What is the auditor's responsibility regarding significant audit findings for Apricot Lane?

According to the 2025 Apricot Lane FDD, the auditor is required to communicate with those charged with governance regarding the planned scope and timing of the audit. This communication extends to significant audit findings and certain internal control-related matters identified during the audit. This means that the auditor must inform the relevant parties about the audit's plan, any major issues discovered, and any problems related to internal controls.

For a prospective Apricot Lane franchisee, this indicates that the financial statements have been reviewed by an independent auditor, and any significant issues found during the audit will be communicated to those in charge of governance. This provides a level of assurance that potential financial discrepancies or internal control weaknesses are brought to the attention of the appropriate individuals.

It is important to note that the auditor's responsibility is to report these findings to those charged with governance, which may include the board of directors or other governing bodies. The auditor's report does not detail who those charged with governance are. The franchisee should be aware that the auditor's report offers an opinion on the financial statements' fairness but does not guarantee the complete absence of misstatements.