(a).ROMM

1.analytical procedures

operating margin 35/220 = 16% 37/195=19%

risk of  overstate expenses, and understate profit.

ROCE 35/(110+229)=10%  37/(82+221)=12%

current ratio 143/19=7.5 107/25=4.3

interest cover 35/7 =5 37/7=5.3

gearing 110/229 82/221

etr 3/28 3/30

2.foreign exchange

m: sold in more than 100 countries

a: IAS21

R: not using correct rate or not retranslated

3.consolidation

m: 40sub 15 ass

a : elimination

r : not be consolidated correctly

4. acquisition of azalea

m 130/358  material

a it is a subsequent event, happen after the reproting period. need to be disclosed

r not disclosed appropriately then misstatement exists

5.PPE

m 20/358 material 5/25 material

a cost less depreciation is acceptable,but the change of estimated useful live is subject and complex. as the profit decrease, mgt has the incentive to manipulate the profit by chaing the useful life.

r risk that the change of useful lives is incorrect,lead to overstate profit and assets

6.gw

m 18/358 material

a ias36 gw need to be review for impairment annually. 

as profit decrease.

r risk that mgt did not take impairment review for gw. and then overstate assets and profit.

7. acquiired brand names.

m 80/358 material

a ias38  the 30m impair is significant, which could be subject and complex. 

asset like equiments to manufacure Chico perfume range could also be impaired if can not produce althernative product

r asset and profit could be overstated.

8.development cost

m 25/358 material

a ias38 PIRATE, 

r asset and profit could be overstated.

 9.debenture loans

m100/358 material

a ias23 dirct finance cost could be capitalised.

r not capitalised correctly, lead to misstatement.

10. finance cost

20/358 also material

a but contraditional with finance cost as it stay they same.

r risk of overstate profit and understate liabilities

11deferred tax

m 10/358 2.8% material

a dtl temperary differenccies. the DTLincrease 8, but the PPE's revaluation seems not consist with the increase of DTL,as the projected depreciation charge for the year is only 5m less than the comparative figure.

r risk that liabilities is overstated, profit is understated

12.effective tax rate

m

a

r