What responsibility does the management of Bw Premier Collection have regarding internal controls for financial statement preparation?
Bw_Premier_Collection Franchise · 2025 FDDAnswer from 2025 FDD Document
bilities of Management for the Financial Statements
Management is responsible for the preparation and fair presentation of the financial statements in accordance with accounting principles generally accepted in the United States of America, and for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free of material misstatement, whether due to fraud or error.
In preparing the financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the Company's ability to continue as a going concern for one year after the date that the financial statements are available to be issued.
Auditor's Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free of material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with GAAS will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the financial statements.
In performing an audit in accordance with GAAS, we:
- Exercise professional judgment and maintain professional skepticism throughout the audit.
Source: Item 23 — Receipts (FDD pages 54–203)
What This Means (2025 FDD)
According to Bw Premier Collection's 2025 Franchise Disclosure Document, management is responsible for the design, implementation, and maintenance of internal controls relevant to the preparation and fair presentation of the company's financial statements. This includes ensuring that the financial statements are free from material misstatements, whether due to fraud or error, and are presented fairly in accordance with accounting principles generally accepted in the United States of America.
In preparing the financial statements, Bw Premier Collection's management must evaluate whether there are conditions or events that raise substantial doubt about the company's ability to continue as a going concern for one year after the date that the financial statements are available to be issued. This assessment is a critical part of ensuring the accuracy and reliability of the financial reporting.
The independent auditor's role is to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to fraud or error, and to issue an auditor's report that includes their opinion. However, the auditor does not express an opinion on the effectiveness of the company's internal control. The auditor's responsibilities include obtaining an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances.