How does Crepe De Licious account for income taxes in its financial statements?

According to the 2025 Crepe De Licious Franchise Disclosure Document, the company addresses income taxes in its financial statements through two methods: current and deferred. For current income taxes, Crepe De Licious provides for income taxes based on the amounts that are reportable for income tax purposes. This means that the company calculates and reports its current tax obligations based on the taxable income and deductions recognized in its tax returns.

In terms of deferred income taxes, Crepe De Licious recognizes that there may be timing differences between when income and expenses are recognized for financial accounting purposes versus income tax purposes. These timing differences result in deferred income taxes, which reflect the future tax consequences of events that have been recognized in the financial statements or tax returns.

In simpler terms, Crepe De Licious accounts for income taxes by considering both its immediate tax obligations and the future tax implications of its financial activities. This approach ensures that the company's financial statements accurately reflect its tax liabilities and assets, providing a more complete picture of its financial position. Prospective franchisees should be aware that these accounting practices are standard and aim to provide a transparent view of the company's financial obligations related to income taxes.