Reflections upon the statement of cash flow and ideas for its presentation using the direct method
In order to carry out financial projections and analysis, the information contained in the statement of cash flow should be supplemented by the analysis of the balances of related operating assets and liabilities, which is why the method selected to prepare the statement becomes relevant.If the dire...
Guardado en:
| Autores principales: | , , , |
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| Formato: | Artículo revista |
| Lenguaje: | Español |
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Ediciones UNL
2017
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| Materias: | |
| Acceso en línea: | https://bibliotecavirtual.unl.edu.ar/publicaciones/index.php/CE/article/view/6899 |
| Aporte de: |
| Sumario: | In order to carry out financial projections and analysis, the information contained in the statement of cash flow should be supplemented by the analysis of the balances of related operating assets and liabilities, which is why the method selected to prepare the statement becomes relevant.If the direct method is used for the presentation of the cash flow, the reading and understanding of the statement by the user is simple, but it is not sufficient for the analysis of the link between the result and the generation of funds of the period – a fundamental aspect for making financial projections. The presentation using the indirect method can also show such connection, but it is difficult to understand it. In this paper, we propose two alternatives to present the statement by the direct method, which consolidate the advantages of its traditional version with those of the indirect method. The proposals include the disclosure of information in the body of the accounting statement or in a supplementary note, describing in detail how the different types of inflows and outflows of cash that are exposed by the direct method are determined, based on the accrued results, and considering the increases or decreases of related operating assets and liabilities.The direct method favors the vertical and horizontal analysis of thecash flow statement over two or more periods. The information that can be obtained by calculating ratios that link the different subtotals of this statement and some of the income statement also proves to be useful. |
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