What does the auditor evaluate regarding the appropriateness of accounting policies used by iTan?
Itan Franchise · 2025 FDDAnswer from 2025 FDD Document
In performing an audit in accordance with generally accepted auditing standards, we:
- Exercise professional judgment and maintain professional skepticism throughout the audit.
- Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.
- Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of iTan Franchising, Inc.'s internal control. Accordingly, no such opinion is expressed.
- Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of financial statements.
- Conclude whether, in our judgment, there are conditions or events, considered in the aggregate that raise substantial doubt about iTan Franchising, Inc.'s ability to continue as a going concern for a reasonable period of time.
Source: Item 23 — RECEIPT (FDD pages 44–190)
What This Means (2025 FDD)
According to iTan's 2025 Franchise Disclosure Document, the auditor evaluates the appropriateness of the accounting policies used by iTan Franchising, Inc. This evaluation is part of a broader audit conducted in accordance with generally accepted auditing standards. The auditor's objective is to obtain reasonable assurance that the financial statements are free from material misstatement, whether due to fraud or error.
In addition to assessing accounting policies, the auditor also evaluates the reasonableness of significant accounting estimates made by management and the overall presentation of the financial statements. This involves exercising professional judgment and maintaining professional skepticism throughout the audit process. The auditor identifies and assesses the risks of material misstatement, designing audit procedures responsive to those risks, and examining evidence regarding the amounts and disclosures in the financial statements on a test basis.
The auditor also obtains an understanding of internal control relevant to the audit to design appropriate procedures, though they do not express an opinion on the effectiveness of iTan's internal control. Furthermore, the auditor concludes whether there are conditions or events that raise substantial doubt about iTan's ability to continue as a going concern for a reasonable period of time. These evaluations provide a comprehensive assessment of the financial health and reporting practices of iTan Franchising, Inc.