Explain what you expect GCs management to do relative to the accounts in this circumstance. Mr Bamboozle has been asking Mr Mahdi daily when he might be ready to sign the audit report. As the accounts seem to be in order, Mr Mahdi is putting pressure on you to finish the working papers and hand them to him so that he can sign off the audit. You note that the Final Accounts as submitted to you by Mr Bamboozle do not mention the post balance date event, and draft the audit report accordingly then finish tidying up, and prepare to give the working papers and draft report to Mr Mahdi tomorrow. As it is late you decide to drop by a local restaurant on the way home. While eating your meal you are joined by a local person whom you know was recently released from jail following his conviction for assault. This person explains that GCs accounts are not going to mention the loss due to the fire, and perhaps the audit report should not mention this loss either.

(a) Write a detailed report to Mr Mahdi explaining what type of audit report he should give.

(b) Discuss the ethical implications of your evening meal.