Described below are situations which have arisen at four unrelated clients of your firm. The year end in each case is 31 December 2023. Kilongola Ltd (Kilongola) Your firm is the external auditor of Kilongola. Your firm attended the inventory count at Kilongola'swarehouse on 31 December 2023, but was unaware that Kilongola also owned inventory held at a third party'spremises on this date. Neither Kilongola nor the third party has retained any count records in respect of this inventory. Your firm has concluded that there are no other records from which the amount of inventory held by the third party can be substantiated. Kilongola'sdirectors wish to include the inventory held at the third party'spremises in the year-end financial statements at TZS.1,375,000,000. The draft financial statements showthat Kilongola'sprofit before tax is TZS.13,000,000,000 and total assets are TZS.54,250,000,000. Mlingi Ltd (Mlingi) Your firm is the external auditor of Mlingi. A competitor has alleged that Mlingi has infringed patent rights and the competitor is threatening to claim damages of TZS.12,500,000,000. Mlingi's@ MOSHI CO-OPERATIVE UNIVERSITY 2024 7