What responsibility does the management of Cinch I.T. have regarding internal controls for financial statement preparation?
Cinch_I_T Franchise · 2024 FDDAnswer from 2024 FDD Document
e 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 from material misstatement, whether due to fraud or error.
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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 Cinch Franchise LLC's ability to continue as a going concern within one year after the date that the financial statements are available to be issued.
Auditors' Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors' report that includes our opinion.
Source: Item 23 — RECEIPTS (FDD pages 60–269)
What This Means (2024 FDD)
According to Cinch I.T.'s 2024 Franchise Disclosure Document, management is responsible for the design, implementation, and maintenance of internal controls relevant to the preparation and fair presentation of financial statements. These financial statements should be free from material misstatement, whether due to fraud or error. Management is also responsible for the preparation and fair presentation of the financial statements in accordance with accounting principles generally accepted in the United States of America.
In preparing the financial statements, Cinch I.T.'s management must evaluate whether conditions or events, considered in the aggregate, raise substantial doubt about the company's ability to continue as a going concern within one year after the date that the financial statements are available to be issued.
Furthermore, Cinch I.T.'s management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses during the reporting period. These estimates must conform with accounting principles generally accepted in the United States of America.