55
Accounting Standard (AS) 3
(revised 1997)
Cash Flow StatementsContents
OBJECTIVESCOPE Paragraphs 1-2BENEFITS OF CASH FLOW INFORMATION 3-4DEFINITIONS 5-7Cash and Cash Equivalents
6-7
PRESENTATION OF A CASH FLOW STATEMENT 8-17Operating Activities
11-14
Investing Activities
15-16
Financing Activities
17
REPORTING CASH FLOWS FROM OPERATINGACTIVITIES 18-20REPORTING CASH FLOWS FROM INVESTING ANDFINANCING ACTIVITIES 21REPORTING CASH FLOWS ON A NET BASIS 22-24FOREIGN CURRENCY CASH FLOWS 25-27EXTRAORDINARY ITEMS 28-29INTEREST AND DIVIDENDS 30-33TAXES ON INCOME 34-35
Continued../..
56
INVESTMENTS IN SUBSIDIARIES, ASSOCIATES ANDJOINT VENTURES 36ACQUISITIONS AND DISPOSALS OF SUBSIDIARIESAND OTHER BUSINESS UNITS 37-39NON-CASH TRANSACTIONS 40-41COMPONENTS OF CASH AND CASH EQUIVALENTS 42-44OTHER DISCLOSURES 45-48APPENDICES
C ash F low S tatem ents
53
Accounting Standard (AS) 3*
(revised 1997)
Cash Flow Statements
(This Accounting Standard includes paragraphs set in
bold italic
typeand plain type, which have equal authority. Paragraphs in bold italic typeindicate the main principles. This Accounting Standard should be read inthe context of its objective and the Preface to the Statements of AccountingStandards
1
.)
AccountingStandard (AS) 3,
‘Cas
h Flow Statements
’
(revised 1997), issuedby the Council of the Institute of Chartered Accountants of India, comesinto effect in respect of accounting periods commencing on or after1-4-1997. This Standard supersedes Accounting Standard (AS) 3,
‘Changes
in Financial
Position’
, issued in June 1981. This Standard is mandatory innature
2
inrespectofaccountingperiodscommencingonorafter1-4-2004
3
forthe enterprises which fall in any one or more of the following categories, atany time during the accounting period:(i) Enterprises whose equity or debt securities are listed whether inIndia or outside India.
*The Standard was originally issued in June 1981 and was titled
‘Changes
in Financial
Position’.
1
Attention is specifically drawn to paragraph 4.3 of the Preface, according to whichAccounting Standards are intended to apply only to items which are material.
2
Reference may be made to the section titled
‘Announcements
of the Council regardingstatus of various documents issued by the Institute of Chartered Accountants of
India’
appearing at the beginning of this Compendium for a detailed discussion on theimplications of the mandatory status of an accounting standard.
3
AS 3 was originally made mandatory in respect of accounting periods commencingon or after 1-4-2001, for the following:(i) Enterprises whose equity or debt securities are listed on a recognised stock exchange in India, and enterprises that are in the process of issuing equity ordebt securities that will be listed on a recognised stock exchange in India asevidenced by the board of
directors’
resolution in this regard.(ii) All other commercial, industrial and business reporting enterprises, whoseturnover for the accounting period exceeds Rs. 50 crores.The relevant announcement was published in
‘The
Chartered
Accountant’,
December2000, page 65.
of 00
As 3
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