What does the auditor's opinion state about the fairness of Desi District's financial position?
Desi_District Franchise · 2024 FDDAnswer from 2024 FDD Document
To the Management of DESI DISTRICT FRANCHISE GROUP, LLC
Opinion
We have audited the financial statements of DESI DISTRICT FRANCHISE GROUP, LLC (the "Company"), which comprise the Balance Sheet as of June 15, 2024, and the related notes for the period then ended. (collectively referred to as the "financial statements").
In our opinion, the accompanying financial statements present fairly, in all material respects, the financial position of the Company at June 15, 2024, and the results of its operations and its cash flows for the period ended June 15, 2024, in accordance with accounting principles generally accepted in the United States of America.
Basis for Opinion
We conducted our audit in accordance with auditing standards generally accepted in the United States of America (GAAS). Our responsibilities under those standards are further described in the Auditor's Responsibilities for the Audit of the Financial Statements section of our report. We are required to be independent of the Company and to meet our other ethical responsibilities in accordance with the relevant ethical requirements relating to our audits. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
Responsibilities of Management for the Financial Statements
Management is responsible for the preparation and fair presentation of the financial statements in accordance with accounting principles generally accepted in the United States of America, and for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free of material misstatement, whether due to fraud or error.
In preparing the financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the Company's ability to continue as a going concern for one year after the date that the financial statements are available to be issued.
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 52)
What This Means (2024 FDD)
According to Desi District's 2024 Franchise Disclosure Document, the auditor's opinion states that the financial statements of DESI DISTRICT FRANCHISE GROUP, LLC present fairly, in all material respects, the financial position of the Company as of June 15, 2024, and the results of its operations and its cash flows for the period then ended. This opinion is in accordance with accounting principles generally accepted in the United States of America.
This "fair presentation" opinion from an independent auditor is a standard and important element of financial statement audits. It means the auditor believes Desi District's financial statements are presented accurately and in compliance with established accounting standards. This gives potential investors and franchisees confidence that the financial information is reliable and can be used to make informed decisions.
The audit was conducted following generally accepted auditing standards in the United States of America (GAAS). The auditor's responsibilities under GAAS include being independent, meeting ethical requirements, and obtaining sufficient audit evidence to support their opinion. Management is responsible for preparing the financial statements, maintaining internal controls, and evaluating the company's ability to continue as a going concern. The auditor's report includes their opinion on the financial statements and addresses their responsibilities during the audit.
Prospective franchisees should review the full audited financial statements and the accompanying notes, along with the auditor's report, to gain a comprehensive understanding of Desi District's financial condition. Understanding the auditor's opinion in the context of the complete financial picture is crucial for assessing the financial health and stability of the franchise system.