How does Focus Cfo record compensation payable to franchisees and licensees?
Focus_Cfo Franchise · 2025 FDDAnswer from 2025 FDD Document
or authority to bind Focus CFO except as set forth in this Section 7 and provided for in Attachment F.
8. PAYMENTS; INDEPENDENT CONTRACTOR STATUS
- 8.1. Focus CFO shall pay Franchisee as an independent contractor according to the current Compensation Policy. The Compensation Policy is adopted by Focus CFO management. The current Compensation Policy is attached as Attachment B. Focus CFO has the right to modify the Compensation Policy by providing Franchisee with at least thirty (30) days' prior notice. However, Focus CFO cannot adjust each individual percentage rate set forth in the then-current Compensation Policy by more than one individual percentage point per year without Franchisee's prior written consent. See Attachment B for examples.
- 8.2. Franchisee is responsible for all Federal, state and local/city estimated tax payments and self-employment taxes on payments from Focus CFO. Focus CFO will remit to Franchisee compensation at a gross amount with no deduction for taxes. At the end of each year, Franchisee will receive a Form 1099 from Focus CFO.
- 8.3. This Agreement does not create a fiduciary relationship between the parties and nothing in this Agreement is intended to make either party a general or special agent, legal representative, subsidiary, joint venture, partner, employee or servant of the other for any purpose.
- 8.4. Franchisee acknowledges and agrees that, under this Agreement, Franchisee is and will be an independent contractor. Franchisee is not an employee of Focus CFO for any purpose, most particularly with respect to any mandated or other employee benefits or insurance coverage, tax, or contributions, or requirements pertaining to withholdings, levied of fixed, by any city, state, or federal governmental agency.
9. EXPENSES AND BENEFITS
- 9.1. Franchisee will incur its own expenses related to a business computer and software, printer, mobile phone, internet access, meals and entertainment, travel, automobile and mileage. Franchisee will pay its own mailings and correspondence.
- 9.2. Franchisee is required to have a business computer. Focus CFO does not require a specific brand or model of business computer, other hardware or Internet provider. However, Focus CFO requires the business computer meet minimum specifications as determined by Focus CFO's IT provider. High-speed internet access for Franchisee's home office is strongly recommended.
- 9.3. Franchisee is required to pay a recurring IT Services fee as outlined in Attachment G.
- 9.4. Franchisee shall provide its own transportation to and from networking and prospect/client meetings.
- 9.5.
Source: Item 23 — Receipts (FDD pages 37–126)
What This Means (2025 FDD)
According to Focus Cfo's 2025 Franchise Disclosure Document, Focus CFO pays franchisees as independent contractors based on the current Compensation Policy adopted by Focus CFO management, which is included as Attachment B to the Franchise Agreement. Focus CFO retains the right to modify this policy, providing franchisees with at least thirty days' prior notice. However, Focus CFO cannot adjust individual percentage rates within the Compensation Policy by more than one percentage point per year without the franchisee's written consent. Franchisees receive a gross amount with no tax deductions, and they are responsible for all federal, state, and local estimated tax payments and self-employment taxes. At the end of each year, Focus CFO provides franchisees with a Form 1099.
Client payments are made directly to Focus CFO, who then distributes payments to franchisees as independent contractors according to the Compensation Policy outlined in Attachment B. Franchisees and CFO licensees are not authorized to provide services to prospective clients until Focus CFO has a signed Professional Service Agreement (PSA) on file. Payments received from businesses without a signed PSA will be returned, and no payments will be made to the franchisee for those amounts.
Fees generated from services are allocated between the franchisee, licensee, and Focus CFO, as detailed in the Franchise Agreement and Licensing Agreement. This allocation underscores the importance of understanding both agreements for prospective franchisees. Area Presidents who voluntarily terminate their Franchise Agreement and elect to be a Licensee to perform CFO Services or perform more than eight days of billable client work a month as a CFO will not be paid the base rate payment on their Book of Business and will only be paid for the CFO services pursuant to a Licensing Agreement with Focus CFO. Focus CFO also retains the discretion to pay other forms of activity-based compensation to Area Presidents on an individual and case-by-case basis.