A Cash Flow Preparation Guide based on live experience

1. Cash flow StatementPreparation GuideusingIndirect Method By http://www.budgetingforecastingprocess.com

2. Cash flow Statement Preparation Guide by http://budgetingforecastingprocess.com/ Cash Flow Statement Template Net Income Reconciliation to net cash provided (used) by operations Cash provided (used) by Operations Cash provided (used) by Investing Activities Cash provided (used) by Financing Activities Cash provided (used) by Financing Activities Net increase (decrease) in cash and equivalents Cash and equivalents, beginning of the year Cash and equivalents, end of the year

3. Cash flow Statement Preparation Guide by http://budgetingforecastingprocess.com/ Reconciliation to net cash provided (used) by operations General Rules: Deduct increases in noncash current assets. Add decreases in noncash current assets. Deduct decreases in current liabilities. Add loss (or deduct gain) from sale of fixed assets. Add loss (or deduct gain) on extinguishment of debts.

4. Cash flow Statement Preparation Guide by http://budgetingforecastingprocess.com/ Net Income Reconciliation to net cash provided (used) by operations: Income charges not affecting cash. Example: Depreciation Changes in working capital. Example: Inventories Other current assets Account receivables Account payables Accrued liabilities Income taxes, etc Cash provided (used) by Operations

5. Cash flow Statement Preparation Guide by http://budgetingforecastingprocess.com/ Cash provided (used) by Investing Activities Example: Less: Additions to property, plant and equipment. Add: Disposal of property, plant and equipment. Less: Increase in other assets Less: Decrease in other liabilities

6. Cash flow Statement Preparation Guide by http://budgetingforecastingprocess.com/ Cash provided (used) by Financing Activities Example: Add: Additions to long term debt. Less: Reduction in long term debt. Add: Increase in note payables. Add: Proceed from exercise of options. Less: Dividends paid.

7. Cash Flow Statement Templateby http://budgetingforecastingprocess.com/ Net Income Reconciliation to net cash provided (used) by operations Cash provided (used) by Operations Cash provided (used) by Investing Activities Cash provided (used) by Financing Activities Cash provided (used) by Financing Activities Net increase (decrease) in cash and equivalents Cash and equivalents, beginning of the year Cash and equivalents, end of the year

8. By http://www.budgetingforecastingprocess.com The End