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What are the main features of the Cash Flow Sta...

What are the main features of the Cash Flow Statement?

What are the main features of the Cash Flow Statement?

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Jeeba Mar. 15, 2018

Accounting standard 3 states that cash flow statement provides the information with the historical changes in cash and cash equivalents of an organisation. It shows the inflow and outflow of the cash and cash equivalent from operating, investing and financing activities. Cash flows from operating activities can be presented in two methods as the direct method or the indirect method.

This accounting standard strictly direct to disclose separately in the balance sheet and should present a reconciliation of the amounts in its cash flow statement with the equivalent items reported in the balance sheet. Cash flow statement provides information on the changes in net assets of an enterprise, its financial structure, and its ability to affect the amount and timing of cash flows in order to adapt to changing circumstances and opportunities. This statement also enhances the comparability of the reporting of operating performance by different enterprises because it eliminates the effects of using different accounting treatments for the same transactions and events.

What are the main features of the Cash Flow Statement?

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