What financial reports must a Face Foundrie franchisee provide to the franchisor?
Face_Foundrie Franchise · 2025 FDDAnswer from 2025 FDD Document
including, without limitation, earnings or other financial information, Franchisor shall be entitled to disclose such information. In addition, Franchisee hereby expressly permits Franchisor to disclose any such information to potential purchasers (and their employees, agents and representatives) of Franchisor in connection with the sale or transfer of any equity interests or assets of Franchisor or any merger, reorganization or similar restructuring of Franchisor.
- 11.02 Periodic Reports. Franchisee must provide Franchisor with those financial reports, data, information and supporting records required thereby from time to time, including, without limitation:
- (a) A statement of relevant Gross Sales in the form required by Franchisor to be delivered as directed by Franchisor in advance of each payment of the Royalty Fee, Marketing Contribution, and other payments required to be made to Franchisor;
- (b) A monthly unaudited balance sheet and profit and loss statement in a form satisfactory to Franchisor covering Franchisee's Facial Bar for the prior month and fiscal year to date, all of which shall be certified by Franchisee as true and correct and delivered to Franchisor no later than the 5th day of each month;
- (c) Annual financial statements compiled or reviewed by an independent certified public accountant in a form satisfactory to Franchisor, which shall include a statement of income and retained earnings, a statement of cash flows and a balance sheet of Franchisee for each fiscal year, to be delivered to Franchisor no later than the 90th day after the end of such fiscal year;
- (d) An annual copy of Franchisee's signed tax filings (including all supporting schedules) as filed with the Internal Revenue Service (or any forms which take the place of those forms), and all other federal, state and local sales and use and income tax reports Franchisee is required to file, all to be delivered within thirty (30) days after filing;
- (e) A statement of local marketing expenditures made pursuant to Section 10.03 for fiscal year to date, in a form satisfactory to Franchisor, along with invoices documenting such expenditures (if required by Franchisor), to be delivered within ten (10) days after the end of each calendar month;
- (f) Insurance certificates in connection with Franchisee's annual renewal of the policies;
- (g) All health and safety inspection reports, to be delivered to Franchisor promptly upon receipt thereof by Franchisee; and
(h) Such other information as Franchisor may require from time to time, including product sales mix and labor reports, within thirty (30) days of Franchisor's request.
All such reports or other information shall be prepared (i) using any form documents established by Franchisor as set forth in the Operations Manual or otherwis
Source: Item 22 — CONTRACTS (FDD pages 73–74)
What This Means (2025 FDD)
According to Face Foundrie's 2025 Franchise Disclosure Document, franchisees are required to submit several financial reports to the franchisor. These reports allow Face Foundrie to monitor the financial health and performance of each franchise location and ensure compliance with the franchise agreement. The specific reports and their submission deadlines are outlined in the FDD.
Specifically, a Face Foundrie franchisee must provide a statement of relevant Gross Sales before each royalty payment, a monthly unaudited balance sheet and profit and loss statement by the 5th day of each month, annual financial statements compiled or reviewed by an independent certified public accountant within 90 days after the fiscal year end, and an annual copy of signed tax filings within 30 days after filing with the IRS. Additionally, franchisees must submit a statement of local marketing expenditures with supporting invoices within 10 days after each calendar month's end.
Beyond these regular financial submissions, Face Foundrie franchisees must also provide insurance certificates upon annual policy renewal and all health and safety inspection reports promptly after receipt. Furthermore, Face Foundrie retains the right to request other information, such as product sales mix and labor reports, with a 30-day notice. Failure to submit these reports by the deadlines may result in a late submission fee of $200.
All reports must be prepared using any form documents established by Face Foundrie, potentially including a designated chart of accounts, and in accordance with generally accepted accounting principles of the state in which the Facial Bar is located.