IAS 7 Statement of Cash Flows requires that investing and financing transactions that do NOT require the use of cash or cash equivalents should be:
A) excluded from a Statement of Cash Flows;
B) included in a Statement of Cash Flows before operating, investing and financing activities;
C) presented in the Statement of Cash Flows after operating activities and before investing and financing activities;
D) presented in a Statement of Cash Flows after the operating, investing and financing activities have been presented.

Question

Quizplus · Accepted Answer

DIAS 7 requires that investing and financing transactions that do not require the use of cash or cash equivalents be excluded from the cash flow statement itself but disclosed elsewhere in the financial statements. This is to ensure that the cash flow statement accurately reflects cash movements. However, such transactions are still relevant for understanding a company's financing and investing activities, hence the allowance for their disclosure elsewhere in the financial statements.

IAS 7 Statement of Cash Flows Requires That Investing and Financing