9
Cash Flow Statement
CHAPTER OBJECTIVES
This chapter will help the readers to:
- Appreciate the need for cash flow statement.
- Learn preparation of cash flow statement.
- Differentiate between cash flow from operating activities, financing activities and investing activities.
- Understand and analyse the information conveyed by the cash flow statement of various companies.
- Identify the key requirements of AS 3 ‘Statement of cash flow’.
9.1 NEED FOR CASH FLOW STATEMENT
The balance sheet and the profit and loss account provide useful information about the financial health of a business enterprise. The former provides us information about the sources (liabilities) and application (assets) of funds at the end of the accounting year, whereas the later ...
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