What accounting principles should be followed for the preparation of Churchs Chicken's financial statements?
Churchs_Chicken Franchise · 2025 FDDAnswer from 2025 FDD Document
ended, and the related notes (collectively referred to as the "financial statements").
In our opinion, the accompanying financial statements present fairly, in all material respects, the financial position of the Company at years ended December 29, 2024 and December 31, 2023, and the results of its operations and its cash flows for the years then ended, in accordance with accounting principles generally accepted in the United States of America.
Basis for Opinion
We conducted our audits in accordance with auditing standards generally accepted in the United States of America (GAAS). Our responsibilities under those standards are further described in the Auditor's Responsibilities for the Audit of the Financial Statements section of our report. We are required to be independent of the Company and to meet our other ethical responsibilities in accordance with the relevant ethical requirements relating to our audits. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
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.
Source: Item 11 — FRANCHISOR'S ASSISTANCE, ADVERTISING, COMPUTER SYSTEMS AND TRAINING (FDD pages 35–43)
What This Means (2025 FDD)
According to Churchs Chicken's 2025 Franchise Disclosure Document, the company prepares its consolidated financial statements in accordance with accounting principles generally accepted in the United States of America (U.S. GAAP). This means that Churchs Chicken adheres to a standardized set of guidelines and practices when reporting its financial performance and position. These principles ensure transparency and comparability in financial reporting.
The FDD also mentions that management is responsible for the preparation and fair presentation of the financial statements. This includes the design, implementation, and maintenance of internal controls relevant to the preparation of financial statements that are free from material misstatement, whether due to fraud or error. Management is also required to evaluate whether there are conditions or events 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.
Furthermore, the financial statements of Cajun Global LLC and Subsidiaries, which include Churchs Chicken, are audited by an independent auditor (Ernst & Young LLP). The auditor's role is to express an opinion on whether the financial statements present fairly the company's financial position, results of operations, and cash flows in accordance with U.S. GAAP. This independent audit provides an additional level of assurance to potential investors and franchisees regarding the reliability of the financial information presented.