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Cash Flow Statement (a) Financial Accounting Foundation (65) ? Cash Flow Statement (a) ? First, the concept of cash flow statement Cash flow statement reflects a certain period of corporate cash and cash equivalents inflow and outflow of financial statements. Cash flow statement reflects a period of time &quot;cash&quot; income and expenditure total aggregate number of specific circumstances, as with the income statement, it is the dynamic statements. Cash flow statement in the &quot;Cash&quot; means cash and corporate stock can be used to pay the deposit at any time, including the &quot;Cash&quot; account cash accounting; &quot;bank&quot; accounts of enterprises accounting for the payment of the deposit at any time; &quot;other monetary funds&quot; account of the other ports deposit accounts, bank deposits, money orders, cashier deposits, money in transit funding and other monetary funds, and cash equivalents. Cash equivalents, is the holding period for the short (usually three months), highly liquid, readily convertible to known amounts of cash, a small risk of changes in the value of the investment. Cash equivalents, though not in cash, but its ability to pay with cash, little difference could be regarded as cash, generally in the &quot;trading financial assets&quot; account accounting. For example, corporate-owned, may be in circulation in the securities market, short-term debt due within three months of investment. The amount of equity investment is usually realized uncertain, therefore it is not cash equivalents. (The following references to &quot;cash&quot;, unless the same time reference equivalents, or both, including cash and cash equivalents.) Cash flow reflects a certain accounting period of corporate cash and cash equivalents of inflows and outflows. Business from the banks to withdraw cash, use cash to buy Treasury bills and other short-term maturity of the conversion between the cash and cash equivalents are not cash flow. Second, the role of cash flow statement Cash flow statement purpose is to provide users of accounting statements 企业 会计 some of the cash and cash equivalents Liuru information to statement users to understand and evaluate companies ability to obtain cash, and according to predict enterprise future cash flows. Market economy, business and cash flow to a large extent affect the survival and development of enterprises. Cash-rich companies may in time acquire the necessary materials, business supplies, fixed assets, the timely payment of wages due to repay debt, pay dividends and interest; the other hand, at worst affect the normal production and business activities, while in threatening the survival of enterprises . An &quot;Company Law&quot; provision, Gong Si can not repay debts due, shall be the statutory procedures was declared bankrupt by the court provided in law, organizational shareholders, the relevant agencies and related professionals establish a liquidation group, the company liquidation . Corporate cash management has become an important aspect of financial management by business managers, investors, creditors and government regulatory concerns. The role of the cash flow statement, can be summarized as the following four aspects. (A) of the cash flow statement will help evaluate the enterprise&#39;s ability to pay, solvency and liquidity. Through the cash flow statement and balance sheet and income statement with the cash and current liabilities compared to figure ratios; to net cash flow and outstanding common shares compared the weighted average number of shares to calculate the cash per share flow; the net operating cash flow compared with net income, calculate the profit in cash rate, we can understand the cash could maturing debt, pay dividends and make the necessary investment in fixed assets, to understand the efficiency and effectiveness of business cash flow , etc., to help investors to make investment decisions, creditors make credit decisions. (B) of the cash flow statement can help to predict future cash flow business. Evaluation of the past is to predict the future. Tong Guo corporate cash flow statement reflects cash flow past a certain period, and other Economic Indicators, you can understand the sources and uses of corporate cash is reasonable to understand the cash flow generated from operating activities how much business the extent to which reliance on external funding, enterprise can predict the future, according to the cash flow to cash flow for the enterprises to plan, organize cash scheduling, reasonable use of the cash economy and create conditions for investors and creditors to evaluate the enterprise&#39;s future cash flows, make the necessary investment and credit decisions information. (C) cash flow analysis of corporate earnings helped the quality and the factors that affect net cash flows. Income statement shows the net profit target, reflecting a company&#39;s operating results in a certain period, which is reflected the most important business performance indicators. However, a profit-making enterprises may not have ample cash to repay debt and pay for the goods meet the daily business activities such as cash expenses, because the income statement is prepared in accordance with accrual principles, it does not reflect the number of business activities cash, and do not reflect the investment activities and financing activities, cash on corporate finance activities. Through the cash flow statement, you can master the business activities, investment activities and financing activities, cash flow, the cash flow generated from operating activities, compared with net income, we can understand from the perspective of net cash flow quality, and further determine what factors affect the cash flow, so as to analyze and judge the company&#39;s financial outlook information. (D) cash flow statement, to facilitate coordination with the international practice. Currently, many countries require enterprises to produce cash flow, such as the United States, Britain, Australia and Canada. Coordination with international practice, China&#39;s enterprises also have a cash flow statement, the move will be to carry out cross-border operations, foreign financing, strengthened to play an active role in international economic cooperation. Third, the basic structure of the cash flow statement China&#39;s &quot;Accounting Standards for Enterprises No. 31 - Cash Flow Statement,&quot; provides that the cash flow statement is divided into tables of Chinese enterprises first, are tables and supplementary information of three parts. The first name of the table, including statements, organizational units, the preparation period, the amount of units and so on. Is the main table is the cash flow statement and core. Cash flow statement is cash flow table will be divided into three areas: (A) cash flow from operating activities. Business activities, is the corporate investment activities and financing activities outside of all transactions and issues. In addition to investment that is attributable to the activities and financing transactions and other matters can all belong to business activities. Obtained from the operating activities occurred in the cash income and cash expenditures constitute the cash flow from operating activities. As the characteristics of different industries, different types of businesses identified the scope of business activities vary. Cash flows from operating activities projects generally include: selling goods or rendering of services received in cash, received the tax return, received from other operating activities cash. Cash outflow from operating activities mainly include: purchase of goods, receiving a cash payment of staff salaries, fees and related income tax to pay taxes, pay for advertising costs, paid for other operating activities cash. (B) Cash flow from investing activities. Investment activities, is the corporate long-term assets (or assets) of the purchase and construction are not included in cash equivalents, investments and disposal within the scope of activities. Here the long-term assets consist primarily of fixed assets, construction in progress, intangible assets and other long-term assets. To note the investment activity and investment are two different concepts, investment is divided into short-term investment and long-term investment, acquisition of fixed assets is the investment activity, but an investment in Bushi; 购买 bonds maturing within three months short-Shu Yu investment, but it is not investment. Obtained by the investments of cash income or cash payments in place constitute the cash flow from investing activities. Cash flows from investing activities items generally include: return on investment of cash received and achieved investment income received in cash, fixed assets, intangible assets and other long-term assets, the cash received, received from other investing activities the cash. Cash outflow from investing activities mainly include: purchase of fixed assets, intangible assets and other long-term assets to pay cash, investments, cash payments, payments to other investing activities cash. (C) Cash flow from financing activities. Financing activities, is the leading venture capital and debt size and composition changes in activities. Capital mentioned here, including the paid-up capital (equity), including capital premium (equity premium); here said the external debt is debt, including loans to banks to issue bonds. However, accounts payable, notes payable and other business activities are not part of fund-raising activities, does not include the debt mentioned in this list. Financing obtained by the cash income and cash occurred in the composition of spending the cash flow from financing activities. Cash flows from financing activities generally include the project: from investments in cash, the cash received from borrowings, other financing activities received the cash. Cash outflow from financing activities mainly include: paid cash to repay debt, distribution of profits, dividends or interest payments paid in cash, paid for other financing activities cash. ?
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