Answer Posted / chalapathi rao govada
According to the Revised AS-3 issued by the ICAI all listed
companies are required to prepare and publish the CASH FLOW
STATEMENT in its financial statement, Companies at their
discretion they can prepare it either usting Direct method
or indirect method.(Indirect method is recomonded by the
institute).
Cash flow statement explains the flow (in and out movement)
of cash and cash equivlaents in an organisation during
accounting period.
The generally accepted format for CFS
Opening Cash and Cash Equivalents
Adj: Cash flow from
Operating Activities (Main business operations)
Investment Activities (Investment transactions)
Financing Activities (Capital and LT sources)
Closing Cash and Cash Equivalents
Conclusion: It explains Cash we generated our cashflows
duing the accounting period (eg Opearating and Non
operating), and how cash leaves our organisation
investments, Retained earnings and repayment of long term
debt not but not least payment of taxes and dividends.
Wonderful topic for discussion........
If any one needs any clarifications or more and more
sources for this get in touch me @ 9703200360.
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