6Statement of Cash Flows

  1. Introduction
  2. Scope
  3. Definitions of Terms
  4. Background
    1. Benefits of Statement of Cash Flows
    2. Exclusion of Non-Cash Transactions
    3. Components of Cash and Cash Equivalents
  5. Presentation
    1. Classifications in the Statement of Cash Flows
    2. Reporting Cash Flows from Operating Activities
      1. Direct vs. Indirect Methods
  6. Other Requirements
    1. Gross vs. Net Basis
    2. Foreign Currency Cash Flows
    3. Cash Flow Per Share
    4. Net Reporting by Financial Institutions
    5. Reporting Futures, Forward Contracts, Options and Swaps
    6. Reporting Extraordinary Items in the Statement of Cash Flows
    7. Reconciliation of Cash and Cash Equivalents
    8. Acquisitions and Disposals of Subsidiaries and Other Business Units
  7. Disclosure and Examples
    1. Other Disclosures Required or Recommended by IAS 7
  8. Consolidated Statement of Cash Flows
  9. US GAAP Comparison


IAS 7, Cash Flow Statements, became effective in 1994. IAS 7 had originally required reporting entities to prepare the statement of changes in financial position (commonly referred to as the funds flow statement) as part of a complete set of financial statements. The IASB has amended the title of IAS 7 from Cash Flow Statements to Statement of Cash Flows (the title used in the US) as a consequence of the latest revision of IAS 1, Presentation of Financial Statements, a result of the IASB and FASB deliberations on the first phase of the Financial Statement Presentation project. The statement of cash flows is now universally accepted and required under most ...

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