What was the reported amount for accrued income taxes for Carbones Pizzeria?
Carbones_Pizzeria Franchise · 2025 FDDAnswer from 2025 FDD Document
M&T, C&S and CPI are corporations and provide for income taxes based on income reported for financial reporting purposes. Certain revenue and charges to earnings differ as to timing from those deducted for tax purposes; these relate primarily to allowances for doubtful receivables, accrued liabilities, depreciation, and net operating loss carryforwards. The tax effects of these differences are recorded as deferred income taxes.
The Company's policy is to evaluate the likelihood that its uncertain tax positions will prevail upon examination based on the extent to which those positions have substantial support within the IRC and Regulations, Revenue Rulings, court decisions, and other evidence. The federal and state income tax returns of the Company are subject to examination by the income taxing authorities, generally for three years after they were filed. Interest and penalties, if any, assessed by income taxing authorities, will be recorded in operating expenses.
In preparing consolidated financial statements in conformity with accounting principles generally accepted in the United States of America ("US GAAP"), management makes estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the consolidated financial statements, as well as the reported amounts of revenues and expenses during the reporting period. Significant estimates made by the Company are made by the Company the allowance for doubtful accounts and the tax valuation allowance. Actual results could differ from those estimates.
Source: Item 22 — CONTRACTS (FDD page 30)
What This Means (2025 FDD)
The 2025 Franchise Disclosure Document does not explicitly state the amount of accrued income taxes for Carbones Pizzeria. However, the document does discuss how the company handles income taxes. Specifically, it mentions that M&T, C&S, and CPI are corporations that account for income taxes based on income reported for financial reporting purposes. The document also notes that differences in revenue and charges to earnings are recorded as deferred income taxes.
Additionally, the FDD states that the company's policy is to evaluate the likelihood of uncertain tax positions prevailing upon examination. Interest and penalties assessed by income taxing authorities are recorded in operating expenses. The document also mentions that the company uses estimates and assumptions that affect the reported amounts of assets and liabilities, including items like allowances for doubtful accounts and tax valuation allowances.
Because the FDD does not provide a specific figure for accrued income taxes, prospective franchisees should consider asking Carbones Pizzeria's franchisor for this information. Understanding the company's tax liabilities and how they are managed can be an important part of assessing the financial health of the franchise system.