Statement of Cash Flow report

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Experienced Cover User NT45678
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Statement of Cash Flow report

Hello. Is it possible to produce a statement of cash flow that does not include General Journal?

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MYOB Moderator Steven_M
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Re: Statement of Cash Flow report

Hi @NT45678

 

A Statement of Cash Flow report will report all transactions associated with that accounts marked under the corresponding classification.

 

You are unable to exclude a particular transaction type i.e General Journals from being included in that report.

Kind regards,
Steven

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Experienced Cover User NT45678
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Re: Statement of Cash Flow report

Mmmmm well then the report title is an oxymoron. Can you see the problem here?

To include all journal entries in a 'Statement of CASH Flows' is a complete contradiction as most JEs are non-cash. Not really sure how this report is of use to anyone? MYOB need to review accounting standards and real-life Statements of Cash Flows (look online at any public listed company annual reports) and get with the program! Please!

 

 

MYOB Moderator Steven_M
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Re: Statement of Cash Flow report

Hi @NT45678

 

A Statement of Cash flow can be defined as the following:

A financial statement that shows how changes in balance sheet accounts and income affect cash and cash equivalents, and breaks the analysis down to operating, investing and financing activities.

Wikipedia  - Cash Flow statement 


My interpretation of that is that it doesn't indicate how the transaction was formed as long as it affected the Balance Sheet accounts then it should be reported on in that particular report. Thus AccountRight will report the changes in cash and cash equivalents during the selected period.

 

For example, if you invest in a large asset i.e. land you would generally record a journal entry for that due to the complex nature of that transaction. As an investment in an asset should appear in the Investing activities not including that journal entry can understate that Investing activities on that Statement of Cash flow and thus show an incorrect value.

Kind regards,
Steven

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Experienced Cover User NT45678
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Re: Statement of Cash Flow report

Hi Steven

sorry but a wikipedia definition is most definitely not a good source of information in this situation therefore your interpretation is incorrect. Please check this with an accountant.

For a correct source of information please refer to Accounting Standard AASB 107 " Statement of Cash Flows" as per the CAANZ (Chartered Accountants Australia & New Zealand). This states that "The Statement of Cash Flows shall report Cash Flows during the period classified by operating, investing and financing activities". The standard defines "Cash Flows" as inflows and outflows of cash and cash equivalents. The whole purpose of this report is to show ONLY cash movements, hence it's title. I think MYOB need to look at this in more detail! Could you please pass this on up?

 

Ultimate Partner DuncanS
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Re: Statement of Cash Flow report

@NT45678 @Steven_M

 

NT,

 

My understanding is that members of the major industry bodies do not to produce a Statement of Cash Flows for a Special Purpose Financial Report. A Special Purpose Financial Report is prepared for businesses with a turnover of say $30 million or less.

 

Steven and I have discussed this before.

 

MYOB has produced a Statement of Cash Flows for many years (about ten).

 

The difficulty being that most Tax Accountants use specialised software to prepare Financial Statements and Tax Returns.

 

The issue appears not to lie within the commercial version of MYOB.

 

I was a Industry Practitioner for some twelve years with Finsia/Kaplan and taught students the subject Analysing Financial Statements. The Statement of Cash Flows was certainly included.

 

Maybe the Government should insist that a Statement of Cash Flows be included in a Special Purpose Financial Report. The major Accountancy bodies might argue that a Statement of Cash Flows is not required to prepare a Company Tax Return.

 

I ask the question whether the role of a Tax Accountant is tax compliance based or the role of a Adviser where regular reporting would be provided to a business owner.

 

Duncan

Duncan Smith
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Re: Statement of Cash Flow report

Good afternoon,

 

MYOB produces the cash flow statement by way of the 'Indirect' method which starts with profit and reconciles to cash flows from operating activities.

 

AASB 107 allows companies to use either the direct or indirect method.

 

If the direct method is used, AASB 107 requires disclosure in a note showing the reconciliation of cash.

 

Can MYOB provide the option to use the 'Direct method'  - Lists cash receipts from specific operating activities ;  Lists cash payments for each major operating activity?

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