U.S. GAAP Codification of Accounting Standards

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U.S. GAAP Accounting Standards
Codification Topic 230: Statement of Cash Flows


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Codification Topic 230
Statement of Cash Flows


Statement of Cash Flows

SFAS 95, November 1987
"Statement of Cash Flows"

SFAS 102, February 1989
"Statement of Cash Flows - Exemption of Certain Enterprises and Classification of Cash Flows from Certain Securities Acquired for Resale - an amendment of FASB Statement No. 95"

Presentation of Cash Flows
1. Statement of cash flows reports (A) by (B)
--> (A) net cash provided or used
--> (B) operating, investing and financing activities
2. For operating activities, (C) is required to be presented
--> (C) Reconciliation of net income and net cash flow
3. Presentation of "Cash Flow per Share" is not allowed

Types of Activities
1. Operating activities
2. Investing activities
3. Financing activities

Operating Activities
1. Cash received from sale of goods or services
2. Cash paid to suppliers and employees
3. Receipt of dividends
4. Receipt of interests
5. Payment of interests
6. Receipt of insurance proceeds
7. Income taxed paid

Investing Activities
1. Acquisition of debt instruments of other entities
2. Sale of debt instruments of other entities
3. Acquisition of equity instruments of other entities
4. Sale of equity instruments of other entities
5. Acquisition of property, plant and equipment
6. Sale of property, plant and equipment
7. Capital expenditures
8. Payment for purchase of another entity

Financing Activities
1. Issuance of equity instruments
2. Payment of dividends
3. Repurchase of equity instruments
4. Proceeds from short-term borrowings
5. Repayment of short-term borrowings
6. Proceeds from issuance of bonds and other long-term borrowings
7. Repayment of bonds and other long-term borrowings

Reporting Operating Activities
1. Direct method
2. Indirect method
3. Direct method is "encouraged"

Direct method reports (1), (2) and (3)
--> (1) major classes of gross cash receipts from operating activities
--> (2) major classes of gross cash payments for operating activities
--> (3) net cash flow from operating activities

Indirect method
Net cash from operating activities = Net income + (4)
--> (4) Adjustments from net income to net cash from operating activities

(4) includes the following:

1. Add non-cash expenses
---> Example: depreciation and amortization

2. Subtract gain on sale of property, plant and equipment
--> Gain on sale of property, plant and equipment is included
--> in cash flows form investing activities

3. Decrease in non-cash current assets --> add
--> Example: collection of accounts receivable 
--> decreases non-cash current assets, increases cash,

4. Increase in current assets --> subtract
--> Example: purchase of inventories in cash 
--> increases non-cash current assets, decreases cash

5. Decrease in current liabilities --> subtract
--> Example: payment of accounts payable 
--> decreases current liabilities, decreases cash

6. Increase in current liabilities --> add
--> Example: increase in accounts payable 
--> increases current liabilities, increases cash

International Financial Reporting Standards (IFRS)

   IAS 7: Statement of Cash Flows


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   Codification Topic 230
   Statement of Cash Flows
 
Subtopics of Codification Topic 230
 
   230-10 Overall    
 
Accounting Terms of Codification Topic 230-10
 
   Cash
   Cash equivalents
   Financing activities
   Investing activities
   Operating activities   



   Other Topics at the Codification 200 
Accounting Standards Codification, ASC, Overview
 
ASC Codification Topic 205: Presentation of Financial Statements
 
ASC Codification Topic 210: Balance Sheet
ASC Codification Topic 215: Statement of Shareholder Equity
 
ASC Codification Topic 220: Comprehensive Income
ASC Codification Topic 225: Income Statement
 
ASC Codification Topic 230: Statement of Cash Flows
ASC Codification Topic 235: Notes to Financial Statements
 
ASC Codification Topic 250: Accounting Changes and Error Corrections
ASC Codification Topic 255: Changing Prices
 
ASC Codification Topic 260: Earnings per Share
 
ASC Codification Topic 270: Interim Reporting
ASC Codification Topic 272: Limited Liability Entities
ASC Codification Topic 274: Personal Financial Statements
ASC Codification Topic 275: Risks and Uncertainties
 
ASC Codification Topic 280: Segment Reporting


   U.S. GAAP Codification of Accounting Standards
Accounting Standards Codification, ASC, Overview
ASC Codification 200: Presentation
ASC Codification 300: Assets
ASC Codification 400: Liabilities
ASC Codification 500: Equity
ASC Codification 600: Revenue
ASC Codification 700: Expenses
ASC Codification 800: Broad Transactions
ASC Codification 900: Industry

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