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(PDF) Quick Reference on Ind AS 7, Statement of Cash Flows

Download Quick Reference on Indian Accounting Standard (Ind AS) 7, Statement of Cash Flows


Ind AS 7: Statement of Cash Flows

The objective of this Standard is to require the provision of information about the historical changes in cash and cash equivalents of an entity by means of a statement of cash flows which classifies cash flows during the period from operating, investing and financing activities.

Cash comprises cash on hand and demand deposits.

Cash equivalents are short term, highly liquid investments that are readily convertible into known amounts of cash and which are subject to an insignificant risk of changes in value.

An investment normally qualifies as a cash equivalent only when it has a short maturity of, say, 3 months or less from the date of acquisition.

Presentation of a Statement of Cash Flow

The statement of cash flows shall report cash flows during the period classified by operating, investing and financing activities.

Operating activities

Principal revenue-producing activities and other activities that are not investing or financing activities.

Investing activities

Acquisition and disposal of long-term assets and other investments not included in cash equivalents.

Financing activities

Activities that result in changes in the size and composition of the contributed equity and borrowings of the entity.

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