Provide 750 words for the questions below.

QUESTION TWO a) Your audit and assurance firm has just accepted an appointment as the auditor for Rashy Ltd., a restaurant business chain operating at a number of branches in the city of Peterborough. The company deploys a computerised system where all of its Sales Points are networked to its Head Office. For purposes of planning the new audit, your firm has received the draft financial statements for the year and as the audit senior to lead the engagement team, you are examining the financial statements, extracts of which are shown below: Statement of Profit or Loss (Extract) Turnover Cost of Sales Gross Profit Net Profit Statement of Financial Position (Extract) Non-current Assets Other Current Assets Account Receivables Inventories Account Payables Draft 2022 (CAD '000) 16,346 12,912 3,434 1,962 5,598 3,492 3,964 1,291 1,028 Audited 2021 (CAD '000) 11,300 8,596 2,704 1,130 5,232 2,254 2,872 860 920 Required: i) Use analytical procedures at the planning stage to state your observations about the extracts from the draft financial statements and discuss how they may impact on your audit of the Accounts Receivables. (8 marks) ii) Discuss how you will review the opening balances in the draft financial statements of Rashy Ltd. (6 marks) b) As a senior manager in the Quality Control Review department of Trent & Co LLP, you are currently responsible for reviewing the appropriateness of your firm's proposed auditor's reports on the financial statements of Harley Group. The draft financial statements of Harley Group for the year to 31 December 2021 disclose the following notes.