QUESTION ONE You have been approached to explain, by use of practical examples from financial statements, the components of the conceptual framework for financial reporting. In this regard, you have been provided with the following excerpt from a financial statement. Metal Fabricators of Zambia Plc Consolidated and Separate Financial statements For the period ended 30 September 2018 Statement of cash flows Cash flows from operating activities Cash (used by)/generated from operations Interest received Interest paid Income tax paid Net cash (used by)/generated from operating activities Cash flows from investing activities Purchase of property, plant and equipment Net cash used in investing activities Cash flows from financing activities Proceeds from long term loan Dividends paid Year-ended Notes 30/09/2018 Zmw'000 26 9 9 10 13 19 12 Group (63,310) 58 (27,295) (13) (90,560) (760) (760) 2 (3,792) Year-ended 30/09/2017 Zmw'000 63,064 3 (17,637) (935) 44,495 (1,484) (1,484) 3 4 185,736 (3,792) (source: Zamefa Plc). Required: a) Explain the purpose of the conceptual framework. (5 marks) b) Identify and describe fully what the items marked (1) to (5) in the financial statement excerpt above represent based on the components of the conceptual framework. (20 marks) [Total: 25