Are the Advertising Funds audited by Exit?
Exit Franchise · 2025 FDDAnswer from 2025 FDD Document
All Franchisees are required to contribute Advertising Funds at the same rate. Each of the Funds and an accounting of advertising expenditures is administered by EXIT. The Funds are not audited.
Annual financial statements and an accounting of the Funds will be sent to you via email or U.S. mail upon your written request sent to EXIT via email to snanan@exitrealty.com, or U.S. mail to EXIT Realty Corp. International, Attention: Steve Nanan, 2626 Argentia Road, Mississauga, Ontario, Canada, L5N 5N2.
Any Fund amount remaining at the end of a calendar year is carried over to be used in the future.
In the most recently concluded calendar year, EXIT spent 11.87% of the Funds on production, 2.01% of the Funds on media placement, 0% of the Funds on administrative expenses, 57.5% of the Funds on EXIT's website and internet marketing, 16.43% of the Funds on promotions and 40.51% of the Funds for regional development.
Source: Item 11 — FRANCHISOR'S AND SUBFRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS AND TRAINING (FDD pages 19–24)
What This Means (2025 FDD)
According to Exit's 2025 Franchise Disclosure Document, the advertising funds are not audited. However, Exit administers each of the Funds and provides an accounting of advertising expenditures. Franchisees can request annual financial statements and an accounting of the Funds in writing via email or U.S. mail.
Specifically, Exit allocates advertising fees to the United States Creative Fund, the United States Promotional Fund, and the Regional Development Fund. These funds are used for various advertising and promotional activities at the national, regional, and local levels. While Exit is not obligated to spend any specific amount on advertising in any particular area, the Regional Development Fund is designated for regional development within the region where the fees are generated.
In the most recently concluded calendar year, Exit spent 11.87% of the Funds on production, 2.01% of the Funds on media placement, 0% of the Funds on administrative expenses, 57.5% of the Funds on Exit's website and internet marketing, 16.43% of the Funds on promotions and 40.51% of the Funds for regional development. Any remaining amount in the Funds at the end of the calendar year is carried over for future use.
While the advertising funds are not audited, the availability of financial statements and expenditure accounting provides a degree of transparency for franchisees. It is important for prospective franchisees to review these statements carefully to understand how advertising funds are being utilized and to assess the effectiveness of Exit's advertising strategies.