The Income statement is a list of all inflows and outflows of economic benefits(revenues and expenses).
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Company Name Income Statement For The Year Ended December 31, xxxx |
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Gross Revenues -Cost of goods sold = Gross Profit -operating expenses =Income from Continuing operations before taxes and special items + other revenues - other expenses -taxes =Income from continuing operations +/- extraordinary items (net of tax) NET INCOME |
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The balance sheet is a list of all a company's assets, liabilities, and owners' equity. |
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Company Name Balance sheet December 31, xxxx |
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ASSETS Current Assets + Fixed (or non-current) Assets =TOTAL ASSETS LIABILITIES Current Liabilities +Long-Term (or non-current) Liabilities =TOTAL LIABILITIES OWNER'S EQUITY Common Stock +Retained Earnings =TOTAL OWNERS EQUITY =TOTAL LIABILITES AND O/E |
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The statement of cash flows is a listing of the inflows and outflows of cash.
It follows the general subdivision of business activity into trying to make money by operating activities, investing activities, and financing activities. Operating activities include the main business that is concentrated on, and paying taxes on this business, as well as interest for liabilities from owning non-current assets such as machinery to run the business. Investing activities include cash used for investment in plant and equipment or recovered from sale of plant or equipment, and money made outside of the main business activity using resources available from the business : this include investing cash available in other investments , receiving cash interest or dividends from continuing other investment. Financial activities are cash activities undertaken when other entities invest in the operations of the main business. So finance activities include cash from issuing shares in the company, cash given as dividends to shareholders, cash from borrowing and cash out due to borrowing repayment.
Hence this derives a list of activities to account for cash flow:
- operating activities - cash from operations : customer receipts, and supplier payments ; cash paid for taxes; cash paid as interest for borrowings to operate plant and equipment.
- investing activities - cash out for purchase plant and equipment, and cash in from sale of these ; cash put in other investments; cash received from dividends received and from interest earned related to running other investments.
- finance activities - cash in from issuing shares, cash out from payment of dividends ; cash in from borrowing money, cash out for repayment of borrowing
A few items are reported as netted if they are sufficiently short term or liquid ( such as other investments, equity shareholding changes) : e.g. "quick turnover, short maturity and large - AASB 7";, but many items are required to be reported as gross i.e. cash out and cash in for the same type of item are required to be reported separately e.g. property sale and purchase, interest paid and interest earned , borrowings and repayment of borrowings.
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Company Name Statement of Cash Flows For The Year Ended December 31, xxxx |
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cash receipts from customers....................................................xx cash payments to suppliers......................................................(xx) cash payment of taxes..............................................................(xx) cash payment of interest on property,plant&equipment.........(xx) Cash provided by Operating activities...........................xx cash invested in/(divesting from) other investments..........................................(xx) cash used for plant and equipment...................................(xx) cash recovered from sale of plant and equipment.....................xx cash from dividend income from other investments..................xx cash from interest from other investments..........................................xx Cash Provided by investing activities.............................xx cash from issuing (buy back of) share capital...................................................xx cash from long-term borrowings..................................................xx cash used as repayment of long-term borrowings.....................(xx) cash paid as dividend to shareholders.......................................(xx) Cash Provided by financing activities............................xx |
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Net cash increase (decrease) in cash held......................xx |
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