Cash Flow Statement

Format of Indirect Method

Calculation of Cash Flow from Operating Activities

Net Profit before tax xxx

Add: Non-cash and non-operating items which have
already been debited to P&L A/c:
a. Depreciation xxx
b. Transfer to Reserve & Surplus xxx
c. Goodwill written off xxx
d. Preliminary expenses written-off xxx
e. Discount or loss on issue of shares/debentures
written-off xxx
f. Loss on sale of disposal of fixed assets xxx
g. Loss on sale of investments xxx
------ xxx
------
xxx
Less: Non-cash and non-operating items which have
already been credited to P&L A/c :
a. Gain on sale of fixed assets xxx
b. Profit on sale of investments xxx
c. Income from interest or dividends on investments xxx
------ xxx
------
xxx
Add: Decrease in current assets (except cash/bank):
a. Decrease in Debtors xxx
b. Decrease in Bills Receivable xxx
c. Decrease in Inventory xxx
d. Decrease in prepaid expenses xxx
------- xxx
------
xxx
Add: Increase in current liabilities(except bank overdraft):
a. Increase in creditors xxx
b. Increase in Bills Payable xxx
c. Increase in outstanding expenses xxx
------ xxx
------
xxx
Less: Increase in current assets (as stated above) xxx
-------
xxx
Less: Decrease in current liabilities (as stated above) xxx
-------
Cash generated from operating activities before tax xxx
Less: Income tax paid xxx
-------
NET CASH FLOW FROM OPERATING ACTIVITIES xxx
Calculation of Cash Flow from Financing Activities

Cash Inflows:
a. Proceeds from issue of share capital xxx
b. Proceeds from long-term borrowings/loans xxx
c. Proceeds from issue of debentures xxx
------ xxx

Cash outflows:
a. Dividend Paid xxx
b. Interest paid xxx
c. Repayment of long-term loans xxx
d. Redemption of debentures xxx
------- xxx
-------
NET CASH FLOW FROM FINANCING ACTIVITIES xxx

Calculation of Cash Flow from Investing Activities

Cash Inflows:
a. Sale of fixed assets xxx
b. Sale of investments xxx
c. Interest received xxx
d. Dividend received xxx
------ xxx

Cash outflows:
a. Purchase of fixed assets xxx
b. Purchase of investments (shares) xxx
------- xxx
-------
NET CASH FLOW FROM INVESTING ACTIVITIES xxx
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NET CASH FLOW FROM OPERATING ACTIVITIES xxx

NET CASH FLOW FROM FINANCING ACTIVITIES xxx
NET CASH FLOW FROM INVESTING ACTIVITIES xxx

Add: Opening cash balance xxx

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CLOSING BALANCE OF CASH (as given in Balance Sheet) xxx