Exhibit $4$ Notes from discussion with Group audit committee and finance director.

Recent publicity

During the year, the Group attracted negative publicity when an investigation by a well$-$known

journalist alleged that child labour was being used by several suppliers of raw materials to

Lynott Co$.$ The Group refuted the allegations, claiming that the suppliers in question had no

contract to supply Lynott Co$,$ and that the Group always uses raw materials from ethically

responsible suppliers. The media coverage of the issue has now ended. The Group finance

director is confident that the negative publicity has not affected sales of the Group$$s products,

saying that in fact sales are buoyant, as indicated by the increase in Group revenue in the year.

Systems and accounting policies

The Group has a policy of non$-$amortisation of the Browns brand name. The brand name was

acquired many years ago and is recognised at its original cost. The previous audit firm accepted

the policy due to the strength of the brand name and the fact that the Group spends a significant

amount each year on product development and marketing aimed at supporting the brand. The

Group has maintained a good market share in the last few years and management is confident

that this will continue to be the case.

As part of management$$s strategy to increase market share, a bonus scheme has been put in

place across the Group under which senior managers will receive a bonus based on an increase

in revenue.

The Group$$s accounting and management information systems are out of date, and the Group

would like to develop and implement new systems next year. The audit committee would like

to obtain advice from Barnes & Barnett Co on the new systems as they have little specialist in

house knowledge in this area.

Financing

In addition, the audit committee requests that the Group audit engagement partner attends a

meeting with the Group$$s bank, which is planned to be held the week after the auditor$$s report

is issued. The purpose of the meeting is for the Group to renegotiate its existing lending facility

and to extend its loan, and will be attended by the Group financed director, a representative of

the audit committee, as well as the bank manager. The Group is hoping that the audit partner

will be able to confirm the Group$$s strong financial position at the meeting, and also confirm

that the audit included procedures on going concern, specifically the audit of the Group$$s cash

flow forecast for the next two years, which the bank has requested as part of their lending decision $($d$)$ Using the information provided in the meeting notes in Exhibit $4,$ identify and evaluate any ethical

threats and other professional issues which arise from the requests made by the Group audit committee. $(8$

marks$)$