What is the significance of 'as restated' next to the 2022 data in the Cool Binz consolidated balance sheets?
Cool_Binz Franchise · 2025 FDDAnswer from 2025 FDD Document
The financial statements for 2022 have been restated to correct an error relating to unidentified impairment of the Delta trade name and franchise agreement intangible assets made in 2022. Retained earnings at the beginning of 2023 have been adjusted for the effects of the restatement on 2022. The following financial statement line items for fiscal year 2022 were affected by the change.
Statement of Operations
Year ended December 31, 2022
Source: Item 23 — RECEIPTS (FDD pages 63–238)
What This Means (2025 FDD)
According to Cool Binz's 2025 Franchise Disclosure Document, the phrase "as restated" next to the 2022 data in the consolidated balance sheets indicates that the company has made corrections to previously reported financial information for that year. Specifically, the 2022 financial statements were adjusted to rectify an error involving the unidentified impairment of the Delta trade name and franchise agreement intangible assets. This means that the initial financial figures released for 2022 were inaccurate and have since been revised.
The restatement directly impacted the retained earnings at the beginning of 2023, as these earnings were adjusted to reflect the changes made to the 2022 figures. The FDD notes that the restatement affected specific line items within the Statement of Operations for the year ended December 31, 2022.
For a prospective Cool Binz franchisee, this restatement highlights the importance of carefully reviewing the financial statements and understanding the reasons behind any adjustments. It is essential to inquire about the specific nature and impact of the restatement to fully assess the company's financial performance and stability. While restatements are not uncommon, they warrant careful scrutiny to ensure transparency and accuracy in financial reporting.