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Fund Flow


Presented By:
Priyanka Lawate
Roll No. 59
Fund + Flow = Fund Flow
 Fund:-
Cash Resources
The equivalent of the sum total of cash &
marketable securities

 Flow:-
Conversion or transfer of economic values from
one asset to another, from equity of one type
to another, from one asset to equity, or vice-
versa, or combination of these.
Movement of funds between two balance sheet

Fund Flow Analysis
It consist of two different analysis:-
 Working Capital analysis
 Cash Flow Analysis
Working Capital is the excess of current asset over
current liabilities.
This analysis include two separate statements:

1.Statement of changes in Working Capital

2.Statement of Sources & Applications of funds
Cash flow analysis is the analysis of inflow & out flows
of cash.
Cash flow analysis results in separate report:

 i.e. Sources & Application of cash

Step 1:
 Schedule of Changes in
Working Capital
Particulars Previous Current Changes Changes
Year Year in in
Rs. Rs. Working Working
Capital Capital
A. Current Assets: Increase Decrease
Stock Rs. Rs.
Prepaid Expenses
Total (A)
B.Current Liabilities:
Bills Payable
Outstanding Exp.
Bank Overdraft
Total (B)
Working Capital (A-B)
Working Capital
Step 2:
 Inflow or outflow from Non-
Current Items
Step 3:
 Find Out Fund from Operation
Rs. Rs. Rs.
Sales xx
Other Operating Revenues Xx
Less: Total Operating Cost
(Other than Depreciation)

 Cost of Goods Sold: xx

Opening Stock xx
Direct Expenses xx
Less: Closing Stock xx xx
(b) Office & Administration
(Including outstanding but xx
excluding prepaid)
Selling & Distribution Expenses
(Including outstanding but
excluding prepaid) xx xx
Fund from Operations xx
Step 4:
 Prepare Fund Flow Statement
Fund Flow Statement
Sources Rs. Applications Rs.

Sources of Funds: Application of Funds:

Funds from operations Purchase of Fixed Assets
Sale of Fixed Assets Redemption of Preference
Issue of Shares Share
Issue of Debentures Redemption of
Loan taken Debentures
Payment of Taxes
Decrease in Working Payment of Dividend
Capital Repayment of Loans
Increase in Working