Are the financial statements in Exhibit K for Dq Treat consolidated?
Dq_Treat Franchise · 2025 FDDAnswer from 2025 FDD Document
The following audited financial statements of IDQ are included in this disclosure document as Exhibit K: consolidated balance sheets of IDQ at December 31, 2024 and 2023 and related consolidated statements of income and comprehensive income, stockholder's equity and cash flows for each of the years ended December 31, 2024, 2023 and 2022, together with the independent auditor's report.
These financial statements are the consolidated financial statements of IDQ, the parent corporation of ADQ and its other subsidiaries. ADQ's separate financial statements are not included in this disclosure document. Should ADQ fail to fulfill its obligations to its franchisees, however, IDQ unconditionally guarantees to fulfill such obligations. A copy of IDQ's written Guarantee of Performance is included in Exhibit K.
Source: Item 21 — UItem 21U***:** U**Financial Statements (FDD page 67)
What This Means (2025 FDD)
According to Dq Treat's 2025 Franchise Disclosure Document, the financial statements in Exhibit K are consolidated. Specifically, the exhibit includes the consolidated balance sheets of IDQ (International Dairy Queen, Inc.) at December 31, 2024, and 2023, along with related consolidated statements of income, comprehensive income, stockholder's equity, and cash flows for the years ending December 31, 2024, 2023, and 2022. These statements are accompanied by an independent auditor's report.
These financial statements represent the consolidated financial position and results of operations for IDQ, which is the parent corporation of ADQ (American Dairy Queen Corporation) and its other subsidiaries. The FDD clarifies that separate financial statements for ADQ are not included in the document. However, IDQ provides an unconditional guarantee to fulfill ADQ's obligations to its franchisees, should ADQ fail to do so. This guarantee is also included in Exhibit K.
The consolidated financial statements are prepared in accordance with generally accepted accounting principles (GAAP) in the United States of America. They include the accounts of Dq Treat and its affiliates, with all significant intercompany balances and transactions eliminated. This approach provides a comprehensive view of the financial health and performance of the entire Dq Treat organization, which can be valuable for prospective franchisees assessing the stability and reliability of the franchise system.