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The Indirect method whereby profit or loss is adjusted for the effects of transaction of a non-cash nature, any deferrals or accruals of past or future operating cash receipts or payments, and items of income or expenses associated with investing or financing cash flows.
INDIRECT METHOD STATEMENT OF CASH FLOW:
Cash flows from operating activities
Profit before taxation
Adjustments for depreciation
loss on sale of non-current assets
Investment income
interest expenses
decrease/ (increase ) in trade and other receivables
decrease/ (increase) in investments
(decrease)/ increase in trade payables
cash generated from operations
interest paid
income taxes paid
net cash from operating activities
Cash flows from investing activities
purchases of property,plant and equipment
proceeds from sale of equipment
interest received
dividends receive
net cash received from/ (used) in financing activities
Cash flows from financing activities
proceeds from issue of shares capitals
proceeds from/ (repayments of) long-term borrowings
payment of finance lease liabilities
dividends paid
net cash paid
net cash received from/ used in financing activities
Net increase / (Decrease) in cash and cash equivalent
cash and cash equivalents at beginning of period
cash and cash equivalents at end of period
Hope you get the answer which you desire:)
Cash Flow consist of Inflow & outflow, so the day to day different type of income must be feed on the side of Inflow & all day to day different type of expense on other side, with cumulative bank balance of all available account of operating company.
At last you can get summarize CASH FLOW which states the strength of Company.
