What is management responsible for regarding internal control related to financial statements for Aw?

According to Aw's 2025 Franchise Disclosure Document, management is responsible for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. This means Aw's management must establish and maintain systems and procedures to ensure the accuracy and reliability of the company's financial reporting.

This responsibility includes creating a control environment, assessing risks, implementing control activities, ensuring information and communication systems are effective, and monitoring these controls. The goal is to prevent and detect errors or fraud that could materially misstate the financial statements.

For a prospective Aw franchisee, this indicates that the franchisor has a defined responsibility to ensure accurate financial reporting. While the auditor does not express an opinion on the effectiveness of internal controls, the management team is still responsible for these controls. This can give franchisees some assurance that the franchisor's financial statements are prepared with due diligence and in accordance with accounting principles.

It is important to note that while management is responsible for internal controls, an audit provides reasonable assurance, but not absolute assurance, that the financial statements are free from material misstatement. The auditor's role is to assess the risks of material misstatement and design audit procedures accordingly, but this does not relieve management of its responsibilities for internal control.