What internal control-related matters identified during the audit of Dq Treat must be communicated?

According to the 2025 Dq Treat FDD, the company's auditor is required to communicate certain matters to those charged with governance. These matters include the planned scope and timing of the audit, any significant findings discovered during the audit, and specific internal control-related issues that the auditor identifies while conducting the audit.

This communication requirement ensures that key stakeholders are informed about the audit process, its findings, and any weaknesses in Dq Treat's internal controls. However, the auditor's role is not to provide an opinion on the overall effectiveness of Dq Treat's internal control system. Instead, the auditor focuses on understanding the internal controls relevant to the audit to design appropriate audit procedures.

For a prospective Dq Treat franchisee, this indicates that the company undergoes regular financial audits, and any significant issues related to internal controls are communicated to relevant parties. While the FDD excerpt does not detail the specific types of internal control matters that might be communicated, it assures franchisees that financial oversight and transparency are in place at the franchisor level. Franchisees may want to inquire about the types of internal control matters that have been communicated in past audits to gain a better understanding of the company's financial management practices.