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• OPERATING CASHFLOW HOW TO

IAS 7 Cash Flow Statements replaced IAS 7 Statement of Changes in Financial Position (issued in October 1977).Īs a result of the changes in terminology used throughout the IFRS Standards arising from requirements in IAS 1 Presentation of Financial Statements (issued in 2007), the title of IAS 7 was changed to Statement of Cash Flows. In April 2001 the International Accounting Standards Board adopted IAS 7 Cash Flow Statements, which had originally been issued by the International Accounting Standards Committee in December 1992. financing activities are activities that result in changes in the size and composition of the contributed equity and borrowings of the entity.The aggregate cash flows arising from obtaining and losing control of subsidiaries or other businesses are presented as investing activities. investing activities are the acquisition and disposal of long-term assets and other investments not included in cash equivalents.the indirect method, whereby profit or loss is adjusted for the effects of transactions of a non-cash nature, any deferrals or accruals of past or future operating cash receipts or payments and items of income or expense associated with investing or financing cash flows.the direct method, whereby major classes of gross cash receipts and gross cash payments are disclosed or.An entity reports cash flows from operating activities using either: operating activities are the principal revenue-producing activities of the entity and other activities that are not investing or financing activities.

The statement classifies cash flows during a period into cash flows from operating, investing and financing activities: Cash equivalents are short-term, highly liquid investments that are readily convertible to known amounts of cash and that are subject to an insignificant risk of changes in value. Cash comprises cash on hand and demand deposits.

OPERATING CASHFLOW HOW TO

IAS 7 prescribes how to present information in a statement of cash flows about how an entity’s cash and cash equivalents changed during the period.