What collection procedures should the Franchisee apply when collecting billings for Management Recruiters?
Management_Recruiters Franchise · 2024 FDDAnswer from 2024 FDD Document
Franchisee shall endeavor in good faith to collect all billings made by Franchisor to customers of the Franchise Business and, in performing such work, shall apply substantially the same collection procedures and policies as are set forth in the Brand Standards Materials. The payments and accounts receivable that arise from all regular and temporary employee placement services provided by the Franchise Business shall be the exclusive property of Franchisor. Franchisee shall execute any assignments, authorizations or other documents as may be requested from time-to-time by Franchisor to allow it to accept, endorse and deposit all such remittances. The conversion of Franchisor receivables for Franchisee's uses for any period of time shall not be tolerated under any circumstances; indeed, converting Franchisor receivables, which are the property of the Franchisor, is considered to be larceny and punishable as a crime. If Franchisee cannot provide Franchisor an acceptable reason for the conversion of Franchisor receivables, Franchisor may report the matter to local law enforcement authorities.
Source: Item 23 — RECEIPTS (FDD pages 67–327)
What This Means (2024 FDD)
According to Management Recruiters' 2024 Franchise Disclosure Document, franchisees are required to make a good faith effort to collect all billings made by Management Recruiters to customers. In doing so, franchisees must apply collection procedures and policies that are substantially the same as those detailed in the Brand Standards Materials.
It is important to note that all payments and accounts receivable that arise from both regular and temporary employee placement services are the exclusive property of Management Recruiters. Franchisees are required to execute any assignments, authorizations, or other documents requested by Management Recruiters to facilitate the acceptance, endorsement, and deposit of these remittances.
The FDD also specifies that converting Management Recruiters' receivables for the franchisee's own use is strictly prohibited and considered a serious offense, potentially punishable as larceny. If a franchisee cannot provide an acceptable explanation for such conversion, Management Recruiters reserves the right to report the matter to law enforcement authorities. This underscores the importance of adhering to the prescribed collection procedures and maintaining transparency in financial dealings with Management Recruiters.