What accounting standard does Christian Brothers Automotive apply when accounting for the acquisition of a business?

According to the 2025 Christian Brothers Automotive Franchise Disclosure Document, Christian Brothers Automotive adheres to accounting principles generally accepted in the United States of America when preparing its consolidated financial statements. This is explicitly stated within the Independent Auditors' Report, which confirms that the financial statements present fairly the financial position, results of operations, and cash flows in accordance with these principles.

Specifically, the notes to the consolidated financial statements further elaborate on the application of these accounting principles. When Christian Brothers Automotive acquired 100% ownership of WWK Warranty and Administration LLC in September 2023, and when it acquired a 44% ownership stake in Foedus Sui, LLC in August 2024, the accounting treatment for these acquisitions would have been guided by these generally accepted accounting principles.

For a prospective franchisee, this means that Christian Brothers Automotive maintains its financial records and reports in a manner consistent with standard U.S. accounting practices. This provides a level of transparency and comparability, as these principles are widely understood and used by businesses across the country. Franchisees can be reasonably assured that the financial information provided by Christian Brothers Automotive is prepared using established and recognized methods.