Funds Flow Statement
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How to prepare funds flow statement Dr. T.K. Jain. AFTERSCHOOOL M: 9414430763 [email protected] www.afterschool.tk www.afterschoool.tk
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www.afterschoool.tk social entrepreneurship for better society
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First step – prepare statement of changes in working capital • Working capital: • Current assets – current liabilitites • Remember – increase in current assets will increase working capital and decrease in current assets will decrease working capital
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S.W.C. • Remember – increase in current liabilities will decrease working capital and decrease in current liabilities will increase working capital
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STEP II – PREPARE FUNDS FROM OPERATIONS • Add back all non operating expenses to profit • Deduct all non operating income from profits. • Non-operating expenese include: depreciation, loss on sale of any assets, abnormal loss, any other loss not due to business, amortisation of patent
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Non operating income • These include income from divident,interest,income from other sources – other than business. • These include some exceptional income also.
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STEP III- PREPARE FUNDS FLOW STATEMENT • There are two heads – sources and applications • Sources – increase in long term liability or decrease in long term assets. • Application -decrease in long term liability or increase in long term assets.
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What are current assets? • Which you will use in next one year – • For example cash,inventory, debtors, BR (bill receivable), prepaid expenses, etc.
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Current liability • Include BP (bill payable), ,CREDITORS, bank overdraft • Provisions • Amount payable • Outstanding expenses
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Long term assets • Building, plant, land, machinery, furniture, patent, investment etc.
www.afterschoool.tk
Long term liability • Loan, capital, debenture, bonds, preference share capital etc.
www.afterschoool.tk
Thanks Afterschoool conducts three year integrated PGPSE (after class 12 along with CA & CS) and 18 month PGPSE (Post Graduate Programme in Social Entrepreneurship) along with preparation for CS / CFP / CFA /CMA / FRM. This course is also available online also. It also conducts workshops on social entrepreneurship in schools and colleges all over India – start social entrepreneurship club in your institution today with the help from afterschoool and help us in developing society.
www.afterschoool.tk
www.afterschoool.tk social entrepreneurship for better society
www.afterschoool.tk
www.afterschoool.tk
www.afterschoool.tk social entrepreneurship for better society
www.afterschoool.tk
First step – prepare statement of changes in working capital • Working capital: • Current assets – current liabilitites • Remember – increase in current assets will increase working capital and decrease in current assets will decrease working capital
www.afterschoool.tk
S.W.C. • Remember – increase in current liabilities will decrease working capital and decrease in current liabilities will increase working capital
www.afterschoool.tk
STEP II – PREPARE FUNDS FROM OPERATIONS • Add back all non operating expenses to profit • Deduct all non operating income from profits. • Non-operating expenese include: depreciation, loss on sale of any assets, abnormal loss, any other loss not due to business, amortisation of patent
www.afterschoool.tk
Non operating income • These include income from divident,interest,income from other sources – other than business. • These include some exceptional income also.
www.afterschoool.tk
STEP III- PREPARE FUNDS FLOW STATEMENT • There are two heads – sources and applications • Sources – increase in long term liability or decrease in long term assets. • Application -decrease in long term liability or increase in long term assets.
www.afterschoool.tk
What are current assets? • Which you will use in next one year – • For example cash,inventory, debtors, BR (bill receivable), prepaid expenses, etc.
www.afterschoool.tk
Current liability • Include BP (bill payable), ,CREDITORS, bank overdraft • Provisions • Amount payable • Outstanding expenses
www.afterschoool.tk
Long term assets • Building, plant, land, machinery, furniture, patent, investment etc.
www.afterschoool.tk
Long term liability • Loan, capital, debenture, bonds, preference share capital etc.
www.afterschoool.tk
Thanks Afterschoool conducts three year integrated PGPSE (after class 12 along with CA & CS) and 18 month PGPSE (Post Graduate Programme in Social Entrepreneurship) along with preparation for CS / CFP / CFA /CMA / FRM. This course is also available online also. It also conducts workshops on social entrepreneurship in schools and colleges all over India – start social entrepreneurship club in your institution today with the help from afterschoool and help us in developing society.
www.afterschoool.tk
www.afterschoool.tk social entrepreneurship for better society
www.afterschoool.tk
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