28 October 2010
Hi Freinds, I am about to complete an audit and now going through the cash flow statement. the company has taken over two companies under scheme of amalgamation and the PC was paid by issuing some shares as well as cash.I just wanted to know that what adjustments are required to be done in cash flow Statement as shares has been issued without effecting cash.
11 November 2010
Hi Pinkesh, for cash flow one item should be a current item and the other non current. In ur case, there is no flow of cash to the extent PC is paid by issuing shares and the portion for which cash has been paid will be shown as outflow under investing activities Regards, CA Shakuntala Chhangani
02 March 2011
Hi again Pinkesh, as i hv already mentioned that to result flow, one item need to be a current item and other non-current. when u take over cash from old entity and in exchange give back cash, only the differencial amount will result into flow and will be shown in CFS.however, don't forget to give effect of the same in adjustment for changes in working capital while calculating cash from operating activities. Regards, CA Shakuntala Chhangani
CAclubindia
