(Continued) Matter 4:

Supporting Facts:

Could Cooper & Co make a defence of contributory negligence?

Explain your answer with reference the facts above.

You are auditing the account of Cooper & Co for the year ended 30 June 2021. On the 28th of June Cooper & Co signed a contract for the part sale of some land they owned and received a 25% deposit. The balance was payable when the land subdivision was approved by the local council. The client recorded the deposit through its sales figure in its financial report, with no adjustment to Property, Plant and Equipment, and no mention of the balance owing. The auditor did not discover the land sale or its treatment by Cooper & Co, and issued an audit report with an unmodified opinion. As a result of the treatment Cooper & Co appeared to be in compliance with their banking compliance requirements and borrowed further funding. The bank has now demanded immediate repayment of these funds as Cooper & Co are actually in breach of its banking compliance requirements when the appropriate accounting treatment is applied. Cooper & Co are now looking to sue you for negligence. Outline the four (4) matters they must prove to establish negligence on your part, including how they would apply those to the facts. (8 Marks) Matter 1: Supporting Facts: Matter 2: Supporting Facts: Matter 3: Supporting Facts