Step by step approach to completing a statement, Financial Management

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Step by step approach to completing a statement of cash flows

Step by step approach to completing a statement of cash flows

Step 1

Set out pro forma, by using a whole side of paper leaving lots of spaces between 3 main headings of operating, investing and financing activities.

 

 

Step 2

Set up a workings page and read through all the additional information. Also make notes to see how they affect the statement of cash flows.

Step 3

Complete operating activities section (using the method instructed by question either direct or indirect). Incorporating interest and taxation cash flows if necessary.

Step 4

Complete investing activities section by looking at non-current assets. Make sure you take account of both intangible and tangible noncurrent assets.

Step 5

Complete  financing  section  by  looking  at  share  capital,  long  term  debt  and capital element of finance leases.

Step 6

Finally review income statement and statement of financial position to ensure all items have been dealt with. Complete the remaining statement of cash flows, and double check that decrease or increase in cash and cash equivalents during the period, corresponds to movement in cash and cash equivalent balances in 2 statement of financial position.


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