Statement Of Cash Flows - Ifrs Edition

Learn how to prepare the statement in compliance with IAS 7

What you'll learn

Why cash is important?

Purpose of the statement of cash flows.

Operating cash flows.

Investing cash flows.

Financing cash flows.

Cash and cash equivalents.

The general format of the statement of cash flows

Sources of information to prepare the statement.

Direct vs indirect methods.

Indirect method items.

Disclosure of interest and dividends.

Non-cash transactions from investing and financing activities.

Requirements

Basic knowledge in accounting

Accounting principles

Description

Cash is important to any business. Investors usually look at net income as a main indicator to evaluate the company’s performance and project future results. But the main question here, how long this profit would be expected to continue? Revenues and expenses are recognized based on accrual accounting principle. As a result, we can report our profit in the income statement even though we didn’t collect the cash from our customers. If this case continues for a long period, the company will start to generate negative cash flows from its operations. In the long run, it will not be able to settle its liabilities and it may be filed for bankruptcy.This course will walk you through all the basics of preparing the statement of cash flows in compliance with the International Accounting Standard (IAS 7). We will start with the importance of cash, the purpose, and the usefulness of the statement of cash flows. After that, we will explain all related subjects step by step.The direct method is recommended by the standard. But, we will focus more on using the indirect method since it is widely used. There are two exercises to practice with me. Gradually you will be ready to prepare the statement in any company.Course ContentThis course is will covers the basics of preparing the statement of cash flows as follow:Why cash is that important?Purpose of the statement of cash flows.Usefulness of the statement of cash flows.Operating cash flows.Investing cash flows.Financing cash flows.Cash and cash equivalents.The general format of the statement of cash flows.Sources of information to prepare the statement.Direct vs indirect methods.Indirect method items.Disclosure of interest and dividends.Non-cash transactions from investing and financing activities.

Overview

Section 1: Introduction

Lecture 1 Importance of cash

Lecture 2 Purpose of cash flows statement

Lecture 3 Usefulness of cash flows statement

Lecture 4 Operating cash flows

Lecture 5 Investing cash flows

Lecture 6 Financing cash flows

Lecture 7 Interest and dividends

Lecture 8 Cash and cash equivalents

Section 2: Format of Cash Flows Statement

Lecture 9 The general format

Lecture 10 Sources of information

Lecture 11 Direct vs indirect methods

Lecture 12 Indirect method items

Section 3: Reporting Special Items

Lecture 13 Income tax paid

Lecture 14 Disclosure of interest and dividends

Section 4: Example One: Simple Format

Lecture 15 Example one: introduction

Lecture 16 Example one - working capital changes

Lecture 17 Example one: calculate interest paid

Lecture 18 Example one: calculate tax payment

Lecture 19 Example one: final solution

Lecture 20 Example one: receivables analysis

Lecture 21 Example one: payables analysis

Section 5: Example Two: Advanced Format

Lecture 22 Example two: introduction

Lecture 23 Example two: working capital changes

Lecture 24 Example two: receivables analysis

Lecture 25 Example two: inventory analysis

Lecture 26 Example two: payable analysis

Lecture 27 Example two: calculate tax payment

Lecture 28 Example two: operating cash flows

Lecture 29 Example two: investing cash flows

Lecture 30 Example two: financing cash flows

Lecture 31 Example two: non cash investing and financing activities

Lecture 32 Example two: challenge

Accountants,Professionals,Business owners,Anyone interested in reporting cash flows