3. Extract of the most recent annual reports for Elm itd are given below: Elm Itd Income Statement Extract for the year end 31 December 2019 Operating profit Finance cost Profit before taxation Taxation Profit after tax '000 840 (44) 796 (120) 676 Elm Itd Statements of Financial Position as at 31 December 2019 '000 E'000 2018 E'000 '000 5,900 700 4,300 600 Non current assets: Property, plant and equipment Development Current assets: Inventory Trade receivables Cash and bank balance 420 390 230 160 150 470 1040 7640 780 5.680 Equity and reserves: Ordinary shares of 1 each Share premium account Retained earnings 4,490 600 880 3,080 320 730 5,970 4,130 Non current liabilities: 8 % Loan Notes Lease Liabilities Provisions Deferred tax 410 340 230 90 400 290 210 70 1,070 970 Current liabilities: Trade payable Taxation Lease Liabilities Interest payable 160 310 100 30 190 280 70 40 600 7.640 580 5.680 You are informed as follows: a) Disposal of equipment with a carrying value of 570,000 generated a profit of 75,000, which was included within operating profit. Depreciation of property, plant and equipment for the year was 110,000. b) Elm purchased 150,000 of equipment on a lease creating an asset and liability for this amount. Elm also spent 140,000 on new product development during 2019. c) The 8% loan note was reported using amortised cost, with a finance cost of 32,000 for the year. The finance cost for the finance lease was 12,000 for the year. d) Elm created a new provision of 48,000 during the year. e) Elm paid a single dividend prior to the year finishing. Required: a) Prepare a Statement of Cash Flow for the year ended 31 December 2019 using the format stated in IAS 7 Statement of cash flow. (20 marks) b) Produce an analysis of the key issues identified by the Cash Flow Statement produced for Elm