Investments, 11th Edition (exclude Access Card)
Investments, 11th Edition (exclude Access Card)
11th Edition
ISBN: 9781260201543
Author: Zvi Bodie Professor; Alex Kane; Alan J. Marcus Professor
Publisher: McGraw-Hill Education
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Chapter 18, Problem 19PS
Summary Introduction

To calculate: The value of a firm’s equity by using the free cash flow approach as per the above information.

Introduction:

Free cash flow is a measurement and it shows the company’s efficiency in generating cash. After payment, sufficient cash is used for this. Growing cash flow indicates the increase of earning.

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The Company’s Act 71 of 2008 has crucial regulations that relate to the auditing of financial statements of the companies. These regulations are regulation: 26, 27, 28, 29 and 43. These regulations work in conjunction with each other and are pertinent to the public interest score concept, audit and review requirements, reportable irregularities for independent reviews, the financial reporting standards with which different entities must comply as well as the social and ethics committee. The following relevant details pertain to Harakuta (Pty) Ltd: Employees at 31 January 2023 210 Employees at 31 December 2023 250 Long-term loan: FNB bank N$30.3 million Turnover for the year to 31 December 2023 N$60 million Number of shareholders as at 31 December 2023 33 Required:a. Calculate the public interest score of Harakuta (Pty) Ltd for 2023 financial year b. With a reason of your above calculation indicate if Harakuta (Pty) Ltd requires to be audited or not.
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