Cash Flows

A statement of cash flows reports net cash provided or used in each of the four categories of classifying cash transactions. It also reports the net effect of these flows on cash and cash equivalents during the fiscal year in a manner that reconciles beginning and ending cash and cash equivalents for the year. The statement of cash flows has four distinct sections:

  • Cash involving operating activities
  • Cash involving investing activities
  • Cash involving financing activities
  • Supplemental information.

Non-Cash Investing, Capital and Financing Activities
Report information about investing, capital and financing activities that affect assets and liabilities but do not result in cash receipts or cash payments in the period. Present this information with the statement of cash flows in the section titled u201cnon-cash transactions.u201d Include line items in the non-cash transaction section of the statement of cash flows for:

  • Net change in fair value of investments
  • Donation of capital assets
  • Borrowing under a capital lease purchase
  • The acquisition of assets by assuming directly-related liabilities
  • Exchanging non-cash assets or liabilities for other non-cash assets or liabilities

When transactions are part cash and part non-cash, report only the cash portion within the statement of cash flows. Report the non-cash portion in the non-cash transaction section supplemental to the statement of cash flows.

Accounting & Finance for Banking

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Accounting and Finance for Banking Module A Pdf

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