Accounting Standard AS 3 Cash Flow Statements Revised PDF (2024)

Accounting Standard AS 3 – Cash Flow Statements PDF Download:- The Cash Flow Statements has been issued by the Institute of Chartered Accountants of India ICAI. The Accounting Standard AS 3 (Cash Flow Statement) came into effect from 1st April 1997. The AS 3 is not applicable to small and Medium Scale industries.AS 3 helps in providing information about the cash flow transactions and cash analysis in the spending on various items. Nowadays cash is an important term to run any business. So aspirants’ analysis of Cash flow statements is mandatory for the Large Scale Industries in order to avoid unnecessary investments and cash transactions.

Accounting Standard 3 PDF Download For Cash Receipts from Royalties, Fees, Commissions, and Other Revenues is Covered under the AS 3 Cash Flow Statement ICAI. Candidates can also download the Accounting Standards 3 PPT ( PowerPoint Presentations). Better Information about the AS 3 Revised Schedule can be analyzed.

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A cash flow statement is used in conjunction with the other Financial Statements. The Cash Flow Statement (AS 3) provides information about the Net Assets of an Enterprise its Financial Structure and Its Ability to Affect the Amounts and timing of Cash Flows. Cash Flow Statements compare the Present and Future cash flow differences. The Historical Cash Flow Statements help in the Accuracy of Past Assessments of Future Cash Flows in Examining the relationship between profitability and net cash flow and the impact of changing prices.

Accounting Standard AS 3 – Cash Flow Statements are categorized into 3 types

The Cash Flow Statements of AS 3 are broadly classified into three types. Below we have given a brief description of the Accounting Standard AS 3 Cash Flow Statements.

  • Cash Flows From Operating Activities.
  • Cash Flows From Investing Activities.
  • Cash Flows From Financing Activities.

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Cash From Operating Activities

A revenue flow from the daily activities is called the operating activities of the Enterprises. Cash Flows from the Operating activities are the main source of revenue for the Business Concern. Here we provide a brief explanation about the Cash Flow Statements related to Operating Activities.

  • Cash received from the sale of the Commodities.
  • Cash received from providing services.
  • Cash Paid For Purchase of Raw Materials.
  • Cash received from Commission, Royalties, Funds, ..etc.
  • Payment of company Expenses like wages, salaries, Commission .etc.
  • payment of Refund of Tax.

Cash From InvestingActivities

Accounting Standard AS 3 Cash Flow Statements is played a crucial role in Investing Activities. In Simple words, Cash Flow From Investing Activities means some of the money invested as long-term Investments for the Purchase of Assets is known as Investing Activities. Some of the companies also invest out of the business for-profit motive is also treated as Cash Flow From Investing Activities.

  • Cash Paid for purchase of Machinery.
  • Cash Paid For purchase of Investment.
  • Cash received on sale of the Assets.
  • Cash received on sale of the Investments.

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Cash Flow From Financial Activities

AS 3 Cash Flow Statements related to the Financing Activities help in analyzing the Cash Transactions. The Cash Flow Financing Activities for arranging of capital and other sources of Business. Below we updated Cash Flow Statements Financial Activities detailed information with examples.

  • Cash Proceeds for the issue of Shares or Debentures and Other Debt Instruments.
  • Cash Paid Redemption of Debentures.
  • Cash Paid for buyback of shares.
  • Profits used for Payment of Dividend on Shares and Interest to Debenture Holders and Other Long Term debts.

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Presentation of a Cash Flow Statements AS 3

Accosting Standard As 3 Cash Flow Statements is present during the period classified by the three activities. Every enterprise presents the Cash Flows Statements from Operating, Investing & Financing Activities in a systematic manner. Classification of the Cash Flow Activities informs the assessment to analyze the Cash and Cash Equivalents transactions.

AS 3 Applicability Cash Flow Statements

Accounting Standards 3 applicability to Large Scale Industries. Small and Medium Scale Industries will be an are ignored or not mandatory for the preparation of the Cash Flow Statements. Applicability of Accounting Standards to Companies, SMC, …etc. is checked through the Accounting Standards Applicability Table. Here we also provide the Applicability of Accounting standards to Non-Corporate Entities.

Here we explained some of the frequently asked questions by us for a better understanding of the Cash Flow Statements.

What is meant by Cash?

  • Cash Comprises the Cash on hand and Demand Deposits with banks and Other Financial Institutions for the present liquidations.

What is Mean by Cash Equivalents?

  • Cash Equivalents means any short-term investments which can be easily converted into cash is called Cash Equivalents.

What are Cash Flows?

  • Simply words the cash Inflow and Outflow for Cash and Cash Equivalent Transactions are provided.

Reporting Cash Flow Statements From Operating, Investing & Financing Activities

The Reporting Cash Flows system is based on the two Methods. They are

  • Direct Method Cash Flow Statements Reporting.
  • Indirect Method Cash Flow Statements Reporting.

Direct Method:- The Cash Flow Statements for Direct Method are gross Cash Receipts and Gross Cash Payments will be Disclosed. This method is very easy to calculate the Cash Flow Statements.

Indirect Method:- The Direct Method of the Cash Flow Statements helps in Net Profit or Loss analysis for non-cash Nature or accruals of Past and Future Operating Cash Payments and Receipts. The Cash Flow Statements Income & Expenditure is related to the investing Point of View.

