The audit firm that you are currently working at has recently been appointed as the auditor of Clarke Incorporated (Pty) Ltd ("Clarke"). Clarke supplies internet security solutions and is a fast-growing fast company due to the high demand for their services. Based on their Public Interest Score ("PIS"), Clarke has to be audited..As part of the pre-conditions and preliminary engagement activities, an engagement letter was drafted by a First Year Audit Clerk. The following engagement letter was compiled: 30 November 2022 The Shareholders Clarke Incorporated (Pty) Ltd 46 Strand Street Cape Town 1234 To the CFO We have completed all preliminary investigations into your company. We are pleased to confirm our acceptance and our understanding of this independent review engagement by means of this letter. Our independent review will be conducted with the objective of our expressing a limited assurance opinion on the financial statements. We hereby confirm the terms of our engagement as follows: 1. We will conduct the review for which we have been duly appointed for 28 February 2023. 2. Our role as independent reviewers is to audit the fair presentation of the financial statements. 3. We will do our review in terms of IFRS. 4. Fees will be a matter of negotiation but will be based on prior years. Our responsibility We will conduct our audit in accordance with the International Standard on Review Engagements (ISRE) 2400. Those standards require that we comply with ethical requirements and plan and perform an independent review to obtain absolute assurance about whether the financial statements are free from material misstatement. An independent review involves performing procedures to obtain independent review evidence about the amounts and disclosures in the financial statements. This Standard requires that we plan and perform the review to obtain limited assurance as to whether the financial statements are free from material misstatement. A review is primarily limited to test of controls applied to financial data and thus provides less assurance than an audit. A review differs significantly from an audit of financial statements, in which the auditor provides reasonable assurance that the financial statements, taken as a whole, are free from material misstatement. A review provides only limited assurance that nothing has come to our attention that causes us to believe that the accompanying financial statements are not give a true and fair representation. Our engagement cannot be relied upon to disclose errors, fraud, or illegal acts that may exist. However, we will inform the appropriate level of management of any material errors, and of any evidence or information that comes to our attention during the performance of our review procedures that fraud may have occurred. In addition, we will report to you any evidence or information that comes to our attention during the performance of our review procedures regarding illegal acts that may have occurred. Please would you sign this letter, retain a copy, and return the original to us. We look forward to working on your review. Signed Audit Senior Identify all the weaknesses in this engagement letter. You are not required to redraft the letter