What accounting standards are used to prepare the Deer Solution Statement of Cash Flows?
Deer_Solution Franchise · 2025 FDDAnswer from 2025 FDD Document
This summary of significant accounting policies is presented to assist the reader in understanding and evaluating the Company's financial statements. The financial statements and notes are representations of the Company's management, which is responsible for their integrity and objectivity. These accounting policies conform to generally accepted accounting principles and have been consistently applied in the preparation of financial statements.
A. Basis of Accounting
The Company's financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America ("GAAP").
B. Cash and Cash Equivalents
For purposes of the Statement of Cash Flows, cash equivalents include bank accounts and cash in transit for bank deposit with maturities of three months or less to be cash equivalents.
Source: Item 23 — RECEIPTS (FDD pages 55–246)
What This Means (2025 FDD)
According to Deer Solution's 2025 Franchise Disclosure Document, the company's financial statements, including the Statement of Cash Flows, are prepared in conformity with accounting principles generally accepted in the United States of America ("GAAP"). This indicates that Deer Solution adheres to a standardized set of accounting rules and guidelines when presenting its financial information.
For a prospective franchisee, this means that Deer Solution's financial statements are prepared using a consistent and widely recognized framework, making it easier to compare their financials with other companies and assess their financial health. GAAP provides a level of assurance that the financial information is presented fairly and transparently.
Furthermore, the document specifies that for the purposes of the Statement of Cash Flows, cash equivalents include bank accounts and cash in transit for bank deposits with maturities of three months or less. This definition is important because it clarifies what Deer Solution considers to be equivalent to cash when reporting its cash flows, which can impact how its financial performance is perceived.
In addition, the financial statements and related notes are the responsibility and representation of Deer Solution's management. An independent auditor then audits these statements to provide an opinion on whether they fairly present the company's financial position in accordance with GAAP. This audit adds another layer of credibility to the financial statements, assuring potential franchisees that the information has been reviewed by an independent expert.