Regarding C12 Group's financial statements, what is affected by management's estimates and assumptions?

According to C12 Group's 2025 Franchise Disclosure Document, the preparation of financial statements requires management to make estimates and assumptions. These estimates and assumptions affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting year.

In simpler terms, when C12 Group prepares its financial statements, the management team must make educated guesses about various financial elements. These estimations influence the value of what C12 Group owns (assets) and owes (liabilities). They also impact how C12 Group reports potential future assets or debts that depend on specific events. Furthermore, these estimates play a role in determining the revenue and expenses C12 Group reports during the year.

The FDD notes that actual results could differ from those estimates. This means that the financial picture presented in C12 Group's statements is based on management's best judgment but might not perfectly reflect reality. Prospective franchisees should understand that these estimates are a standard part of financial reporting, but they introduce an element of uncertainty. It would be prudent for potential franchisees to discuss these accounting policies with C12 Group to fully understand how these estimates are derived and what impact they could have on the overall financial health of the company.