Trudy wishes to buy a national franchise. What information is the seller legally required to provide before she buys the franchise?
The Federal Trade Commission requires the seller of the franchise to provide Trudy with a Franchise Disclosure Document (FDD) at least 14 calendar days before any contract is signed or money is paid. This disclosure statement must provide the following information:
The history of the franchisor and its key executives
Litigation with franchisees
Bankruptcy filings by the company and its officers and directors
Costs to buy and operate a franchise
Restrictions, if any, on suppliers, products, and customers
Territory-any limitations (in either the real or virtual worlds) on where the franchisee can sell or any restrictions on other franchisees selling in the same territory
Business continuity-under what circumstances the franchisor can terminate the franchisee and the franchisee's rights to renew or sell the franchise
Franchisor's training program
Required advertising expenses
A list of current franchisees and those that have left in the prior three years
A report on prior owners of stores that the franchisor has reacquired
Earnings information is not required; but if disclosed, the franchisor must reveal the basis for this information
Audited financials for the franchisor
A sample set of the contracts that a franchisee is expected to sign
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Which of the following procedures is not included in a review engagement of a nonpublic entity?
A. A study and evaluation of internal control. B. Inquiries of management. C. Inquiries regarding significant events subsequent to the balance sheet date. D. Any procedures designed to identify relationships among data that appear to be unusual.
Probing questions are used
a. to finalize a conversation. b. to find out additional information. c. as small talk. d. none of these choices.
Veritas, Inc is planning its annual shareholder meeting on June 15 . The company:
a. need not send notices of the meeting to shareholders since it is the regularly scheduled, annual meeting, which Veritas always holds on the third Thursday of June. b. must send notices to everyone who owns stock as of January 1. c. must send notices to everyone who owns stock on the "record date," which can be no more than 70 days before the meeting. d. is not required to have an annual shareholders meeting if the company is listed only on the NYSE.
Teams go beyond accomplishing goals to achieving synergy.
a. true b. false