On what basis of accounting are the Dog Haus financial statements presented?

According to the 2025 Dog Haus Franchise Disclosure Document, the company's financial statements are prepared in accordance with accounting principles generally accepted in the United States of America (GAAP). Furthermore, the financial statements are presented on the accrual basis of accounting.

This means that Dog Haus recognizes revenues when they are earned and expenses when they are incurred, regardless of when cash changes hands. This method provides a more accurate picture of the company's financial performance over time compared to the cash basis of accounting, which only recognizes revenues and expenses when cash is received or paid.

For a prospective franchisee, understanding the basis of accounting is crucial for interpreting the financial statements provided in the FDD. The accrual basis offers a more comprehensive view of Dog Haus's financial health, allowing franchisees to assess profitability, manage cash flow, and make informed investment decisions. Franchisees should consult with a financial advisor to fully understand the implications of accrual accounting for their investment.