Allow companies to omit the statement of cash flows from a complete set of finan

Question

Allow companies to omit the statement of cash flows from a complete set of financial statements if cash is an insignificant asset. Require that companies omit the statement of cash flows from a complete set of financial statements if the company has no investing activities. Require that companies include a statement of cash flows in a complete set of financial statements. Allow companies to include the statement of cash flows in a complete set of financial statements if the cash balance makes up more than 50% of the current assets. Allow companies to omit the statement of cash flows from a complete set of financial statements if the company has no financing activities.

Explanation / Answer

Accounting standard

requires that companies include a statement of cash flows in a complete set of financial statements.

Under IFRS, no entity is exempted from providing cash flows as a part of the financial statements of the entity.

Under US GAAP, as per ASC 230, as defined benefit pension plans and certain other employee benefit plan represent the financial information in accordance with the relevant guidelines issued by ASC 230, these plans are not required to present the cash flow statements. The highly liquid investment companies conforming to all the relevant conditions compiled by ASC 230 for this purpose, do not require to prepare the cash flow statements as a pert of their financial statements. Except these, all other companies will have to include a cash flow statement in a complete set of financial statements.

Related Questions

Navigate

• Browse (All)
• Browse A
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.