Section 16-37-3 - General filing requirements(a) Subfranchisor offering circular. When a person filing an offering circular is a subfranchisor, the circular shall also include the same information concerning the subfranchisor as is required from the franchisor.(b) Financial statements. (1) Financial statements required to be filed in connection with an offering circular shall be prepared in accordance with generally accepted accounting principles. Such financial statements shall be audited and certified by a certified public accountant, except where the particular form or this section permits the use of unaudited statements.(2) A balance sheet of the franchisor at the close of the franchisor's last fiscal year preceding the date of filing of the offering circular and a profit and loss statement and analysis of surplus for the fiscal year ended at the date of the balance sheet, together with a balance sheet of the franchisor as of a date within ninety days prior to the date of filing of the offering circular and a statement of profit and loss for the period from the close of the last preceding fiscal year to the date of the balance sheet, both verified by a duly authorized officer of the franchisor, if the franchisor has been in existence for less than one year, a balance sheet of the franchisor as of a date within ninety days prior to the date of filing and a statement of profit and loss for the period from the franchisor's organization to the date of the balance sheet shall be filed together with the offering circular.(3) Where a franchisor owns directly or indirectly a majority interest of the outstanding voting securities of any other corporation, the financial statements required to be filed shall normally reflect on a consolidated basis the financial condition of the franchisor and all of such subsidiaries.(4) In certain cases the director may waive the requirement for audited statements if the statements have been prepared by an independent certified public accountant or independent public accountant and the director is otherwise satisfied as to the reliability of such statements and as to the ability of the franchisor to perform future commitments. Such waiver shall ordinarily be granted only upon a showing that the franchisor has not had prior audited statements; that the close of the most recent or current fiscal year is so near the time of filing of the offering circular that it would be unreasonably costly or impractical to provide audited statements with the application; and that audited statements will be furnished within a reasonable time after the end of the most recent or current fiscal year. In such cases the director may impose an impoundment and such other conditions and restrictions as in his discretion may be appropriate. In every case where an unaudited statement is to be filed, the person requesting approval shall submit to the director, in writing, his reasons therefore and obtain the prior written approval of the director.(5) The use of unaudited financial statements as provided herein shall not relieve the applicant or any person from any liability for false and misleading statements contained in such financial statements.(c) Amendment of offering circular. Any amendment to the text of the offering circular, or of any item, exhibit, or other documents previously filed as a part of the offering circular shall be indicated by underscoring new material and bracketing material to be deleted.[Eff. 1/1/75; am 3/30/79; am and ren § 16-37-3, 7/30/81] (Auth: HRS § 482E-8) (Imp: HRS § 482E-3)