What accounting standard does ASU 2014-09 supersede for Carbones Pizzeria?
Carbones_Pizzeria Franchise · 2025 FDDAnswer from 2025 FDD Document
| Effective November | 1, 2019, the Company adopted | Accounting | Standards Update (“ASU”) 2014-09 |
|---|---|---|---|
| (Topic 606): Revenue | from Contracts with Customers. | This | ASU supersedes the revenue recognition |
| requirements in Topic | 605 Revenue Recognition (Topic | 605). | The core principle of Topic 606 is that an |
Source: Item 23 — RECEIPTS (FDD pages 30–116)
What This Means (2025 FDD)
According to Carbones Pizzeria's 2025 Franchise Disclosure Document, the company adopted Accounting Standards Update (ASU) 2014-09, (Topic 606): Revenue from Contracts with Customers, effective November 1, 2019. This update changes how Carbones Pizzeria recognizes revenue.
Specifically, ASU 2014-09 supersedes the revenue recognition requirements previously outlined in Topic 605 Revenue Recognition (Topic 605). This means that Carbones Pizzeria, and by extension its franchisees, must now follow the guidelines in Topic 606 for recognizing revenue from customer contracts.
For a prospective Carbones Pizzeria franchisee, this change in accounting standards means they need to be aware of the updated rules for revenue recognition and ensure their accounting practices align with Topic 606. This could involve changes in how sales are recorded and reported, and it's important to understand the implications for financial reporting and tax purposes. Franchisees should consult with their financial advisors to ensure compliance with these updated standards.