matter-3

Reclassify the Rebate from Cost of Sales to Reduction in Revenue in the year to which it relate if the
amount is material this should be adjust even in the present case when the financials were issued for
the year ended 2022.

We will make following adjustments:

Reduce revenue

Dr. Revenue (2022) €/£ 200,000

Cr. Trade Receivables or Accrued Liabilities €/£ 200,000

Adjust Retained Earnings

Dr. Retained Earnings €/£ 200,000

Cr. Revenue (2022) €/£ 200,000

Reverse Cost of Sale Entry Recorded in 2023

Dr. Cost of Sales (2023) €/£ 200,000

Cr. Trade Payables or Cash €/£ 200,000

Matter -2

We need to make following adjustments in the financials of the MWP

Reverse the Incorrect Expense Entry:

Dr. Land (Non-Current Assets) €/£ 1,000,000

Cr. Expense (Statement of Profit or Loss) €/£ 1,000,000

Record the Correct Distribution to Shareholder:

Dr. Retained Earnings €/£ 1,000,000

Cr. Land (Non-Current Assets) €/£ 1,000,000

Matter-1

The financial statement of the company should be prepared on alternate basis as there is going cocern
uncertainity as management think appropriate in this situation in accordance with international
standerds on accounting.