What is the purpose of the statement of cash flows in the Crave Franchising, LLC financial statements?
Crave Franchise · 2025 FDDAnswer from 2025 FDD Document
We have audited the accompanying financial statements of Crave Franchising, LLC, (the Company), a Wyoming limited liability company, which comprise Balance sheet as of December 31, 2024, 2023, and 2022, and the related statement of operations and member's equity and cash flows for the year ended December 31, 2024, and the related notes to the financial statements.
In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2024, 2023, and 2022, and the results of its operations and its cash flows for the year ended December 31, 2024, in accordance with accounting principles generally accepted in the United States of America.
Source: Item 23 — RECEIPTS (FDD pages 63–253)
What This Means (2025 FDD)
According to Crave's 2025 Franchise Disclosure Document, the company includes a statement of cash flows as part of its financial statements. This statement, along with the balance sheet, statement of operations and member's equity, and related notes, provides a comprehensive view of Crave's financial performance. The statement of cash flows specifically shows the movement of cash both into and out of the company over a period of time, offering insights into how Crave manages its cash resources.
The independent auditor's report confirms that they audited the cash flows statement along with the other financial statements. Their opinion states that the financial statements, including the statement of cash flows, present fairly the financial position of Crave and its cash flows for the year ended December 31, 2024, in accordance with accounting principles generally accepted in the United States of America.
For a prospective Crave franchisee, the statement of cash flows is a crucial tool for assessing the financial health and stability of the franchisor. It helps in understanding how Crave generates and uses cash, which can be indicative of its ability to support franchisees and manage its own operations effectively. Reviewing this statement, along with the other financial statements and notes, is a standard practice in franchise due diligence to evaluate the financial risks and opportunities associated with investing in a Crave franchise.