(i) The current Conceptual Framework document defines equity as the residual interest in the assets of the enterprise after deducting all its liabilities. Identify the shortcomings in this definition. (5 marks)

(ii) Employees of a particular garment factory contracted COVID19 during the course of their employment. Few employees were seriously ill and have had severe reactions as a result. A number of these employees have decided to take the garment factory to court for failing to provide them with a safe working environment. The outcome of the lawsuit is highly uncertain. Advise the accountant if a liability exists.