Cash Flow

Statement of Cash Flows Indirect Method

Indirect Method of Cash flow Statement

Indirect Method Cash Flow Statement

In indirect method of cash flow statement, the statement is begin by recording the net income from income statement and makes adjustments to it for non cash transactions and non operating items to arrive at the net operating cash flow.

The reporting of cash flows in indirect method is representing under this table:

 

Net income
+ Non-cash expenses
+ Increase in current liabilities
+ Decrease in current assets
Increase in current assets
Decrease in current liabilities
Gain from investing & financing activities
+ Loss from investing & financing activities
= Cash flow from operating activities