What is the auditor required to evaluate regarding accounting policies used by C12 Group?

According to the 2025 FDD, the auditor is required to evaluate the appropriateness of the accounting policies used by C12 Group. This evaluation is part of a broader audit process aimed at providing reasonable assurance that the financial statements are free from material misstatement, whether due to fraud or error. The auditor's responsibilities also include assessing the reasonableness of significant accounting estimates made by management and evaluating the overall presentation of the financial statements.

This requirement ensures that C12 Group's financial reporting adheres to generally accepted accounting principles. By evaluating the appropriateness of accounting policies, the auditor verifies that the methods used to recognize and measure financial transactions and balances are suitable and consistently applied. This helps maintain the integrity and reliability of the financial statements, providing stakeholders with confidence in the reported financial information.

For a prospective C12 Group franchisee, this aspect of the audit provides assurance that the franchisor's financial statements are prepared using sound and appropriate accounting practices. This can be particularly important when assessing the financial stability and performance of the franchisor, which can influence the franchisee's decision to invest in the franchise. The auditor's evaluation contributes to the overall transparency and credibility of C12 Group's financial reporting.