What is the auditor's responsibility regarding Bambu Franchising, LLC's internal control during the audit?

According to Bambu's 2025 Franchise Disclosure Document, the auditor's responsibility regarding internal control is to obtain an understanding of internal control relevant to the audit. This understanding is used to design audit procedures that are appropriate for the circumstances, but it is explicitly not for the purpose of expressing an opinion on the effectiveness of Bambu Franchising, LLC's internal control. Therefore, the auditor's report will not include an opinion on the effectiveness of Bambu's internal controls.

This means that while the auditor will assess Bambu's internal controls to plan the audit, they are not providing any assurance to a potential franchisee that those controls are effective. A prospective franchisee should not rely on the auditor's report as an indication of the strength or weakness of Bambu's internal controls.

It is important for potential franchisees to understand the limitations of an audit. The audit is designed to provide reasonable assurance that the financial statements are free from material misstatement, but it is not a guarantee. The auditor's focus on internal control is limited to what is necessary to plan the audit, not to evaluate the overall effectiveness of the company's internal control system. Bambu's management is responsible for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements.