(a)[10]
Draw up the revised statement of financial position at 31 December 2016.
(b)[5]
Explain how items 1 and 2 should be shown in the financial statements.
(c)[4]
Explain the function of an external auditor.
(d)[2]
Explain why the audit report of a limited company is sent to the company’s shareholders rather than to its directors.
(e)[4]
Advise the directors whether the inventory valuation method ought to be changed or not. Support your answer with reasons.