According to Itan's accounting policies, what is the treatment of basis of accounting?

According to Itan's 2025 Franchise Disclosure Document, the company's financial statements are prepared using the accrual method. This method conforms with generally accepted accounting principles (GAAP) in the United States.

The accrual method means that revenues and expenses are recognized when they are earned or incurred, regardless of when cash changes hands. This provides a more accurate picture of a company's financial performance over a period of time, as it matches revenues with the expenses incurred to generate those revenues.

For a prospective Itan franchisee, understanding the basis of accounting is crucial because it affects how the franchise's financial performance is reported and interpreted. The use of GAAP ensures a standardized approach to financial reporting, making it easier to compare Itan's financial statements with those of other companies and to assess the franchise's profitability and financial health.