What is the auditor's responsibility regarding internal controls during the 1 800 Packouts audit?

According to 1 800 Packouts's 2025 Franchise Disclosure Document, the auditor's responsibility regarding internal controls is to gain an understanding of internal control relevant to the audit. This understanding is used to design audit procedures that are appropriate for the given circumstances. However, the audit is not for the purpose of expressing an opinion on the effectiveness of the company's internal control, and the auditor will not express such an opinion.

The auditor's procedures include identifying and assessing the risks of material misstatement of the financial statements, whether due to fraud or error. They design and perform audit procedures responsive to those risks, including examining evidence regarding the amounts and disclosures in the financial statements on a test basis.

The auditor must exercise professional judgment and maintain professional skepticism throughout the audit. Additionally, the auditor must evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the financial statements. The auditor is also required to communicate with those charged with governance regarding the planned scope and timing of the audit, significant audit findings, and certain internal control-related matters identified during the audit.

In summary, while the auditor assesses internal controls to tailor their audit approach, they do not provide an independent opinion on the overall effectiveness of 1 800 Packouts's internal control systems. A prospective franchisee should be aware that the audit's focus is on the financial statements themselves, not on a comprehensive evaluation of the company's internal controls.