Does C12 Group have any recently issued accounting standards that were adopted during 2022?
C12_Group Franchise · 2025 FDDAnswer from 2025 FDD Document
3. Summary of Significant Accounting Policies (Continued)
Recently Issued Accounting Standards
Adopted During 2022
In February 2016, The Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2016-02, Leases, effective for fiscal years beginning after December 15, 2021 and interim periods within fiscal years beginning after December 15, 2022. In 2022, the Company adopted this pronouncement. Under this pronouncement, generally, leases with terms of more than 12 months will be recognized in the Consolidated Balance Sheets as an asset (right to use asset) and a liability (lease liability) (See Note 8).
Source: Item 22 — CONTRACTS (FDD page 46)
What This Means (2025 FDD)
According to the 2025 C12 Group Franchise Disclosure Document, the company adopted a recently issued accounting standard in 2022. Specifically, in February 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2016-02, Leases, which became effective for fiscal years beginning after December 15, 2021, and interim periods within fiscal years beginning after December 15, 2022.
In 2022, C12 Group adopted this pronouncement. As a result, leases with terms longer than 12 months are generally recognized on the Consolidated Balance Sheets as both an asset (right to use asset) and a liability (lease liability). This is further detailed in Note 8 of the financial statements.
For a prospective C12 Group franchisee, this means that any leases the company enters into for longer than 12 months will be accounted for on the balance sheet as both an asset and a liability, impacting the company's financial statements. It is important for franchisees to understand the implications of this accounting standard on their financial reporting and to consult with a financial professional for further guidance.