The fieldwork for the 30 June 20X0 audit of Tracy Brewing Company Ltd was finished on 19 August 20X0 and the completed financial statements, accompanied by the signed audit reports, were mailed on 6 September 20X0. In each of the highly material independent events (a)-(i) below, state the appropriate action (1)-(4) for the situation and justify your response. The alternative actions are as follows:

1. Adjust the 30 June 20X0 financial statements.

2. Disclose the information in a footnote in the 30 June 20X0 financial statements.

3. Request the client to recall the 30 June 20X0 statements for revision.

4. No action is required.

The events are as follows:

a. On 14 December 20X0 the auditor discovered that a debtor of Tracy Brewing had been placed in liquidation on 2 October 20X0. The sale had taken place on 15 April 20X0, but the amount appeared collectible at 30 June 20X0 and 19 August 20X0.

b. On 15 August 20X0 the auditor discovered that a debtor of Tracy Brewing had been placed in liquidation on 1 August 20X0. The most recent sale had taken place on 2 April 20X9 and no cash receipts had been received since that date.

c. On 14 December 20X0 the auditor discovered that a debtor of Tracy Brewing had been placed in liquidation on 15 July 20X0, due to declining financial health. The sale had taken place on 15 January 20X0.

d. On 6 August 20X0 the auditor discovered that a debtor of Tracy Brewing had been placed in liquidation on 30 July 20X0. The cause of the insolvency was an unexpected loss of a major legal action on 15 July 20X0, resulting from a product deficiency action by a different customer.

e. On 6 August 20X0 the auditor discovered that a debtor of Tracy Brewing had been placed in liquidation on 30 July 20X0 for a sale that took place on 3 July 20X0. The cause of the insolvency was a main uninsured fire on 20 July 20X0.

f. On 31 May 20X0 the auditor discovered an uninsured legal action against Tracy Brewing that had originated on 28 February 20X0.

g. On 20 July 20X0 Tracy Brewing settled a legal action out of court that had originated in 20X7 and is currently listed as a contingent liability.

h. On 14 September 20X0 Tracy Brewing lost a court case that had originated in 20X9 for an amount equal to the legal action. The 30 June 20X0 footnotes state that in the opinion of legal counsel there will be a favourable settlement.

i. On 20 July 20X0 a legal action was filed against Tracy Brewing for a patent infringement action that allegedly took place in early 20X0. Legal advice suggested there is a danger of a significant loss to the client.