Format of Cash Flow Statement
Format of Cash Flow Statement
Net Profit after Tax( difference between closing and opening bal of surplus account) X
Add: Transfer to reserves ( Gen reserve, DRR) x
Dividend paid during the year (last years proposed dividend) x
Interim dividend paid during the year x
Provision for tax made for the current year( closing bal current year ) x
Final dividend paid x
loss on stock /natural disaster/ fire/ theft x X
Less: Income Tax refund x
Insurance claim/ compensation received x X
Profit before tax and extra ordinary items XX
Add: Non Cash and Non operating Expenses x
Depreciation of Assets x
Amortization of Goodwill/ Patents x
Fictitious assets written off x
Loss on sale of Fixed assets/ investments x
Interest paid on Debentures , bank overdraft, cash credit x
Increase in prov for doubtful debts x
Underwriting commission/discount on issue of debentures w/off x
Expenses on Issue of shares/ Preliminary expenses x X
Less: Non Operating Income
Rental income x
Interest received in investments x
Dividend received on investments x
Profit on sale of assets x
Decrease in provision for doubtful debts x X
Operating Profit/loss before working capital changes XX
Add: Decrease in Current Asset and Increase in current liability x
Less: Increase in Current asset and Decrease in Current liability x
XX
Less: Tax paid during the year x
Cash Flow from Operating Activities ……………..( A ) XXX
Cash Flow from Investing Activities ( Fixed assets / noncurrent investments )
Add : Cash inflow
Proceeds from sale of Asset x
Interest received on Long Term Investments x X
This study material is created by Ms. Leena Khatri +971508630043
Note :
1) Always prepare account for provision of tax, accumulated depreciation , and fixed assets account if any
information is given in adjustment
2) If insurance claim is given in the additional information then add loss due to natural disaster in
operating activities and minus insurance claim received in operating activities
3) Adjustments will always have 2 effects only will be in Operating activity and other in respective
investing or finance activity
4) If no information is given regarding date of investment interest is always calculated on opening balance
5) Proposed dividend as on 31st March 2023 and 2024 are 2,10,000 and
2,50,000 respectively.( add 210000 in operating activity and minus in finance activity 210000)
6) When tax paid is given in adjustment ( Case 1)
PROVISION FOR TAX A/C
To tax paid 20000 By bal B/d 100000
To bal C/d 130000 By P/l adjustment(Bal fig ) 40000
(add in operating activity)
This study material is created by Ms. Leena Khatri +971508630043
(CASE 2 when only opening and closing amount of tax is given in Balance sheet and there is no
information of tax paid) PROVISION FOR TAX A/C