Management Accounting

4

Cash Flow Analysis

LEARNING OBJECTIVES

On completion of the study of the chapter, you should be able to understand:

• What is meant by Cash?

• What is a Cash Flow Statement?

• What are the uses and advantages of preparation of a Cash Flow Statement?

• Distinction between a Cash Flow Statement and a Cash Book.

• Distinction between a Cash Flow Statement and a Fund Flow Statement.

• How to prepare a Cash Flow Statement under the Traditional Method?

• How to prepare a Cash Flow Statement as per Indian Accounting Standard (AS-3) (Revised), as issued by the Institute of Chartered Accountants of India?

• What are the purposes of computation of Net Cash Flows from Operating, Investing and Financing Activities separately as per AS-3 (Revised)?

• Fundamental difference ...