Has Pearce Bespoke adopted all recently issued Accounting Standards Updates (ASU)?

According to the 2025 Pearce Bespoke FDD, the company has adopted all recently issued Accounting Standards Updates (ASU). The franchise agreement states that the adoption of these recently issued ASUs, including those not yet effective, is not anticipated to have a material effect on the financial position or results of operations of the company.

Specifically, Pearce Bespoke adopted Accounting Standards Update (ASU) No. 2016-02, Leases, which requires lessees to recognize leases on the balance sheet and disclose key information about leasing arrangements. As a result of implementing ASU No. 2016-02, the Company recognized a right-of use asset and lease liability of $47,474 on its balance sheet as of December 31, 2023. The adoption did not result in a significant effect on amounts reported in the statement of operations and members' equity (deficiency) for the period ended December 31, 2023.

This indicates that Pearce Bespoke is current with accounting standards, which can provide a level of confidence in the financial reporting of the company. For a potential franchisee, this suggests that Pearce Bespoke is transparent and adheres to standard accounting practices. However, the FDD also states that management is responsible for preparing financial statements in accordance with accounting principles generally accepted in the United States of America and for designing, implementing, and maintaining internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.