The financial statements of Roster Limited is provided below: Statements of Comprehensive Income for the year ended 31st December 2017 and 2016 2017 2016 $ $ Sales (all credit) 3,344,800 3,149,600 Cost of Sales (all credit purchases) -1,757,400 -1,625,200 Gross Profit 1,587,400 1,524,400 Operating expenses: -975,800 -933,200 Selling, general and administrative 792,600 742,400 Other expenses 183,200 190,800 Operating Profit 611,600 591,200 Other income: 5,400 6,600 Interest income 5,400 6,600 Profit before interest 617,000 597,800 Interest expense -103,584 -121,216 Profit before tax 513,416 476,584 Tax -154,026 -142,974 Profit after tax 359,390 333,610 Statement of Financial Position for the year ended 31st December 2017 and 2016 2017 2016 $ $ Assets Non Current assets 1,628,600 1,566,000 Current Assets: 1,275,800 1,213,200 Inventories 462,400 406,000 Accounts receivable 578,200 555,600 Cash and cash equivalents 235,200 251,600 Total assets 2,904,400 2,779,200 Equity and liabilities Equity 1,306,200 1,257,800 Ordinary Share Capital (1 200 000 Shares) 1,200,000 1,200,000 Retained earnings 106,200 57,800 Non-current liabilities (16% p.a) 647,400 757,600 Current liabilities 950,800 763,800 Accounts payable 216,200 201,600 Other current liabilities 734,600 562,200 Total Equity and liabilities 2,904,400 2,779,200 Note: The market price per share for 2017 was $1.30 and for 2016 was $1.20. Inventory for 2015 was $449360.

REQUIRED a) Use the information from the financial statements of Roster above to calculate the following ratios for 2016 and 2017. (where applicable round off answers to two decimal places.) i) Profit margin (Net profit margin) ii) Return on Assets iii) Return on equity iv) Earnings per share v) Price/earnings ratio vi) Capital Gearing Ratio vii) Creditors payment period viii) Debtors (Receivables) Collection Period ix) Quick Ratio and Current Ratio x) Inventory (Stock) Turnover [in times] (10 marks)

b) Analyse and comment on the performance of Roster Limited between 2016 and 2017 in terms profitability, efficiently, liquidity and investment. Word limit: 1500 (10 marks)

c) Manzini Information Technology (MIT) was founded by Steven Manzini ten years ago. The firm has grown into a successful business with 200 employees and many corporate clients. Recently, the business has considered converting into a public company. Advice Steven on the issues to consider as he ponders on this decision and what implications this might entail in relation to the requirements for financial statements.