What is the auditor's responsibility regarding internal controls during an audit of Christian Brothers Automotive?

According to Christian Brothers Automotive's 2025 Franchise Disclosure Document, the auditor's responsibility regarding internal control is to obtain an understanding of internal control relevant to the audit. This understanding is used to design audit procedures that are appropriate for the circumstances, but it is explicitly not for the purpose of expressing an opinion on the effectiveness of Christian Brothers Automotive's internal control. The document states that no such opinion is expressed.

In simpler terms, the auditor reviews Christian Brothers Automotive's internal controls to plan the audit effectively. This helps them understand how the company manages its finances and ensures accuracy. However, the auditor's report will not include a statement about whether Christian Brothers Automotive's internal controls are well-designed or working effectively.

This is a standard practice in financial auditing. Auditors need to understand internal controls to assess the risk of material misstatement in the financial statements. However, unless the audit is specifically designed to test internal controls, the auditor does not provide assurance on their effectiveness. For a prospective franchisee, this means the audit focuses on the accuracy of the financial statements, not on the quality of the company's internal control systems.