WHAT'S NEW?

FINANCIAL MARKET COURSES

Analysis of the Cash Flow Statement

Using balance sheets and income statements, accountants are able to draw up cash flow statements that detail the areas where cash is being generated and ‘burned’ by a business. This is of crucial importance as it gives the users of accounts essential ‘supplementary’ information on which to base their decisions. The cash flow statement, while not a headline accounting statement, details how well cash is being managed and focuses the investment mind on the adage that ‘cash is king’.

 

This course explains the important difference between cash and profit. It also shows how to classify activities in a cash flow statement and how to prepare and interpret such statements. The limitations of cash flow statements are also explained, in addition to the relationship between working capital and cash flow.

  • OBJECTIVES

    On completion of this course, you will be able to:

    Identify the importance of cash to a business

    Prepare a cash flow statement

    Interpret a cash flow statement

    Identify how entities can maintain a strong liquidity position with proper working capital management

  • COURSE OUTLINE

    Topic 1: Working Capital and Cash Flow

    Maintaining the Working Capital

    Symptoms of Poor Working Capital Management

    Working capital & Cash Flow

    Managing Accounts Receivable

    Managing Accounts Payable

    Managing Inventory

    Managing Cash

    Topic 2: An Overview of the Cash Flow Statement

    Cash vs. Profit

    Cash Flow Statement – Activities

    Structure of Cash Flow Statement

    Uses of the Cash Flow Statement

    Limitations of a Cash Flow Statement

    Topic 3: Interpreting a Cash Flow Statement

    Cash Flow Statement Ratios

    o Quality of Operating Income

    o Operating Cash Flow Ratio

    o Cash Flow to Asset Ratio

    o Cash Current Debt Coverage

    o Cash Flow per Share

    Topic 4: Preparing a Cash Flow Statement

    Methods for Preparing a Cash Flow Statement

    o Direct Method

    o Indirect Method

  • PREREQUISITE KNOWLEDGE

  • ESTIMATED COMPLETED TIME

    75 Minutes

Next Course

VIEW COURSE

INTRODUCTORY

Support

Accreditations

General: info@intuition.com

Accounts: ar@intuition.com

http://support.intuition.com

Intuition engages with over 30 accreditation bodies to ensure Know-How can be used for CPE credits. If your organization needs CPE from a body not listed below, contact us and we will endeavour to have them included.

© Copyright 2016 by Intuition. All Rights Reserved.