Does the auditor express an opinion on the effectiveness of Deck Medic's internal control?
Deck_Medic Franchise · 2024 FDDAnswer from 2024 FDD Document
if there is a substantial likelihood that, individually or in aggregate, they would influence the judgment made by a reasonable user based on the financial statements.
In performing an audit in accordance with generally accepted auditing standards, we:
- Exercise professional judgment and maintain professional skepticism throughout the audit.
- Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or\nerror, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.
Source: Item 23 — RECEIPTS (FDD pages 43–228)
What This Means (2024 FDD)
According to Deck Medic's 2024 Franchise Disclosure Document, the independent auditor does not express an opinion on the effectiveness of Deck Medic's internal control. While the auditor obtains an understanding of internal control relevant to the audit to design appropriate audit procedures, this understanding is not for the purpose of expressing an opinion on the effectiveness of Deck Medic's internal control.
This means that the audit focuses on whether the financial statements are fairly presented, but it does not assess how well Deck Medic's internal controls prevent errors or fraud. A prospective franchisee should understand that the financial statements have been audited for accuracy, but the audit does not provide assurance about the strength of Deck Medic's internal processes.
This is a fairly standard practice in franchise FDD audits. Franchisees who want to know more about the Deck Medic's internal controls can ask the franchisor directly. However, Deck Medic is not obligated to disclose this information.