QUESTION $5(20$ Marks$)$

$5\mathrm{.}1$ You are a chartered accountant employed in the finance department of Medirite Ltd$,$ a company that

imports and sells medical supplies. The company$$s CEO, Mr Charles Smith, accidentally forwarded

the following email to you $($Albert King$)$ that was meant for the CFO, Mr Albert Gladwell.

$$Hi Albert,

I have just looked at our figures for the past financial year, and I must say, I am impressed! It was a good

decision to inflate the selling price of our vitamins and falsely market them as $100\%$ effective against

monkey$-$pox. After the scare that the public had with the Covid pandemic, they are so gullible! Those

vitamins sold like hot cakes!

My only concern is that, as the financial year end is approaching, that team of nosy external

auditors will be here soon. Hopefully they will not ask too many questions.

I must say I am not a fan of the auditors. They raised all kinds of issues about the composition of our board

and its committees, with which I do not agree. I firmly believe that as the CEO and member of the board, I

must be part of every committee of the board to enable me to properly run this company. I remembered a

few years ago, the auditors informed me that there are apparently all kinds of requirements

regarding the frequency of meetings. Who has time for that? A meeting once a year for each committee

is more than enough. Luckily, we have an all$-$male board of directors, so that keeps meetings short

and sweet, if you know what I$$m saying!

Anyhow, just wanted to let you know that I am happy with the figures. Keep up the good work.$$

REQUIRED:

Comment on the corporate governance of Medirite Ltd with reference to the King IV Code. $(10$ Marks$)$

$5\mathrm{.}2$ INFORMATION:

Trencor Limited has provided the following information:

$1.$ Total sales

ACTUAL BUDGETED

July August September October November December

R$520000$ R$540000$ R$580000$ R$610000$ R$650000$ R$730000$

$2.$ Thirty percent of sales are for cash.

$3.$ Credit sales are collected as follows:

a$.60\%$ one month after sales $$ these customers qualify for a $10\%$ discount

b$.20\%,$ two months after sales

c$.15\%$ three months after sales

d$.$ The remainder is written off as bad debts.

REQUIRED:

Compile the debtor$$s collection schedule for October, November and December.

$($use separate columns for each month$)$