QUESTION 2. The following financial statements relate to Ncobile Plc, a large publicly listed corporation Income statement for the year to 31 March 2022 Sale revenues $m $m 355 Operating costs (235) Operating profit before interest expense (7) 120 Interest taxes 3 (4) Profit before tax 116 Income taxes (32) Net profit for the year 84 Dividends paid (20) Retained profit for the year 64 Summarized balance sheets at: 31 March 2022 31 March 2021 Non-current assets $m $m Tangible assets 272 196 Intangible assets 3 4 275 200 Current Assets Inventories 140 155 Trade receivables 132 110 Interest receivable 1 2 Investments 95 -- Cash 4 21 372 288 Total assets 647 488 Shareholders equity: Ordinary shares S 1 each 154 125 10% S 1 Preferred shares 20 20 Revaluation surplus 7 -- Retained earnings 135 81 316 226 Non-current liabilities: Lon g term borrowings 6% bonds 2022 20 40 Q P - A S R - 0 0 1 | R e v 0 0 1 E f f D a t e : 0 9 - 0 8 - 2 0 2 3 Page 4 of 6 Finance leases Provision for liabilities and Chargesdeferred tax 50 12 42 8 82 90 Current liabilities 249 172 Total liabilities and shareholders equity 647 488 The following information is relevant: (i) During the year Ncobile Plc issued 20 million ordinary shares of no par value issued at $1 per share. Subsequent to this a bonus (capitalization) issue of 1 for 10 shares held was made from retained earnings. (ii) Tangible non-current assets include certain properties which were revalued during the year giving a surplus of $7 million. Assets capitalized under finance lease agreement amounted on GHS28 million. Disposals of assets having a net book value of $19 million realized $21million. Depreciation for the year was $37 million. (iii) There were no acquisitions or disposals of intangible non-current assets during the year. (iv)Investments purchased during the year were: $80 million loan stock dated 2031, and a loan note to a major public listed company which is repayable on demand. (v) Analysis of current liabilities at: 31 March 2022 $m $m 31 March 2021 Trade payables 216 135 Income taxes 17 12 Interest payable 3 2 Finance leases 5 3 Bank overdraft 8 20 249 172 $20 million of bonds were redeemed at par on 31 March 2022. (vi)Interest on finance leases of GHS3 million is included in the interest payable charged to the income statement. Required: (a) Prepare a cash flow statement for DOMA Ltd for the year ended 31 March 2022 in compliance with IAS 7 Cash flow statement (indirect method); (15 Marks) (b) State five (5) advantages of cash flow statement (5 Marks) (c) Differentiate between the direct and indirect method of cash flow statement (5 Marks) (Total: 25 marks)