Chapter 4. STATEMENT OF CASH FLOWS (ASC 230)

INTRODUCTION

The statement of cash flows presents information about cash receipts by and payments to an entity during a period, as well as information about the entity's investing and financing activities. Since the ultimate objective of investment and credit decisions is the maximization of net cash inflows, information for assessing the amounts, timing, and uncertainty of prospective cash flows is needed by potential investors, creditors, and others making investment and credit decisions.

SCOPE

The requirements of ASC 230 apply to all entities, including both businesses and not-for-profits that prepare "general-purpose financial statements" that have to be presented in accordance with generally accepted accounting principles (GAAP).

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