西方财务-15

Chapter15StatementOfCashFlowsPurposeofthestatementofcashflowsToprovideinformationaboutthecashreceiptsandcashpaymentsofanentityduringaperiodToprovideinformationabouttheinvestingandfinancingactivitiesofanentityduringaperiodWiththehelpofthestatementofcashflowswecangetsomeimportantinformationabouttheproblemlistedbelow:Wheredidthecashcomefrom?Whatwasthecashusedfor?Whatwasthechanginthecashbalance?CashequivalentsHighlyliquidshort-terminvestments,suchasTreasurybill,moneymarketfunds,andcommercialpaper.Forpurposeofpreparingastatementofcashflows,moneyheldincashequivalentsisstillviewedas“cash.”Toqualifyasacashequivalent,aninvestmentmustbeverysafe,haveaverystablemarketvalue,andmaturewithin90daysofthedateofacquisition.ClassificationofcashflowsInvestingCashinflowsFromSaleofproperty，plant，andequipment．Fromsaleofdebtorequitysecuritiesofotherentities，Fromcollectionofprincipalonloanstootherentities，CashoutflowsTopurchaseproperty，plant，andequipment．Topurchasedebtorequitysecuritiesofotherentities．Tomakeloanstoanotherentity．FinancingCashinflowsFromsaleofequitysecurities．FromissuanceOfdebt(bondsandnotes)．CashoutflowsTOShareholdersasdividends．TOredeemlong—termdebtorreacquirecapitalstock．Note:Receiptsandpaymentsofinterestareoperatingactivities.Receiptsofdividendsareoperatingactivities.Paymentsofdividendsarefinancingactivities.OperatingCashinflowsFromsaleOfgoodsorservices．Fromreturnsonloans(interest)andonequitysecurities(dividends)CashoutflowsTOsuppliersforinventory．TOemployeesforservices．TOgovernmentfortaxes，T0lendersforinterest，TOothersforexpenses，PreparationofthestatementThesourceofinformationcomparativebalancesheetscurrentincomestatementselectedtransactiondataMajorstepsDeterminethechangeincashDeterminecashprovidedbyoperationsDeterminecashfrominvestingandfinancingactivitiesIllustration(textbook)DeterminecashprovidedbyoperationsAccrualbasisCashbasisNetincomeEarnedrevenuesIncurredexpensesCashprovidedbyoperationsEliminatenoncashrevenuesEliminatenoncashexpensesDifferencesbetweennetincomeandnetcashflowfromoperatingactivitiesNoncashexpenseTimingdifferencesNonoperatinggainsandlosses1.Noncashexpenses:thatreducenetincomebutdonotrequireanycashoutlayduringthecurrentperiod.DepreciationexpenseAmortizationofintangibleassetsDepletionofnaturalresourcesAmortizationofbonddiscount2.Timingdifference:revenueandexpensesmayberecognizedinadifferentaccountingperiodfromtherelatedcashflows.Changesinaccountsreceivablechangesininventorychangesinprepaidexpensechangesinaccountspayablechangesinaccruedexpensespayable3.Nonoperatinggainsandlosses:accordingitsdefinition,nonoperatinggainsandlossesdonotaffectoperatingactivities.however,thesegainandlossesdoenterintothedeterminationofnetincome.Therefore,inconvertingnetincometonetcashflowfromoperatingactivities,weaddbackanynonoperatinglossesanddeductanynonoperatinggainsincludedinnetincome.Nonoperatinggainsandlossesincludegainsandlossesfromsalesofinvestments,plantassets,anddiscontinuedoperations(whichrelatetoinvestingactivities);andgainsandlossesonearlyretirementofdebt(whichrelatetofinancingactivities).TwomethodsareusedtoadjustthenetincometocashprovidedbyoperatingactivitiesDirectapproachIndirectapproachDirectmethod:Amethodofreportingnetcashflowfromoperatingactivitiesbylistingspecifictypesofcashinflowsandoutflows.Indirectmethod:Aformatofreportingnetcashflowfromoperatingactivitiesthatreconcilesthisfigurewiththeamountofnetincomeshownintheincomestatement.Theindirectmethod:theadjustmentstonetincomearesummarizedinthefollowingdiagram:Netincomeadd:depreciationdecreaseinaccountsreceivabledecreaseininventoriesdecreaseinprepaidexpensesincreaseinaccountspayableincreaseinaccruedexpensepayableincreaseindeferredincometaxespayableNonoperatinglossesdeductedincomputingnetincomededuct:increaseinaccountsreceivableincreaseininventoriesincreaseinprepaidexpensesdecreaseinaccountspayabledecreaseinaccruedexpensepayableNonoperatinggainsincludedinnetincomeNetcashflowfromoperatingactivitiesCashflowsfrominvestingactivitiesPurchasesandsalesofsecuritiesloansmadeandcollectedcashpaidtoacquireplantassetsproceedsfromsalesofplantassetsCashflowsfromfinancingactivitiesShot-termborrowingactivitiesproceedsfromissuingbondspayableandcapitalstockandrepaymentofdebtcashdividendspaidtostockholdersIllustration(textbook)