Franchise 101: Things You Should Know | Franchise Law Blog

Franchisor Basics: Disclosure of Financial Statements

blog-detail-img

Under the Federal Franchise Rule franchisors are required to disclose their “Financial Statements” in Item 21 of the Franchise Disclosure Document. All financial statements must be prepared in accordance with Generally Accepted Accounting Principals (GAAP) and in all but an extremely limited number of situations involving a start-up franchisor, a franchisor’s financial statements must be “audited.” In the franchise regulations (16 CFR Parts 436 and 437) FTC provides detailed information respecting a franchisor’s Item 21 disclosure requirements, including:

Other provisions apply for start-up franchisors (a topic that will be discussed in future posts) and the disclosure of the financial statements of a franchisor’s affiliates.

Related Articles:

Date: 02/01/2016 | Category: Start a Franchise

Let's Talk

With services to make your growth strategy simple, cost effective, and with a team excited to help you, let’s talk about how we can help grow your brand. Click on the button below or call us at (800) 976-4904.

Let’s Talk

With services to make your growth strategy simple, cost effective, and with a team excited to help you, let’s talk about how we can help grow your business.

Fill out the following form and we’ll contact you as soon as possible. To reach our team directly, give us a call at (800) 976-4904.


closeIcon