What is difference between cash flow statement and fund flow statement?

Banking & FinanceManagementCompanies/Organisations

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

Cash flow statement

  • Inflows and outflows of cash and cash equivalents.

  • Main purpose is to show the movement of cash.

  • Cash basis of accounting.

  • Short term analysis.

  • Inflows and outflows of cash.

  • Contains both opening and closing balances of cash and its equivalents.

  • Part of financial statement.

  • Calculates net cash position.

  • Mandatory to report as per GAAP guidelines.

  • External use.

  • Cash flow from operating, financing and investing.

Fund flow statement

  • Shows change in financial position of the entity.

  • Main purpose is to show the reason in change in financial position between two accounting periods.

  • Accrual basis of accounting.

  • Long term analysis.

  • Sources and applications of funds.

  • Does not contain opening and closing balance of cash and its equivalents.

  • Part of financial statement.

  • Calculates working capital.

  • Internal use.

  • Not mandatory to report.

  • Applications of funds and sources of fund.

raja
Published on 24-Jul-2020 10:31:49
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