According to Benihana, what is the responsibility of their management regarding internal control?
Benihana Franchise · 2024 FDDAnswer from 2024 FDD Document
Our management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act. Internal control over financial reporting is a process to provide reasonable assurance regarding the reliability of our financial reporting for external purposes in accordance with accounting principles generally accepted in the United States of America. Internal control over financial reporting includes maintaining records that in reasonable detail accurately and fairly reflect our transactions; providing reasonable assurance that transactions are recorded as necessary for preparation of our financial statements; providing reasonable assurance that receipts and expenditures are made in accordance with management authorization; and providing reasonable assurance that unauthorized acquisition, use or disposition of company assets that could have a material effect on our financial statements would be prevented or detected on a timely basis. Because of its inherent limitations, internal control over financial reporting is not intended to provide absolute assurance that a misstatement of our financial statements would be prevented or detected.
Our management has assessed the effectiveness of our internal control over financial reporting as of December 31, 2023. In making its assessment of internal control over financial reporting, management used the criteria set forth by the Committee of Sponsoring Organizations (the "COSO") of the Treadway Commission in Internal Control – Integrated Framework (2013). Based on this assessment, our CEO and CFO concluded that our internal control over financial reporting was effective as of December 31, 2023.
Deloitte & Touche LLP, the independent registered public accounting firm that audited the financial statements included in this Annual Report, has issued an attestation report on our internal control over financial reporting as of December 31, 2023.
Changes in Internal Control Over Financial Reporting
There have been no changes in our internal control over financial reporting that occurred during the quarter ended December 31, 2023 that have materially affected, or are reasonably likely to materially affect, the Company's internal control over financial reporting.
Source: Item 22 — CONTRACTS (FDD pages 73–74)
What This Means (2024 FDD)
According to Benihana's 2024 Franchise Disclosure Document, management is responsible for establishing and maintaining adequate internal control over financial reporting. This control is defined by Rules 13a-15(f) and 15d-15(f) under the Exchange Act. The purpose of this internal control is to provide reasonable assurance that the company's financial reporting is reliable for external purposes, adhering to the accounting principles generally accepted in the United States of America.
Benihana's internal control over financial reporting includes several key functions. It involves maintaining detailed and accurate records of the company's transactions, ensuring that these transactions are recorded appropriately for the preparation of financial statements. It also provides reasonable assurance that all receipts and expenditures are made with management authorization. Furthermore, it aims to prevent or detect any unauthorized acquisition, use, or disposition of company assets that could significantly impact the financial statements.
However, Benihana notes that internal control over financial reporting has inherent limitations. It is not designed to provide absolute assurance that all misstatements in the financial statements will be prevented or detected. Benihana's management has assessed the effectiveness of their internal control over financial reporting as of December 31, 2023, using criteria set forth by the Committee of Sponsoring Organizations (COSO) of the Treadway Commission in Internal Control – Integrated Framework (2013). Based on this assessment, the CEO and CFO have concluded that the internal control over financial reporting was effective as of the same date. Deloitte & Touche LLP, the independent registered public accounting firm, has also issued an attestation report on the company's internal control over financial reporting as of December 31, 2023.
Additionally, the document states that there have been no changes in internal control over financial reporting during the quarter ended December 31, 2023, that have materially affected, or are reasonably likely to materially affect, the company's internal control over financial reporting.