When preparing consolidated financial statements for Gold Star, what accounting principles must be followed?
Gold_Star Franchise · 2025 FDDAnswer from 2025 FDD Document
Management is responsible for the preparation and fair presentation of these consolidated financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the consolidated financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about Gold Star Chili, Inc., its subsidiary, TCWW, LLC and its consolidated entity, GCS Properties, LLC's ability to continue as a going concern within one year after the date that the consolidated financial statements are available to be issued.
Source: Item 23 — Receipts (FDD pages 53–163)
What This Means (2025 FDD)
According to Gold Star's 2025 Franchise Disclosure Document, the consolidated financial statements must adhere to accounting principles generally accepted in the United States of America (U.S. GAAP). This means that Gold Star's management is responsible for preparing and fairly presenting these statements, including designing, implementing, and maintaining internal controls to ensure the statements are free from material misstatement, whether due to fraud or error.
Management must also evaluate whether there are conditions or events that raise substantial doubt about Gold Star Chili, Inc., its subsidiary TCWW, LLC, and its consolidated entity, GSC Properties, LLC's ability to continue as a going concern within one year after the date that the consolidated financial statements are available to be issued. This evaluation is a critical part of ensuring the financial statements provide an accurate and reliable picture of the company's financial health.
Furthermore, the independent auditor's report included in the FDD states that the audit was conducted in accordance with auditing standards generally accepted in the United States of America. The auditor's opinion confirms that the consolidated financial statements present fairly, in all material respects, the financial position, results of operations, and cash flows of Gold Star and its entities in accordance with U.S. GAAP.