Is the purpose of the audit for C12 Group to express an opinion on the effectiveness of the company's internal control?

According to the 2025 C12 Group Franchise Disclosure Document, the purpose of the audit is not to express an opinion on the effectiveness of the company's internal control. The audit's objective is to obtain reasonable assurance that the financial statements are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes an opinion on the financial statements.

The auditor's responsibilities include identifying and assessing the risks of material misstatement of the financial statements, designing and performing audit procedures responsive to those risks, and evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management. As part of the audit, the auditor obtains an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances.

However, the audit is not performed for the purpose of expressing an opinion on the effectiveness of C12 Group's internal control, and the auditor's report will not include such an opinion. The FDD states that no such opinion is expressed. This means a potential franchisee should not rely on the audit to provide assurance about the quality of C12 Group's internal controls.