Disclosure of Accounting Policies

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4/28/12

Such disclosure form part of financial statements.Accounting Policies • All significant accounting policies should be disclosed. • • • 4/28/12 . Specific disclosure for the adoption of fundamental accounting assumptions is not required. All disclosures should be made at one place.

Fundamental Assumptions • • • Going concern Consistency Accrual 4/28/12 .

Considerations Governing Policies • • • Prudence Substance over form Materiality 4/28/12 .

‘Cash Flow Statements’ Accounting Standard (AS) 3 (revised 1997) 4/28/12 .

§ § 4/28/12 .Objective and Scope § To asses the ability of an enterprise to generate cash and its equivalents Enables enterprises take economic decisions based on the ability to generate cash based on the present value of future cash flows Compare the relationship between profit and cash flows.

Cash equivalents are short term. highly liquid investments that are readily convertible into known amounts of cash and which are subject to an insignificant risk of changes in value.Terms in Cash Flow Statement • Cash comprises cash on hand and demand deposits with banks. 4/28/12 • • • • Cash flows are inflows and outflows .

Cash Flow Statement • Operating activities are the principal revenue-producing activities of the enterprise. Financing activities are activities that result in changes in the size and composition of the owners’ capital 4/28/12 (including preference share capital in • • . Investing activities are the acquisition and disposal of long-term assets and other investments.

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