engleski

Information capacity of cash flow statement - do we use it enough?

Lately the significance and importance of cash flow information has been more and more highlighted. The cash flow statement is based on monetary basis, while the statement of financial position and the profit and loss account are based on an accrual basis. Depending on the starting point, a different measurement basis leads to different business decisions. This paper analyzes the benefits and advantages of information presented in cash flow statement as well as the most important indicator based on the cash flow statement (free cash flow). In order to determine the application of these pieces of information and indicators, the proportion of Croatian companies that are obliged to prepare a cash flow statement is investigated. For the purpose of determination of the usefulness of information presented in cash flow statement in forecasting future cash flows, the method used in the preparation of the cash flow statement is analyzed.

cash flows, cash basis, free cash flow, cash flow statement, IFRS

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