What is the auditor's responsibility regarding internal control when auditing Aira Fitness?
Aira_Fitness Franchise · 2025 FDDAnswer from 2025 FDD Document
- Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control. Accordingly, no such opinion is expressed.
- 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.
- Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about the Company's ability to continue as a going concern for a reasonable period of time.
We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control related matters that we identified during the audit.
Source: Item 23 — **RECEIPTS (FDD pages 59–254)
What This Means (2025 FDD)
According to Aira Fitness's 2025 Franchise Disclosure Document, the auditor's responsibility regarding internal control is to gain an understanding of it relevant to the audit. This understanding is used to design audit procedures that are appropriate for the circumstances, but it is explicitly stated that the purpose is not to express an opinion on the effectiveness of Aira Fitness's internal control. Therefore, the auditor does not express any opinion on the effectiveness of the company's internal control.
The audit procedures are designed to identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error. The procedures include examining evidence regarding the amounts and disclosures in the financial statements on a test basis.
The auditor is also responsible for evaluating the appropriateness of the accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. Additionally, the auditor must conclude whether there are conditions or events that raise substantial doubt about Aira Fitness's ability to continue as a going concern for a reasonable period of time.
Finally, the auditor is 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.