The cash flow statement simultaneously explains changes in a firm's cash position between balance sheet dates and changes in non-cash accounts. It has three sections: operating, investing, and financing activities. The operating section shows cash effects from core business transactions. The investing section covers cash from buying/selling assets. The financing section includes cash from raising/repaying capital. An example cash flow statement is presented for Maruti Udyog with details on profit, taxes, depreciation, asset purchases, and debt/equity changes.

2. Cash Flow Statement
Presented by –Dayanand Verma
PGDM-III trimester

3. The cash flow statement
simultaneously provides an explanation of
why a firm’s cash position has changed
between successive balance sheet dates
and explains changes that have taken
place in the firm’s noncash
asset, liability, and stockholders’ equity
accounts over the same time period.


4. Sources and
Uses Statement
 The letters labeling the
boxes stand for
Uses, Sources, Assets, an
d Liabilities (broadly
defined). The pluses
(minuses) indicate
increases (decreases) in
assets or liabilities.
A
L
S
-
+
U
+
-

5. Analyzing the Sources and Uses
Statement
Sources
Primarily through
net profit from
operations and
long-term debt
increases.
Uses
Primarily through
an increase in
inventories and
expenditures on
capital assets.

6. Statement of Cash Flows
A summary of a firm’s payments during a period of time.
This statement reports cash inflows and outflows based
on the firm’s
operating activities,
investing activities, and
financing activities.

7. Statement of Cash Flows
Cash Flow from Operating Activities
Shows impact of transactions not defined as
investing or financing activities.
These cash flows are generally the cash effects of
transactions that enter into the determination of
net income.

8. Cash Flow From
Operating Activities
Cash Inflows
From sales of goods or services
From interest and dividend income
Cash Outflows
To pay suppliers for inventory
To pay employees for services
To pay lenders (interest)
To pay government for taxes
To pay other suppliers for other operating
expenses

9. Statement of Cash Flows
Cash Flow from Investing Activities
Shows impact of buying and selling fixed
assets and debt or equity securities of
other entities.
Cash Flow from Financing Activities
Shows impact of all cash transactions with
shareholders and the borrowing and
repaying transactions with lenders.

10. Cash Flow From Investing
Activities
Cash Inflows
From sale of fixed assets (property, plant,
equipment)
From sale of debt or equity securities (other than
common equity) of other entities
Cash Outflows
To acquire fixed assets (property, plant,
equipment)
To purchase debt or equity securities (other than
common equity) of other entities

11. Cash Flow From
Financing Activities
Cash Inflows
From borrowing
From the sale of the firm’s own equity securities
Cash Outflows
To repay amounts borrowed
To repurchase the firm’s own equity securities
To pay shareholders dividends

12. Ratio DataMaruticonsCASHFLOW-STATEMENT-CONSOLIDATEDFINANCIAL-08-09.pdf
C.F.S of Maruti Udyog

13. Cash flow statement
Asset
 PBT- 81 Lacs
 Tax – 27 Lacs
 Cash dividend – 7 Lacs
 Depreciation -20 Lacs
Cash
Receivable
 Fixed asset purchase 220 Lacs ( 150 lacs was Stock
financed through issue
of long term debt)
Net Block
Total
2009
2008Liability
2009
2008
2
Current
10 liability
105
30
60
30
100
Long term
50 debt
150
300
100Net worth
207
160
462
190Total
462
190