Professional Documents
Culture Documents
FM-cash Flow
FM-cash Flow
Cash
Flows
Statement
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Can we meet
our obligations
Cfs
Are cash flows to creditors?
sufficient to
support ongoing
operations?
Can we pay
Purpose
dividends? of CFS
Currency and
Bank Accounts
T-bills
Cash
Cash
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Cfs
Sources Uses
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FFS & CFS
Cfs
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IMPORTANCE AND RELEVANCE
Cfs
Sebi requirement- clause 32 of listing agreement
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Cfs CFS
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Operating Activities— Cash flows
Cfs
CP to acuire Fixed Assets, including intangible
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Financing Activities— Cash flows
Cfs
Payment of dividend
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PREPRATION OF CFS
Cfs
Indirect
Method
Direct
Method
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Cfs Direct Method or Indirect Method?
Indirect Method Direct Method
• Net income is • Net income is
reconciled to cash flow reconstructed on a cash
from operating basis.
activities.
• No supplemental • Requires a supplemental
schedule is required. reconciliation of net
income to cash flow from
operating activities.
• Used by 1% of
• Used by 99% of companies.
companies.
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Preparing a Simplified Statement of
Cfs Cash Flows
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Preparing a Simplified
Cfs Statement of Cash Flows
A reconciliation
of beginning
cash to ending
cash is also
required.
{
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Operating Activities
Cfs
Cash flow from operating Activities
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Investing Activities
Cfs
Add: Proceeds from sale of land,
buildings, equipment, or other
noncurrent assets XXX
Receipt of interest,dividend
from investments XXX
Less: Payments to acquire land,
buildings, equipment, or other
noncurrent assets (XXX)
Payments to acquire
investments (XXX)
Net Cash Flows from Investment Activities XXX
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Preparing CFS using changes
Cfs in Non Cash B Sheet Accounts
Changes in Changes in
Capital Stock Liabilities
Net Cash
Flows for a
Dividends Period Changes in
Paid to Noncash
Stockholders Assets
Net Income
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Preparing CFS using changes
Cfs in Non Cash B Sheet Accounts
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Preparing CFS using changes
Cfs
in Non Cash B Sheet Accounts
paramjit sharma
Preparing CFS using changes
Cfs in Non Cash B Sheet Accounts