How are the consolidated statements of operations and comprehensive income impacted by acquisitions made by Aplus?

According to Aplus's 2024 Franchise Disclosure Document, acquisitions of assets or entities that include inputs and processes and have the ability to create outputs are accounted for as business combinations. A purchase price allocation is recorded for tangible and intangible assets acquired and liabilities assumed based on their fair value. The excess of fair value of consideration conveyed over fair value of net assets acquired is recorded as goodwill.

The consolidated statements of operations and comprehensive income for the periods presented include the results of operations for each acquisition from their respective dates of acquisition. This means that when Aplus acquires another business, the financial performance of that business is included in Aplus's overall financial statements from the date the acquisition is completed.

For a prospective franchisee, this is important because it provides insight into how Aplus grows and manages its business. By reviewing the consolidated statements, a franchisee can see how acquisitions contribute to Aplus's revenue and profitability. However, it's also important to note that acquisitions can introduce complexities and potential risks, such as integrating the acquired business and managing any associated debt or liabilities. Therefore, understanding Aplus's acquisition strategy and its impact on the financial statements is a key part of assessing the overall health and stability of the franchise system.