Can Fly To Fit Franchise request financial statements from a Fly To Fit franchisee?
Fly_To_Fit Franchise · 2024 FDDAnswer from 2024 FDD Document
10.1 Systems.** Franchisee shall use such customer data management, sales data management, administrative, bookkeeping, accounting, and inventory control procedures and systems as Fly To Fit Franchise may specify in the Manual or otherwise in writing.
10.2 Reports.
- (a) Financial Reports. Franchisee shall provide such periodic financial reports as Fly To Fit Franchise may require in the Manual or otherwise in writing, including:
- (i) a monthly profit and loss statement and balance sheet for the Business within 30 days after the end of each calendar month;
- (ii) an annual financial statement (including profit and loss statement, cash flow statement, and balance sheet) for the Business within 90 days after the end of Fly To Fit Franchise's fiscal year; and
- (iii) any information Fly To Fit Franchise requests in order to prepare a financial performance representation for Fly To Fit Franchise's franchise disclosure document.
- (b) Legal Actions and Investigations. Franchisee shall promptly notify Fly To Fit Franchise of any Action or threatened Action by any customer, governmental authority, or other third party against Franchisee or the Business, or otherwise involving the Franchisee or the
Business. Franchisee shall provide such documents and information related to any such Action as Fly To Fit Franchise may request.
- (c) Government Inspections. Franchisee shall give Fly To Fit Franchise copies of all inspection reports, warnings, certificates, and ratings issued by any governmental entity with respect to the Business, within three days of Franchisee's receipt thereof.
- (d) Other Information.
Source: Item 22 — CONTRACTS (FDD page 44)
What This Means (2024 FDD)
According to Fly To Fit's 2024 Franchise Disclosure Document, Fly To Fit can request financial reports from its franchisees. Franchisees must provide a monthly profit and loss statement and balance sheet within 30 days after each calendar month's end. Additionally, franchisees must furnish an annual financial statement, including a profit and loss statement, cash flow statement, and balance sheet, within 90 days after the end of Fly To Fit's fiscal year.
Fly To Fit can also request any information needed to prepare a financial performance representation for its Franchise Disclosure Document. Beyond these periodic reports, Fly To Fit can request other financial statements, budgets, forecasts, reports, records, copies of contracts, documents related to litigation, tax returns, copies of governmental permits, and other documents and information related to the Business as specified in the Manual or that Fly To Fit may reasonably request.
Furthermore, within 120 days after opening, franchisees must submit a report detailing their investment costs to develop and open the Business, allocated to categories described in Item 7 of Fly To Fit's Franchise Disclosure Document, along with any other information Fly To Fit requests. Fly To Fit also has the right to examine and audit all books and records related to the Business at any reasonable time, either at the franchisee's location or by requiring the franchisee to deliver copies of the documents to a location designated by Fly To Fit.