What happens to amounts remaining in the Southern Steer Brand Fund at the end of each year?
Southern_Steer Franchise · 2025 FDDAnswer from 2025 FDD Document
In any fiscal year, an amount greater or less than the aggregate contribution of all franchisees and licensees to the Brand Fund in that year may be spent.
The Brand Fund may borrow from Franchisor or other lenders to cover deficits or invest any surplus for future use.
Any amounts that remain in the Brand Fund at the end of each year accrue and may be applied toward the next year's expenses.
- 13.3.
Administration.
The Brand Fund will be administered by Franchisor.
Upon Franchisee's written request, Franchisor will send Franchisee an annual unaudited financial statement for the Brand Fund that indicates how the funds in the Brand Fund have been spent during the previous year.
Franchisor does not have the Brand Fund audited, so audited financial statements are not available.
Source: Item 22 — ITEM. 22 CONTRACTS (FDD pages 61–168)
What This Means (2025 FDD)
According to Southern Steer's 2025 Franchise Disclosure Document, any amounts remaining in the Brand Fund at the end of each year will accrue. These accrued amounts may then be applied toward the following year's expenses. This means that Southern Steer can carry over unspent funds from one year to the next, allowing for flexibility in managing the Brand Fund's resources.
Southern Steer may spend more or less than the total contributions from franchisees and licensees in any given fiscal year. To cover deficits, the Brand Fund can borrow from Southern Steer or other lenders. Conversely, any surplus can be invested for future use. This financial flexibility allows Southern Steer to strategically manage the Brand Fund based on current needs and future plans.
Southern Steer will administer the Brand Fund. Upon a franchisee's written request, Southern Steer will provide an annual unaudited financial statement detailing how the Brand Fund was spent in the previous year. However, Southern Steer does not have the Brand Fund audited, so audited financial statements are not available. This lack of an independent audit may be a concern for some franchisees, as it relies on the franchisor's self-reporting of fund expenditures.