You have been conducting an audit of the financial reports of
Rainbow Forest Ltd (Rainbow Forest). Rainbow Forest Ltd is a
publishing company, specialising in books and other promotional
material for special industry sectors and professional bodies. Over
the last three years Rainbow Forest has been experiencing difficult
trading conditions resulting in operating losses and deferred
dividends. In particular, Rainbow Forest has had difficulty
managing its cash flow. Book sales are down on the prior year and
longstanding customers are...