Indicate the errors in, and omission from the draft 20X1 audit report of Ithuta Education Ltd submitted by the junior trainee accountant, describing the appropriate treatment of each error/omission identified. A rewrite of any particular paragraph is not required.

Report of the External Auditor To the board of directors of Ithuta Education Ltd We have audited the financial statements of Ithuta Education Ltd as set out in the annual repori, Which statements comprise the statement of financial position as at 31 December 201, the statement of comprehensive income, the statement of changes in equity and the statement of cash flows for the year then ended. Directors' responsibility for the financial statements The company's directors are responsible for: - the preparation and fair presentation of these financial statements in accordance with International Financial Reporting Standards and the requirements of the Companies Act of South Africa; and - such internal control as the directors deem necessary in order to enable the preparation of financial statements free from material misstatement, whether as a result of fraud or error. The auditor hereby does not accept any responsibility for either the fair presentation of the financial statements or the effectiveness of internal controls. Basis for unqualified opinion As a result of the sufficient appropriate audit evidence obtained, there was no reason to modify the audit opinion. A clean audit report is therefore issued. Unqualified opinion In our opinion, the financial statements present fairly, in all material respects, the financial position of Ithuta Education Ltd as at 31 December 201, as well as its financial performance and cash flows for the year then ended in accordance with International Financial Reporting Standards and the requirements of the Companies Act of South Africa. Emphasis of matter The International Standards on Auditing require us to alert users of the financial statements where any form of non-compliance with laws and regulations have occurred. We hereby emphasise the fact that a reportable irregularity took place, in that the board of directors did knowingly hold back returns from the South African Revenue Service relating to value-added tax in contravention of the Value Added Tax Act 89 of 1991. [Insert auditor's signature here] JDF \& Lovitz Incorporated Registered Auditors Per: S Johnston CA(SA) RA: Director 31 Graceway Blue Hills Crowburgh