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Question 2 Read the case study and answer the questions given below: Mrs. Noor is currently working as CFO in Oman Refinery Company, and she

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Question 2 Read the case study and answer the questions given below: Mrs. Noor is currently working as CFO in Oman Refinery Company, and she has worked in the company for the last 10 years. Last year she was prompted from Financial Controller to CFO due to her excellent achievement which allowed the company to generate significant profit. Mrs. Noor is generally rewarded based on five key performance indicators and two of these indicators were to increase company revenue by 6% per year and to minimize the operational expenses by 3% annually Apparently, she was able to meet these indicators and she was entitled for 1% of net profit plus bonus shares of 10,000. This year the company suffers from liquidity and financial problems. The board is worried about the likelihood of going concern. In June 2019, the internal audit department investigated the issue to find out the main causes for these critical problems. Last month, the results of audit team were that the company was involved in signing 5-year contract with Zone Company. The revenue of 5 years was accelerated and recorded in the first year of the contact by Oman Refinery Company. Zone Company collapsed last year because of financial fraud. Moreover, last year, the company intended to seek for additional bank loan from Bank Muscat, but the bank refused to grant it because the likelihood of a covenant default was too high. The uncertainty of future performance for the company is high. The bank is concerned about the money borrowed to the company. Questions: i. Identify and explain TWO symptoms of going concern for Oman Refinery Company (2 marks) ii. Which hypothesis of positive accounting theory relevant to this case? Justify your (1 mark) How do you think the uncertainty of the company in the future could be reduced? (2marks)

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