Archive | Funds Flow Statement

Funds flow statement reflects the change in working capital during a period through those transactions which affect the funds - termed as 'cross transactions'. The change is shown as a 'consolidated figure'. However it is preferable to prepare the 'working capital statement' which shows the complete details of the contribution of each item of current asset and current liability towards [...]

'Flow' means change. 'Funds' is interpreted as' working capital' in the context of funds flow statement. Thus, 'Funds flow' is 'change in working capital'. Flow of funds implies any changes in working capital. These changes are a continuous process, day after day, as and when transactions take place. So, the changes in working capital may be called 'Flow'. It can [...]