Statement of Cash Flows

Course Objectives

• Upon completion of the course, participants will be able to:
• Distinguish between cash flows from operating, investing and financing activities.
• Reconcile differences between net income and cash flow from operations.
• Develop insights about the liquidity and solvency of a company
• Help predict future cash flows by explaining the change in the cash balance as reported on the balance sheet.
• Prepare a statement of cash flows using both direct and indirect methods.

Designed For

Finance managers, financial controllers, chief accountants, accounting supervisors, financial and management accountants.

Course Outline

• Introduction to Financial Statements
• The link between the three major financial statements – income statement, balance sheet and statement of cash flows
• Myth of “Profit” – I MADE PROFIT, BUT WHERE IS THE CASH?
• Definition of “profit”
• Subjective judgments influencing profit figures – provisions and accruals
• Reconciling between profits and cash flow figures
• Preparing statement of cash flows
• Cash flow from operating activities – direct vs. indirect method
• Cash flow from investing and financing activities