STT Tech Sdn. Bhd., a company providing IT and security services, is growing rapidly.

The firm's financial statements are currently prepared based on the Private Entity

Reporting Standards (PERS). At the moment, the company financial condition is the barrier for the company to keep expanding. Hence, Mr. Muaz, the Chief Executive Officer (CEO), has been thinking of going public and appoints you as Ute advisor on this matter.

(a) lf the company changed to public entity, then the Malaysian Financial Reporting Standards(MFRSs) must be adopted. The CEO needs clarilication on the International Financial Reporting standards (IFRSs). Explain how the MFRSs relate

to the IFRSs and the advantages of it.

(b) In rare circumstances, ab entity can exempt itself from complying with particular MFRSs. Explain to the CEO regarding the conditions that allow departure and how such departure should be reported.

(c) Reserves can be classified as distributable and non-distributable. Explain to Encik Muaz the difference between these two. Give appropriate examples.

(d) Discuss your views with regards to Mr.Ali Abu who is the firm's sales manager that the prices set by the marketplace tend to follow the trend of a company's earnings and dividends only.