IAS 7 Statement of Cash Flows
International Accounting Standard 7
Overview of IAS 7
- Issued: in 1977; re-issued in 1992, followed by amendments
- Effective date: 1 January 1994
- What it does:
- It requires the presentation of changes in cash and cash equivalents in the form of statement of cash flows;
- It defines cash and cash equivalents and explains what is and what is NOT included in cash flow movements.
- It classifies the cash flows as either from operating, investing or financing activities.
- It requires reporting cash flows from operating activities either by direct or indirect method.
- In relation to reporting cash flows from investing and financing activities, IAS 7 asks to report gross receipts and payments with several exceptions where net basis is allowed.
- It also deals with several specific transactions, such as foreign currency cash flows, interest and dividends, taxes on income, investments in subsidiaries, associates and joint ventures, changes in ownership interests in subsidiaries and other businesses, non-cash transactions etc.
Articles about IAS 7
- Summary of IAS 7 Statement of Cash Flows
- Consolidated statement of cash flows with foreign currencies -here, you can find the full step by step explanation of making consolidated statement of cash flows when a parent and subsidiary have different functional currencies.
- How to Prepare Statement of Cash Flows in 7 Steps - learn to make the statement yourself while using systematic method, error-free.
Questions and Answers
- How to present restricted cash under IAS 7 - if you are limited in using your cash, how should you present it?
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