For Beggars Pizza, what was the reason for restating the 2021 financial statements?

According to Beggars Pizza's 2025 Franchise Disclosure Document, the 2021 financial statements were restated due to the company's election to pay the Illinois Pass-Through Entity Tax (PTE Tax) on behalf of its members. The restatement was necessary to accurately reflect this PTE Tax payment of $35,586 as a distribution to the members, rather than as a miscellaneous expense, which was the original reporting method. This change in classification provides a more accurate representation of how the funds were used and distributed within the company.

For a prospective Beggars Pizza franchisee, this restatement indicates a correction in the company's financial reporting practices. It highlights the importance of understanding how pass-through taxes are handled and reported, as it directly impacts the members' equity. The restatement ensures that the financial statements provide a clearer picture of the company's financial position and the distribution of profits to its members.

It is important for potential franchisees to review the restated financial statements and understand the implications of the PTE Tax payment on the company's overall financial health. This includes assessing how the change affects key financial metrics and ratios. Additionally, prospective franchisees should inquire about the company's current tax practices and how they might impact their own financial obligations as franchisees. Understanding these details will help franchisees make informed decisions about their investment and financial planning.