cash flow statement

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Cash Flow Statement

A statement every publicly-traded company must file with the SEC each quarter indicating all cash inflows and cash outflows from all sources, whether they are business activities or the company's investments. This is considered one indication among many of a company's financial health. A business activity may be reported as income if a company has agreed to a contract, even if no money has actually changed hands; a cash flow statement seeks to avoid this by showing how much cash the company has on hand. It is also called an application of funds statement.
FRS 1 cash flow statementclick for a larger image
Fig. 19 FRS 1 cash flow statement.

cash flow statement

a statement which is included as part of a UK company's published annual report and accounts. The one used in the UK in 2002 is prepared in accordance with the provisions of FRS 1 (Financial Reporting Standard 1) . This shows where the finance came from and where it went out to during the period under review and helps to explain the movements in the cash and bank balances, as illustrated in Fig. 19. See also, FUNDS FLOW ANALYSIS, SOURCES AND USES OF FUNDS STATEMENTS.
References in periodicals archive ?
The major purpose of this study is to determine if nonarticulation for individual accounts between the statement of cash flow and balance sheet is occurring for publicly traded companies in Hong Kong.
Sales and purchases are not netted and are reported in the statement of cash flows as investing activities.
Operating Activities: This section of the statement of cash flows reports the amount of cash generated or consumed by the operations of the business over a period of time.
The Statement of Cash Flow attempts to recognize the "cash movement" of revenue, so the net income amount (which starts with revenue on the Income Statement) is adjusted for the change in accounts receivable.
Each of these three examples highlights the large magnitude of restatements that can occur due to the misclassification of items within the statement of cash flows.
In effect, the statement of cash flows forms a bridge between the two statements, bringing together all transactions that have a cash implication, whether they relate to operating, investing or financing activities, and whether they are revenue or capital in nature.
The Statement of Cash Flows, often regarded as one of the most important pages in the Annual Report, can be viewed as one of the most flawed and misleading of the financial statements.
Both laymen and accountants who do not work regularly with the Statement of Cash Flows sometimes find that of all the financial statements, the Statement of Cash Flows is the most misunderstood and confusing.
Based on the information from your balance sheet and income statement, an accountant can prepare a statement of cash flows for your company.
The consolidated statement of cash flows for the nine months ended September 30, 2006 contained a mathematical error, resulting in inaccurate net cash provided by operating activities and accordingly, in the net increase in, and end of period, cash and cash equivalents.
The proceeds from share issue--ie, the $130--go to the "Financing activities" section of the statement of cash flows.
19, Reporting Changes in Financial Position, and requires a statement of cash flows as part of a full set of financial statements for all business enterprises in place of the statement of changes in financial position.

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