identify and explain any five factors which may threaten the independence of your audit firm in auditing financial statement of northen aquamarine for the year ending 31 July 2019

6. Any plagiarized work will be penalized students should use in test citation and referencing) 2 of 4 VARKS: 70 11 Page QUESTION During your company's board meeting held last week, the directors had a stalemate on whether the company should declare a dividend or not. The stalemate was on the whether declaring a dividend or not declaring a dividend You are required to answer the following questions: a State any five possible factors that can influence Dividend Policies [10 marks! Explain the three main types of dividend policies that may be adopted by the company 18 martes] c. Discuss the theory of dividends with specific reference to the Dividend Imelevant Theory and Dividend Relevant Theory Total 25 marks] QUESTION 2 Mr. Shikonpo, a retiree with a farm in Dordabis has received NS1,000,000 in pensions for his long service as a public servant. He is considering investing in farming but does not want to put all eggs in one basket'. Mr Shikongo is, therefore, planning to invest in pig farming crop farming, and floriculture. Likely returns from each investment depend on the state of weather Namibia's Department of Meteorology's weather forecasts for the outlock year we uncertain and are projected as per the table below. The likely returns for each venture, also depending on state of weather, are also given in the table 21 Page 2 Page STATE OF WEATHER BAD GOOD EXCELLENT INVESTMENT PROBABILITY OF STATE OF WEATHER 20% INVESTMENT AND LIKELY RETURNS Pig Farming Crop Farming Floriculture 29 30% 209 NS300.000 159 NS250.000 29% NS450 Required: a Calculate the farmer's likely return on the floriculture investment. [6 marks b. What is the risk of the pig farming project? [6 mars c. What is the farmer's likely combined retum if he invests in the three farming activities as shown in the table! [8 marks) What is the risk on the farmer's portfolio? 15 marks Total 25 marks! Question 3 Giving relevant abstract illustrations, explain how you may use the following to protect the firm's financial interest i Hedging i Futures and forwards Options (10 Marks) Explain the purpose, motive, implementation process and the effect of the following strategies on the firm's value Giving relevant abstract illustrations, explain how you may use the following to protect the firm's financial interests i Hedging i. Futures and forwards in. Options (10 Mark Page Explain the purpose, motive, implementation process and the effect of the following strategies on the firm's value i Stock split Reverse stock split 3 marks cach - 10 marks) Totat 20 Market END OF PAPER