Diamond Ltd operates a chain of food wholesalers and its year end was 31 March 2019. The final audit is nearly coming to an end and it is proposed that the financial statements and audit report will be signed on 13 July 2019. Revenue for the year is 78 million and profit before taxation is 7.5 million. The following events have occurred subsequent to the year end of 31 March 2019: Receivable A major customer of Diamond has been experiencing cash flow problems and its year-end balance is 0.3 million. The company has become aware that this customer is experiencing significant going concern difficulties. Diamond believe that they will receive some, if not full payment from this customer; hence they have not adjusted the receivable balance. Lawsuit A key supplier of Diamond is suing them for breach of contract. The lawsuit was filed prior to the year end and the sum claimed by them is 1 million. This has been disclosed as a contingent liability in the notes to the financial statements; however correspondence has just arrived from the supplier indicating that they are willing to settle the case for a payment by Diaomnd of 0.6 million. It is likely that the company will agree to this. Warehouse Diamond has three warehouses. Following extensive rain on 20 May 2019 one of the warehouses was flooded. All of the inventory was damaged and has been disposed of. The insurance company has already been contacted. No amendments or disclosures have been made in the financial statements. Required: a) For each of the three events above: i) Discuss whether the financial statements require amendment; ii) Describe audit procedures that should be performed in order to form a conclusion on the amendment; and iii) Explain the impact on the audit report should the issue remain unresolved.