What accounting principles must the annual financial statement for Crepe De Licious follow?
Crepe_De_Licious Franchise · 2025 FDDAnswer from 2025 FDD Document
Area Developer shall, at Area Developer's expense, comply with the following requirements to prepare and submit to Franchisor the following reports, financial statements and other data, which shall be prepared in the form and using the standard statements and chart of accounts as Franchisor may prescribe from time to time:
- 5.3.1 No later than the twentieth (20th) day of each calendar month, Area Developer shall have prepared a profit and loss statement reflecting all Area Developer's operations during the last preceding calendar month, for each Restaurant.
Area Developer shall prepare profit and loss statements on an accrual basis and in accordance with generally accepted accounting principles.
Area Developer shall submit such statements to Franchisor at such times as Franchisor may designate or as Franchisor may otherwise request.
5.3.2 On April 15th of the year following the end of Area Developer's fiscal year, a complete annual financial statement (prepared according to generally accepted accounting principles), on a compilation basis, and if required by Franchisor, such statements shall be prepared by an independent certified public accountant.
5.3.3 Such other forms, reports, records, information, and data as Franchisor may reasonably designate.
Maintaining Records.
Area Developer shall maintain during the term of this Agreement, and shall preserve for at least seven (7) years from the dates of their preparation, and shall make available to Franchisor at Franchisor's request and at Area Developer's expense, full, complete, and accurate books, records, and accounts in accordance with generally accepted accounting principles.
Source: Item 22 — CONTRACTS (FDD page 57)
What This Means (2025 FDD)
According to the 2025 Crepe De Licious Franchise Disclosure Document, an Area Developer must adhere to specific financial reporting standards. The profit and loss statements must be prepared on an accrual basis, aligning with generally accepted accounting principles. These monthly statements are due to Crepe De Licious by the 20th day of each calendar month, reflecting operations from the preceding month for each restaurant.
Furthermore, the annual financial statement, which is due on April 15th of the year following the end of the Area Developer's fiscal year, must also be prepared according to generally accepted accounting principles. This annual statement should be compiled, and Crepe De Licious may require it to be prepared by an independent certified public accountant.
In addition to these reports, Area Developers are expected to maintain full, complete, and accurate books, records, and accounts in accordance with generally accepted accounting principles during the term of their agreement. These records must be preserved for at least seven years from their preparation dates and made available to Crepe De Licious upon request, at the Area Developer's expense. This ensures transparency and compliance with Crepe De Licious's financial standards.