Does the text specify the accounting standards used to prepare the Checkersrallys financial statements?
Checkersrallys Franchise · 2025 FDDAnswer from 2025 FDD Document
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Adoption of New Accounting Standard
As discussed in Note 2 to the consolidated financial statements, the Company changed its method of accounting for leases in the fiscal year ended January 2, 2023 due to the adoption of ASU No. 2016-02, Leases.
Responsibilities of Management for the Financial Statements
Management is responsible for the preparation and fair presentation of the financial statements in accordance with accounting principles generally accepted in the United States of America, and for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free of material misstatement, whether due to fraud or error.
In preparing the financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the Company's ability to continue as a going concern for one year after the date that the financial statements are available to be issued.
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 91)
What This Means (2025 FDD)
According to Checkersrallys's 2025 Franchise Disclosure Document, the consolidated financial statements are prepared in accordance with accounting principles generally accepted in the United States of America. This is a standard practice, ensuring uniformity and comparability in financial reporting across different companies.
The FDD also mentions that management is responsible for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of consolidated financial statements that are free from material misstatement, whether due to fraud or error. This highlights the importance of accurate and reliable financial reporting within the Checkersrallys organization.
Furthermore, the FDD includes a report from Ernst & Young LLP, an independent auditor, who audited the consolidated financial statements of Checkers Drive-In Restaurants, Inc. and subsidiaries. Their opinion states that the financial statements present fairly, in all material respects, the financial position of the Company in accordance with accounting principles generally accepted in the United States of America. This independent audit provides additional assurance to prospective franchisees regarding the reliability of the financial information presented.