Cash flow statement

Question 1

Operating activities

Answer 1

Profit after tax adjusted for:

• Depreciation
• Inventories
• Receivables
• Payables
• Accruals
• Interest received
• Payment of dividends
• Leave in interest paid and tax paid

Question 2

Investing activities

Answer 2

Change in intangible assets & PPE (sale & purchase)
Change in investments (sale and purchase)
Interest and dividends received

Question 3

Financing activities

Answer 3

Issue of new shares
Borrowing / repaying money
Payment of dividends
Issue / payment of treasury shares

Question 4

Direct vs indirect method

Answer 4

Direct: Take all cashflows from the cash account and allocate out accordingly

Indirect: Start with net income and adjust it for the items above