What accounting principles must the unaudited annual financial statement of an Angry Chickz franchisee follow?

According to Angry Chickz's 2025 Franchise Disclosure Document, an Angry Chickz franchisee must adhere to generally accepted accounting principles when preparing their unaudited annual financial statement. Specifically, within 120 days following the end of each calendar year (or other fiscal period designated by Angry Chickz), franchisees are required to submit this annual financial statement to Angry Chickz. This statement must be in a form reasonably required by Angry Chickz and certified as accurate and complete by an officer of the franchisee.

This requirement ensures that all franchisees are using a standardized and recognized accounting framework, which allows Angry Chickz to accurately assess the financial health and performance of individual franchise locations and the entire franchise system. Generally accepted accounting principles (GAAP) provide a common set of rules, standards, and procedures for financial reporting. This consistency is crucial for comparative analysis and benchmarking across different franchise units.

For a prospective Angry Chickz franchisee, this means they will need to either have a solid understanding of GAAP or engage a qualified accountant to prepare their financial statements. Failing to comply with this requirement could result in penalties or other enforcement actions from Angry Chickz. It is also important to note that while the annual financial statement is unaudited, Angry Chickz has the right to audit the franchisee's books and records, so maintaining accurate and compliant financial records is essential.