 Now today we are going to take up a full question on financial statements including all those three statements, cash flow statement is not going to be there because cash flow statement is going to be our next topic. Now look this question, there is a company called Usman Limited and they have share capital of 10 rupee per share, then bank account, then share premium, then we have inventory beginning January and then we have accounts payable, we have mislead expenses, we have sale tax. Now do remember sale tax is not our expense as such, it is adjustable so you will see later on. Then sales are there, then building cost is there, dividend paid is there, plant and equipment is there, purchases are there, motor vehicle is there, then we have suspense account again, something which is not clear and the accountant know where to report it or how to record it, retained earnings, commuter depreciation all those three assets, audit fee, official salaries, distribution expenses, staff salaries, income tax under provision of last year. In last year the tax provision was low or this kind of finance charge or a total of your trial balance agree. Now there are some adjustments on this base. Now the adjustments, as we said earlier also, these adjustments are many and in case in this question there are numbers, first is 150,000 new ordinary shares were issued at rupees 15, 10 rupees share were issued for 15. So obviously 10 rupees is the power value and 5 rupees is the premium. So when we prepare the statement of change in equity we will show there that there is an addition of share capital and there is an addition of premium. Inventory of last year was valued at 2400 while doing the inventory count error is in previous year's inventory count were discovered. You know there was a mistake last year, so now we discovered now, so obviously we need to adjust this error somewhere, how we cannot do it in the current year period income statement but what we do, the change in equity statement there is a retained earnings, we will adjust it there. Do remember if there is a mistake of last year it should be taken to last year's profit and loss, last year's figures not current year figures. Then another thing is there is a customer who got bankrupt and he owe you 1000, 1114,000, the debt is not expected to be recovered, straight away it is not expected to be recovered. So what we do, we have to write top, so it means we reduce our debtors and this should be a loss and we should report this loss to the income statement and whatever remaining debtors we create allowance for debts of 5%. So there is an adjustment, first you write off the debt and then remaining debtors again provide a 5% provision for debts. Usually this provision for bad debts is because normally it happens that all the debtors are not paying, so we need our experience shows that 2, 3, 4, 5% we make a provision. Then income tax amount is given, in the last you will see the taxable profit was given, in this case it is the tax figure is given. Final dividend, no final dividend proposed, if in case they declare any proposed dividend, it will not be reported in this statement of change in equity because it is not paying. It should be reported in the notes to the account that the company has declared the dividend. Depreciation to be provided, 5% state line charged to the administrative extent. Previously what we did, we add together and we added it to the cost of goods sold. But now he said clearly, so for building is concerned, whatever depreciation we charged today, this time it should be added to the administrative extent. Similarly plant and equipment 20% of reducing balance, to remember here, it is a building state line and equipment reducing balance method. So you have to be very careful that what method we are following. Then motor vehicle 25% of reducing balance method, again you have to be very careful that how the depreciation schedule is going to be prepared. The requirement is the following statements, income statement showing classification of expenses by functions. Here it is important is given clearly that you need to show functional expenses, administrative selling distribution they are clearly mentioned and detail of them should be in a schedule. Then the statement of change in equity for the year December 31st 2009 and the statement of financial position also as on December 31st 2009. Now these are the three main statements you have to prepare out of that question. Do remember the cash flow statement is not required here because for cash flow statement there is a next standard we are going to discuss IS-7 and that will be later on inshallah.