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Institute-University School of Business Department-Mba

The document provides information about a course on financial reporting and analysis. It includes 3 learning outcomes: 1) To impart understanding of basic accounting principles, standards, and financial statement analysis. 2) To prepare financial statements like income statements, balance sheets, and cash flow statements. 3) To provide knowledge to support financial decision making. It then defines a cash flow statement as a statement of cash inflows and outflows during a time period. It classifies cash flows into operating, investing and financing activities and provides the standard format of a cash flow statement including sections for the different cash flow types. It concludes with discussing limitations of cash flow statements and providing references.

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Abhishek kumar
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77 views13 pages

Institute-University School of Business Department-Mba

The document provides information about a course on financial reporting and analysis. It includes 3 learning outcomes: 1) To impart understanding of basic accounting principles, standards, and financial statement analysis. 2) To prepare financial statements like income statements, balance sheets, and cash flow statements. 3) To provide knowledge to support financial decision making. It then defines a cash flow statement as a statement of cash inflows and outflows during a time period. It classifies cash flows into operating, investing and financing activities and provides the standard format of a cash flow statement including sections for the different cash flow types. It concludes with discussing limitations of cash flow statements and providing references.

Uploaded by

Abhishek kumar
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PPTX, PDF, TXT or read online on Scribd
You are on page 1/ 13

INSTITUTE-UNIVERSITY SCHOOL OF

BUSINESS
DEPARTMENT-MBA
Master of Business Administration
Financial Reporting and Analysis
BAT-601

CASH FLOW STATEMENT


DISCOVER . LEARN . EMPOWER
CASH FLOW
STATEMENT

Course Outcome
CO Title Level
Number

CO1 To impart understanding of the Basic Principles of Remember Will be covered in this
Accounting, Accounting Standards, Reading and Analyzing   lecture
Balance sheets and its application in modern day business
CO2 To prepare various financial statements i.e. trading Understand
account, Profit and loss account and balance sheet, P/L  
Appropriation account, cash flow statement etc.
CO3 To provide knowledge of concepts those are helpful in Understand
financial decision making

2
Meaning
Cash: Cash means all cash + cash equitable + marketable securities + bank balance.

Flow: Flow means flow of cash from business to economy and economy to business i.e. cash inflows and cash outflows.

Statement : Statement is a Performa prescribed by Charted Accountant Act,1948.

Thus,

Cash Flow Statement is a statement o f inflows (sources) and outflows (uses) of cash and cash equivalents in an
enterprise during a specified period of time.

3
Classification

• Cash Flow form Operating Activities


• Cash Flow from Investing Activities
• Cash Flow from Financing Activities

4
5
Format of Cash Flow Statement
ABC Limited
For the year ended…………..
(A) Cash Flows from Operating Activities:
Net Profit before tax & extraordinary items
Adjustment 1:
Depreciation & Amortization xxx
Provision for Doubtful Debts xxx
Foreign Exchange gain/loss xxx
Dividend xxx
Interest xxx
Gain/ Loss on sale of fixed assets/investments xxx xxx

6
Continued….
Operating Profit before Working Cap. Changes xxx
Adjustment 2 for changes in working capital:
Bills Receivables xxx
Debtors xxx
Inventories xxx
Prepaid Expenses xxx
Bills Payable xxx
Creditors xxx xxx
Cash Generated from Operations xxx
Income tax paid xxx
Cash before Extraordinary Items xxx

7
Continued….

Extraordinary Items xxx


Net Cash from (used in) Operating Activities xxx

(B) Cash Flow from Investing Activities:


Purchase of Fixed Assets xxx
Proceeds from Sale of fixed assets xxx
Purchase of Investments xxx
Proceeds from Sale of investments xxx
Interests received xxx
Dividend received xxx
Net Cash from (used in) Investing Activities xxx

8
Continued….

(C) Cash Flow from Financing Activities:


Proceeds from Issue of Shares/ Debentures xxx
Proceeds from Long-term debtsxxx
Repayment of Long-term Debtsxxx
Redemption of Debentures xxx
Redemption of Preference Shares xxx
Dividend paid xxx
Interest paid xxx
Net Cash from (used in) Financing Activities xxx
Net increase/decrease in cash and Cash Equivalents (A+B+C) xxx
Cash and Cash Equivalents at the beginning of the year xxx
Cash and Cash Equivalents at the end of the year xxx

9
Importance of Staffing
The cash flow statement has the following limitations:

• Misleading Comparisons

• Influenced by changes in Management Policies

• Incomplete Substitutes

10
Assessment Pattern

11
References

• Reference book- Maheshwari S.N, Accounting for Management, Vikas Publishing House, New Delhi,2010
• Reference Website: https://www.accountingcoach.com/cash-flow-statement/explanation/2
• Reference Journal for advance study: Journal of Accountancy (JOA)

12
THANK YOU

For queries
Email: [email protected]

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