In this section…
In this section we shall look at the statement of cash flows which is the last main statement in a set of financial statements. We shall look at how the statement is prepared and presented. In doing so we shall use the indirect method to prepare the cash flows from operating activities.
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4.01 The Statement of Cash Flows
- What the statement of cash flows measures and the benefits provided by the statement
- Cash and cash equivalents
- Structure of the statement
- Direct and indirect methods
- Presentation of the statement
4.02 Cash Flows from Operating Activities
- The indirect method
- General approach
- Starting point
- Non-cash items
- Changes to working capital
- Interest and tax
4.03 Cash Flows from Investing Activities
- Proceeds from the disposal of property, plant and equipment
- Acquisitions of property, plant and equipment
- Interest received
- Dividends received
4.04 Cash Flows from Financing Activities
- Proceeds from share issues
- Proceeds from new loans/debentures and repayments of loans/debentures
- Payment of dividends
4.05 Reconciliation of Cash and Cash Equivalents
- Net movement
- Cash and cash equivalents over the financial period
4.06 Statement of Cash flows – additional questions
- Questions on
- Calculating cash flows
- Preparing the reconciliation of profits to net cash flows from operating activities
- Preparing the statement of cash flows