Question 2 Audit Reports 15 Marks Te Mata is a small and medium winery located in New Zealand. You have been appointed as the auditor of Te Mata for the year ended 31 March 2020. The financial statements show a profit before tax of $37 million for 2020 and $31 million for 2019. The statement of financial position shows a total of $73 million assets in 2020 and $62 million in 2019. The following points have arisen on the audit. Required Suggest the appropriate audit opinion for above each scenario. Provide reasons for your answers. Note: A written audit opinion is not required. The financial statements of Te Mata include only the Statement of Comprehensive Income, Statement of Financial Position, and Statement of Changes in Equity. No other components were included in the financial statements. (5 marks) Te Mata owns a few retail shops to sell wines and a factory to produce wine. As a policy, Te Mata revalues its retail shops annually. This year several of its retail shops rose sharply in value, as a result of it the total assets in the financial position increased. However, Te Mata does not revalue its factory premises, which is held in the statement of financial position at $ 975,000 (5 marks) o Previously. Te Mata values its inventory at WACC. In the current year, Te Mata's accounting policy for inventory has been changed to FIFO. The financial effect of the change in accounting policy has not been adequately disclosed in the notes of financial statements