3. On 30 January 2021, it was discovered that during the year, an accountant
intern had debited the Audit fees from an invoice received from the external
audit firm for work performed to an amount of R900 000. The accountant
discovered that two-thirds of the audit work was performed before the 28
February 2021 and the rest between 1 March 2021 to 31 March 2021. The total
amount of R 900 000 was paid in the current year.
ADDITIONAL INFORMATION:
• Assume that South African normal tax rate of 30%.
• Assume that all amounts are material and that the company is a going concern,
notwithstanding the effect of the above events on the financial statements
REQUIRED:
a. Identify each case in terms of IAS 10 as an adjusting event or a non-adjusting event
after the reporting date.
b. Provide an extract from the financial statements of TUT Limited on 28 February
2021 disclosing the results of each case to comply with the requirements of the Companies Act 71 of 2008 and IFRS.