What is difference between cash flow statement and balance sheet?

Banking & FinanceManagementCompanies/Organisations

The major differences between cash flow statement and balance sheet are as follows −

Cash flow statements

  • It is also called a statement of cash flows.

  • It is calculated for short periods (quarterly).

  • International accounting standards 7 (IAS 7).

  • Money coming into the business is termed as cash inflow.

  • Money going out from the business is termed as cash outflow.

  • Money from operations, investments, and other financial activities.

  • It is used by Short term investors.

  • It is classified into three parts.

  • Budgeting and forecasting.

  • It is prepared using a Profit and loss account and balance sheet.

Balance sheet

  • It is a statement of financial position.

  • It is calculated yearly.

  • Generally Accepted Accounting Principle (GAAP), Federal Accounting Standards Advisory Board (FASAB).

  • Money coming into the business is termed as assets and ownership.

  • Money going out from the business is termed as liabilities.

  • Money from assets and liabilities.

  • It is classified into two parts.

  • It refers to the financial position of the firm.

  • It is prepared from the Profit and loss account.

raja
Published on 24-Jul-2020 10:17:18
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