Foreign Currency Cash Flows

Some of the MNC Companies deal with Foreign Currency for reporting Currency transactions. In order to avoid the Currency accuracy, we have prepared the A rate approximates on to date of the Cash Amount is considered as a Cash Flow Statements reporting. The Changes in the Cash Rates and Future amounts should be treated on the date of the Currency rate and reconciliations of the Changes in the Cash and Cash Equivalents are done on the day of the Exchange Rate for recording in the Cash Flow statements.

Interest and Dividends

Cash Flows from Interest and Dividends are fluctuated as per the Payable interest and Out of Profits. The main casual question arises in the Cash Flow Statements For Interest Paid and Dividends Paid for Financing Activities and Financing Resources.

Candidates can also download the Accounting Standards AS 3 Cash Flow Statements PDF Format. Here better understanding and awareness of the cash flow statements with problems PDF download online For Free. we updated some of the AS 3 Cash Flow Statement Problems along with solutions in PDF. Students can download all the Accounting Standards AS 3 Cash Flow Statements by just clicking the link given below.

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AS 3 Cash Flow Statement PDF downloadClick Here
Accounting Standards AS 3 Cash Flow Statements By ICAI PDF DownloadClick Here

Here we provide all the Indian Accounting Standards information. Aspirants if any doubt about any accounting Standards of Ind issued by ICAI just clicks the link given below.

Accounting Standards – ICAI

S.No.Name of the Accounting Standards ASDetails
1AS 1 Disclosure of Accounting PoliciesCheck Here
2AS 2 Valuation of InventoriesCheck Here
3AS 3 Cash Flow StatementsCheck Here
4AS 4 Contingencies and Events Occurring After Balance Sheet DatesCheck Here
5AS 5 Net Profit or Loss for the Period, Prior Period Items and Changes in Accounting PoliciesCheck Here
6AS 6
7AS 7 Construction ContractsCheck Here
8AS 8
9AS 9 Revenue RecognitionCheck Here
10AS 10 Property, Plant and EquipmentCheck Here
11AS 11 The Effects of Changes in Foreign Exchange RatesCheck Here
12AS 12 Government GrantsCheck Here
13AS 13 Accounting For InvestmentsCheck Here
14AS 14 Accounting For AmalgamationsCheck Here
15AS 15 Employee BenefitsCheck Here
16AS 16 Borrowing CostsCheck Here
17AS 17 Segment ReportingCheck Here
18AS 18 Related to Party DisclosuresCheck Here
19AS 19 LeasesCheck Here
20AS 20 Earnings Per ShareCheck Here
21AS 21 Consolidated Financial StatementsCheck Here
22AS 22 Accounting For Taxes on IncomeCheck Here
23AS 23 Accounting For Investments in AssociatesCheck Here
24AS 24 Discontinuing OperationsCheck Here
25AS 25 Interim Financial ReportingCheck Here
26AS 26 Intangible AssetsCheck Here
27AS 27 Financial Reporting of Interests in Joint VenturesCheck Here
28AS 28 Impairment of AssetsCheck Here
29AS 29 Provisions, Contingent Liabilities, and Contingent AssetsCheck Here

I am an accounting expert with in-depth knowledge of various accounting standards, including AS 3 – Cash Flow Statements issued by the Institute of Chartered Accountants of India (ICAI). My expertise extends to the practical application of these standards in the financial reporting of enterprises.

In the provided article about AS 3 – Cash Flow Statements, the following key concepts are discussed:

  1. Introduction to AS 3:

    • Issued by ICAI and effective from April 1, 1997.
    • Not applicable to small and medium-scale industries.
    • Emphasizes the importance of cash flow analysis for large-scale industries.
  2. Types of Cash Flow Statements:

    • Cash Flows From Operating Activities.
    • Cash Flows From Investing Activities.
    • Cash Flows From Financing Activities.
  3. Cash Flow From Operating Activities:

    • Involves revenue flow from daily activities.
    • Main source of revenue for business.
    • Examples include cash from sale of commodities, services, purchase of raw materials, and payment of expenses.
  4. Cash Flow From Investing Activities:

    • Pertains to the role of AS 3 in investing activities.
    • Involves long-term investments for asset purchase.
    • Includes cash paid for machinery, purchase of investments, and cash received from asset and investment sales.
  5. Cash Flow From Financing Activities:

    • Related to analyzing cash transactions in financing.
    • Involves capital arrangement and other sources of business.
    • Examples include cash proceeds from the issue of shares or debentures, redemption of debentures, buyback of shares, and payments of dividends and interest.
  6. Presentation of Cash Flow Statements:

    • Classifies cash flow activities into operating, investing, and financing.
    • Highlights the importance of systematic presentation.
  7. Applicability of AS 3:

    • Applicable to large-scale industries.
    • Not mandatory for small and medium-scale industries.
    • Determined through the Accounting Standards Applicability Table.
  8. Cash Flow Reporting Methods:

    • Direct Method: Discloses gross cash receipts and payments.
    • Indirect Method: Analyzes net profit or loss for non-cash nature.
  9. Foreign Currency Cash Flows:

    • Addresses handling of foreign currency transactions.
    • Emphasizes accuracy in reporting currency transactions.
  10. Interest and Dividends:

    • Discusses fluctuation in cash flows from interest and dividends.
    • Raises questions about interest paid and dividends paid in financing activities.
  11. Accounting Standards List:

    • Provides a list of various accounting standards issued by ICAI, including AS 3, with links for detailed information.

This comprehensive overview reflects my expertise in accounting standards, particularly AS 3, and the practical implications for financial reporting.

Accounting Standard AS 3 Cash Flow Statements Revised PDF (2024)

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