Cash Flow Statement Analysis

Question 1

Operating

Answer 1

• Revenues and expenses
• changes in current assets
• changes in current liabilities

Question 2

Investing

Answer 2

Changes in non current assets

Question 3

Financing

Answer 3

• Changes in non current liabilities

- Changes in Equity

Question 4

Indirect Operations Cash Flow

Answer 4

Net Income
+ depreciation & Amortisation
+Net Loss / -Net gain on sale of long term assets
+decreases / -increases in current assets
+increases / -decreases in current liabilities

Question 5

Exceptions Cash Flow Operations

Answer 5

Current assets do not include cash

Current liabilities do not include short term debt

Question 6

Direct way to calculate CFO

Answer 6

Start from 0
\+receipts from customers
\+interest receipts from debtors
-payments to suppliers
-payments to employees
-Interest payments to creditors
-payments to tax authorities

Question 7

Cash Flow Investing

Answer 7

• Increase / +decrease in PPE + depreciation
• increase / + decrease in investment
• increase / + decrease notes receivable
• Net Loss / + Net Gain on sales of long term assets

Question 8

Cash Flow Financing Activities

Answer 8

+ New Borrowing / - Debt Repayment
+ Increase / - Decrease in Share Capital
- dividends

Question 9

Old and new cash

Answer 9

\+CFO
\+CFI
\+CFF
= Change in C & CE
(+cash in 2019)
= cash in 2020