Question $1[25$ Marks$]$

a$)$ Define the following based on the conceptual framework using examples where possible:

i$.$ Relevance $(1$ mark$)$

ii$.$ Income$(2$ marks$)$

iii.$$ Liability$(2$ marks$)$

b$)$After graduating from Botho University, you get employed by the financial consultant. As your first task you are given a client, who has been trading successfully as a sole trader for a number of years. However, her business has grown so much that she now thinks it is time to consider converting the business into a limited company.

Prepare some brief notes for your client that explains:

$$i$)$ Outline three $(3)$ main advantages and two $(2)$ disadvantages of operating as a limited company rather than as a sole trader$(10$ marks$)$

ii$)$ The main types of share capital and their characteristics$(6$ marks$)$

iii$)$ Explain four $(4)$ objectives of the International Accounting Standards Board $($IASB$)?(4$ marks$)$