operating activities are the main revenue-producing activities of the entity that are not investing or financing activities, so operating cash flows include cash received from customers and cash paid to suppliers and employees.Key principles specified by IAS 7 for the preparation of a statement of cash flows are as follows: Presentation of the Statement of Cash FlowsĬash flows must be analysed between operating, investing and financing activities. Bank overdrafts which are repayable on demand and which form an integral part of an entity's cash management are also included as a component of cash and cash equivalents. preferred shares acquired within three months of their specified redemption date). Equity investments are normally excluded, unless they are in substance a cash equivalent (e.g. Guidance notes indicate that an investment normally meets the definition of a cash equivalent when it has a maturity of three months or less from the date of acquisition. Cash and cash equivalents comprise cash on hand and demand deposits, together with short-term, highly liquid investments that are readily convertible to a known amount of cash, and that are subject to an insignificant risk of changes in value. The statement of cash flows analyses changes in cash and cash equivalents during a period. Fundamental principle in IAS 7Īll entities that prepare financial statements in conformity with IFRSs are required to present a statement of cash flows. The objective of IAS 7 is to require the presentation of information about the historical changes in cash and cash equivalents of an entity by means of a statement of cash flows, which classifies cash flows during the period according to operating, investing, and financing activities. IAS 7 amended by Annual Improvements to IFRSs 2009 with respect to expenditures that do not result in a recognised asset.Įffective date for amendments from IAS 27(2008) relating to changes in ownership of a subsidiaryĮffective date of the April 2009 revisions to IAS 7Īmended by Disclosure Initiative (Amendments to IAS 7)Įffective date of the January 2016 revisions to IAS 7Īmended by Supplier Finance Arrangements (Amendments to IAS 7 and IFRS 7)Įffective date of the May 2023 revisions to IAS 7Īmendments under consideration by the IASB Retitled from Cash Flow Statements to Statement of Cash Flows as a consequential amendment resulting from revisions to IAS 1 IAS 7 Statement of Changes in Financial Position IAS 39 - Financial Instruments: Recognition and MeasurementĮxposure Draft E7 Statement of Source and Application of Funds.IAS 37 - Provisions, Contingent Liabilities and Contingent Assets.IAS 35 - Discontinuing Operations (Superseded).IAS 32 - Financial Instruments: Presentation.IAS 30 - Disclosures in the Financial Statements of Banks and Similar Financial Institutions.IAS 29 - Financial Reporting in Hyperinflationary Economies.IAS 28 - Investments in Associates (2003).IAS 28 - Investments in Associates and Joint Ventures (2011).IAS 27 - Consolidated and Separate Financial Statements (2008).IAS 27 - Separate Financial Statements (2011).IAS 26 - Accounting and Reporting by Retirement Benefit Plans.IAS 22 - Business Combinations (Superseded).
IAS 21 - The Effects of Changes in Foreign Exchange Rates.IAS 20 - Accounting for Government Grants and Disclosure of Government Assistance.IAS 19 - Employee Benefits (1998) (superseded).IAS 15 - Information Reflecting the Effects of Changing Prices (Withdrawn).
IAS 1 - Presentation of Financial Statements.
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