaudited statement of contributions and expenditures of the Advertising Fund for our most recently completed fiscal year. We will not be required to audit the Fund. If we expend less than the total contributions available in the Fund during any fiscal year, we will retain the remaining amount in the Fund and expend the unused sum during the following fiscal year.
Source: Item 11 — FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS, AND TRAINING (FDD pages 18–25)
What This Means (2024 FDD)
According to Endless Summer Sweets' 2024 Franchise Disclosure Document, the financial statements for the Marketing Fund are not required to be audited. However, if a franchisee requests it in writing no sooner than 120 days after the end of the fiscal year, Endless Summer Sweets will provide an annual unaudited statement of contributions and expenditures of the Advertising Fund for the most recently completed fiscal year.
This means that franchisees have the right to request a financial statement of the fund, but it will not be an audited statement. Audited financial statements provide a higher level of assurance regarding the accuracy and reliability of the information presented, as they are reviewed by an independent accounting firm. The lack of an audit may raise concerns about transparency and accountability in the management of the fund.
It is important for prospective Endless Summer Sweets franchisees to understand that the Brand Marketing Fund is not a trust or escrow account, and Endless Summer Sweets does not have any fiduciary obligations with respect to the fund or any advertising fees received. Endless Summer Sweets has no obligation to make expenditures on a franchisee's behalf that are equivalent or proportionate to their contributions to the Fund, to ensure that any particular franchisee benefits directly or pro rata from marketing or advertising they develop or place or to ensure that any advertising directly impacts a franchisee's business or penetrates their territory.