Accounting Standard: 3

1
Accounting Standard 3

• Cash Flow Statement

2
Accounting standard-3 is mandatory for listed
companies and entity with a turnover exceeding
Rs.50 crore.
3
Accounting standard-3 deals with cash flow during
the period from operating, investing and
financing activities.
4
Operating Activities Operating activity are the
principal revenue-producing activity that are not
investing or financing activities. Enterprises
should represent cash flow from operating
activities using either direct method or indirect
method.
5
Investing Activities Investing Activities refer
to acquisition and disposal of long term assets
and other investment which are not included in
cash equivalent.
6
Financing Activities Financing activities are
those activities that result in changes in the
size and composition of owners capital and
borrowing of the enterprises. Ex changes in
share capital and loan fund.
7
Extraordinary items should be classified as
arising from operating, investing or financing
activities.
8
Disclosure

• Cash and cash equivalent,
• Reconciliation of amount in its cash flow with
  equivalent items,
• Significant cash and cash equivalent which are
  not available for use along with a comment by the
  management.