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  • Funds Flow Statement

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    This document provides steps to prepare a funds flow statement. It begins by preparing a statement of changes in working capital, which is current assets minus current liabilities. An increase in current assets or decrease in current liabilities increases working capital. Next, non-operating income and expenses are added or deducted from profits to calculate funds from operations. Finally, a funds flow statement is prepared with sources, such as decreases in long-term assets, and applications, like increases in long-term liabilities. Current and long-term assets and liabilities are also defined. The document encourages developing social entrepreneurship programs to help society.

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    This document provides steps to prepare a funds flow statement. It begins by preparing a statement of changes in working capital, which is current assets minus current liabilities. An increase in current assets or decrease in current liabilities increases working capital. Next, non-operating income and expenses are added or deducted from profits to calculate funds from operations. Finally, a funds flow statement is prepared with sources, such as decreases in long-term assets, and applications, like increases in long-term liabilities. Current and long-term assets and liabilities are also defined. The document encourages developing social entrepreneurship programs to help society.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PPS, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    332 views13 pages

    Funds Flow Statement

    Uploaded by

    api-26674800
    This document provides steps to prepare a funds flow statement. It begins by preparing a statement of changes in working capital, which is current assets minus current liabilities. An increase in current assets or decrease in current liabilities increases working capital. Next, non-operating income and expenses are added or deducted from profits to calculate funds from operations. Finally, a funds flow statement is prepared with sources, such as decreases in long-term assets, and applications, like increases in long-term liabilities. Current and long-term assets and liabilities are also defined. The document encourages developing social entrepreneurship programs to help society.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PPS, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    of 13

    How to prepare funds

    flow statement
    Dr. T.K. Jain.
    AFTERSCHOOOL
    M: 9414430763
    tkjainbkn@yahoo.co.in
    www.afterschool.tk
    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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