Question
QUESTION 12 Consider the following independent and material situation. In each case: The balance date is 31 st October 2020 The fieldwork was completed on
QUESTION 12
Consider the following independent and material situation. In each case:
The balance date is 31st October 2020
The fieldwork was completed on 5 December 2020
The financial report and audit report were signed on 12 December 2020
The financial report and audit report were mailed to the members on 20 December 2020
Required:
For each of the following independent and material situation, select the appropriate action from the list below, and justify your responses:
Adjust the 31ST October 2020 financial report
Disclose the information in a note at the 31 October 2020 financial report
Request that the client recall the 31ST October 2020 financial report for revision
No action is required.
Your client Kimberly Pty Ltd made an out-of-court settlement on 1 December 2020 of $300,000.00. The settlement is related to a litigation case dating back 4 yearsa provision of $150,000.00 was recorded in the 31 October 2020 financial report.
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