Franchise Audit & Compliance Resources

Why New Franchisors Need an Opening Balance Sheet Audit to File Their FDD

Articles, Blogs, Franchise / Mohamed Metwally, CPA

Are you a new franchisor that about to file your first FDD? If so, this article is for you. ]]For aspiring franchisors, launching a successful franchise begins with meticulous planning and compliance with regulatory requirements. One crucial step often overlooked by new franchisors is obtaining an opening balance sheet audit, a key component in the […]

Why New Franchisors Need an Opening Balance Sheet Audit to File Their FDD Read More »

Franchise Accounting and Auditing vs. Traditional: Why It Matters in 2025

Articles, Blogs, Franchise / Mohamed Metwally, CPA

If you’re a franchisor or franchisee, you already know that running a franchise is a different ballgame than running a typical small business. Franchisors accounting and auditing can be a challenge that you have to overcome to be a successful franchisor/franchisee. There are differences between franchise accounting and auditing and any other industries (i.e. manufacturing,

Franchise Accounting and Auditing vs. Traditional: Why It Matters in 2025 Read More »

7 ways Leveraging AI for Franchise Accounting and Auditing: A Game Changer for Franchisors

Articles, Franchise / Mohamed Metwally, CPA

Now that everyone is talking about AI, franchisors as well as other small business owners need to seriously start thinking about using AI in most, if not all, of their tasks, but specifically in the tedious accounting and auditing tasks (Here, I called them boring :)). As the franchise industry grows, managing financial records and

7 ways Leveraging AI for Franchise Accounting and Auditing: A Game Changer for Franchisors Read More »

3 Steps for clean accounting books for Franchisors

Articles, Blogs, Franchise / Mohamed Metwally, CPA

Introduction: In the dynamic world of franchising, efficient accounting practices are crucial for the success of both franchisors and franchisees. Franchisors serve as the backbone of any franchise system, providing support and guidance to their franchisees while also ensuring financial transparency and stability. To achieve these goals, franchisors must establish robust accounting systems that

3 Steps for clean accounting books for Franchisors Read More »

5 Elements for Successful Franchisors Accounting

Franchise, General / Mohamed Metwally, CPA

You set up your franchisor Company, filed your FDD, and ready to start selling? Great, congratulations! Here’s what you need to know about franchisors’ accounting. When it comes to the world of franchising, there are many different aspects to consider in order for both the franchisor and franchisee to be successful. One area

5 Elements for Successful Franchisors Accounting Read More »

2 Steps to Successfully Implement ASC 842 Lease accounting of an office space Rental for small business owners

Franchise, General / Mohamed Metwally, CPA

New Standard You have probably heard about the ASC 842 new lease accounting standard issued by FASB, and you’re probably not sure what it is and how to implement it. If you are a small business owner who only leases an office space, read on, this is for you. The new standard governs how

2 Steps to Successfully Implement ASC 842 Lease accounting of an office space Rental for small business owners Read More »

What is a Franchisor Audit

Articles, Franchise / Mohamed Metwally, CPA

Why you need a financial statements audit? The ultimate goal of all franchisors is to expand their franchise by selling franchises to the prospective franchisee. However, a franchisor must meet FTC requirements and provide annual Franchise Disclosure Documents (FDD) to sell franchises in the United States. The FDD is a disclosure document that contains

What is a Franchisor Audit Read More »

Why is a financial statement important in franchising?

Franchise / Mohamed Metwally, CPA

The ultimate goal of any business is profitability and growth. However, managing a franchise scattered across different locations and with different franchisees, each having unique experiences, can be daunting. Subsequently, it’s possible to lose track of the financial health of the business franchise, which will affect the productivity of your franchise network. Maintaining an up-to-date

Why is a financial statement important in franchising? Read More »

What’s the new franchisor financial statement phase-in process

Franchise / Mohamed Metwally, CPA

The franchise rule set by the federal trade council states that a franchisor looking at selling or offering a franchise must provide a franchise disclosure document (FDD). The FDD contains a series of 23 items that cover different areas of the franchise business. Item 21 is one of the critical sections, and it holds Financials

What’s the new franchisor financial statement phase-in process Read More »

What is Article 21 of the Franchise Disclosure Document?

Franchise / Mohamed Metwally, CPA

The FDD is a document containing 23 items mandated by the Federal Trade Council (FTC) for all franchise owners to provide during the franchise evaluation process. Franchisors must provide a franchise disclosure agreement (FDD) to assist a franchisee in making an investment decision on a franchise business, As part of the requirements, the franchise owners

What is Article 21 of the Franchise Disclosure Document? Read More »

What is a Franchise Audit?

Franchise / Mohamed Metwally, CPA

The success of a franchise business is mainly dependent on the franchisor’s ability to maintain compliance across all franchises. However, franchisees often stray from laid down agreements which pose a risk to the integrity and financial health of the franchise network. As a franchisor, it’s important to arm yourself with a tool to monitor, measure

What is a Franchise Audit? Read More »

What are the Steps to Register a Franchise Disclosure Document?

Franchise / Mohamed Metwally, CPA

As a franchise owner looking at offering a franchise, a franchise disclosure document is a mandatory requirement. Although this process is free at the federal level, franchise registration states require franchisors to register their FDD with the franchise regulator. Asides from the uniform registration requirements, each state on the franchise registration map has additional requirements

What are the Steps to Register a Franchise Disclosure Document? Read More »

What are the FDD Financial Statement Requirements for a Franchise?

Franchise / Mohamed Metwally, CPA

If you want to start a franchise, familiarizing yourself with the FTC rule is essential. The Federal Trade Commission (FTC) requires franchisors to provide financial statements as part of the item 21 Franchise disclosure document at least 14 days before a franchisee signs any agreement. Failure to provide the proper documents attracts strict sanctions as

What are the FDD Financial Statement Requirements for a Franchise? Read More »

Franchisors’ Financial Statements Audit for FDD

Franchise / Mohamed Metwally, CPA

What You Need to Know A financial statement audit appraises the franchise’s financial practices and records to determine its financial health. The franchise financial statement is necessary for FDD registration and renewal. A franchisee also leverages it to evaluate a franchise’s profitability before signing or making any financial commitment. As a Franchisor, it’s essential

Franchisors’ Financial Statements Audit for FDD Read More »

ASC 606 Revenue Recognition For Franchisors

Articles, Franchise / Mohamed Metwally, CPA

What You need to know A challenge in Franchisor accounting is the complex industry-specific guidance for revenue recognition. In response to the challenge, the Financial Accounting Standards Board (FASB) and the International Accounting Standards Board (IASB) developed the Revenue recognition ASC 606 standards. The goal of the new accounting standard is to provide a

ASC 606 Revenue Recognition For Franchisors Read More »