The accountant of Lala Bhd is considering a number of transactions and events and how they should be treated in accordance with the concepts and qualitative characteristics of financial information as set out in the conceptual framework.

During the year ended 31 March 2019, Lala Bhd experienced the following transactions or events.

1. Sold and asset to a finance company and leased it back for the remainder of its useful life. The accountant decided that this should be treated as a secured loan.
2. The companys statement of profit or loss prepared using historical costs showed a loss from operating its shops, but the company aware that the increase in the value of its properties during the period far outweighed the operating loss.
3. Inventory has up to this year been valued using FIFO but the accountant is considering changing to the weighted method for the year to 31 March 2019.

Based on the above situation answer the following questions:

1. The accountant is aware that some members of the Board of Lala Bhd have little understanding of accounting and he worried about his presentation of the financial statements at the board meeting. How should he deal with this situation?

1. In doing his presentation he should omit any complex issues, so that everybody can understand what he is saying.
2. He should open his presentation with the advice that some of them may not understand all of it.
3. He classifies, characterise and present the information clearly and precisely.
4. He should deliver his presentation just to those who are financially qualified.