The company purchased 15,000 of property, plant and equipment during 20X7.

During 20X7 equipment originally purchased for 5,000 was sold for 12,000. The accumulated depreciation on the equipment was 2,000 at the end of sale.

Dividends of 6,000 were paid to shareholders on 1 July 20X7.

The finance costs of 1,100 represent bank interest charges. The interest was paid in full during the year.

Required:

a) Prepare a statement of cash flows for Manning Ltd for the year ended 31 December 20X7 using the direct method.

[15 marks]

b) Prepare a statement of cash flows for Manning Ltd for the year ended 31 December 20X7 using the indirect method.

[11 marks]

c) Review Mannings cash flow position for the year ended 31 December 20X7.

[4 marks]

d) Identify and explain at least four ways in which Integrated Reporting (IR) can address the limitations of the traditional style of reporting.

[20 marks]

[Total 50 marks]

The following information has been extracted from the financial statements of Manning Ltd. Manning Ltd Statement of profit or loss for the year ended 31 December 20X7 Revenue 120,000 Cost of sales (60,000) Gross profit 60,000 Employee salaries (20,000) Rent (5,600) Lighting and heating (4,000) Profit on disposal of PPE 9,000 Depreciation on equipment (8,000) Allowance for doubtful receivables (2.000) Operating profit 29,400 Finance costs (1,100) Profit before tax 28,300 Income tax expense (4,500) Profit for the period 23.800 Manning Ltd Statements of financial position at 31-Dec- X7 31-Dec- X6 20,000 16,000 ASSETS Non-current assets Property, plant and equipment Current assets Inventory Trade receivables 30,000 Allowance for doubtful receivables (3,000) Net trade receivables Cash and cash equivalents 12,000 10,000 10,000 (1,000) 27,000 12,300 51,300 71.300 9,000 8.000 27,000 43.000 Total assets EQUITY AND LIABILITIES Equity Share capital Retained earnings 20,000 22,800 42,800 20,000 5,000 25,000 16,000 11,000 Non-current liabilities Bank loan Current liabilities Trade payables Current tax liability Total equity and liabilities 8,000 4,500 71.300 4,000 3.000 43.000 The following additional information is available: Trade receivables are analysed as follows: At 31 Dec 20X7 Trade receivables (gross) 30,000 Allowance for doubtful (3,000) receivables Trade receivables 27,000 At 31 Dec 20X6 10,000 (1,000) 9,000