Reconciliation of Cash Flow with Profit & Loss A/c
This query is : Resolved
05 November 2007
Can anybody tell me:??
Can we reconcile Cash Flow with P&L or vise versa.
Because in Cash Flow we consider only actual inflow/outflow of the cash/bank, while in case of P&L, we show our expenses on accrual basis. So how can we reconcile cash flow with P&L??
Can we reconcile Cash Flow with P&L or vise versa.
Because in Cash Flow we consider only actual inflow/outflow of the cash/bank, while in case of P&L, we show our expenses on accrual basis. So how can we reconcile cash flow with P&L??
05 November 2007
What is the purpose? You can find cash profit by doing so and coross check it. This process is done only for the academic interest.
05 November 2007
Dear Kapil:
My senior has asked me o reconcile Cash Flow with P&l, because in Cash low it it showing surplus while in P&L, it is showing -ve profit.
My senior has asked me o reconcile Cash Flow with P&l, because in Cash low it it showing surplus while in P&L, it is showing -ve profit.
05 November 2007
Dear Shilpa,
I am posting the details for your perusal.
I am posting the details for your perusal.
05 November 2007
Dear Shilpa,
You must have computed profit made during the year i.e. increase in P&L account balance and
Add back
Provision for taxation
Proposed Dividend
Transfer to Reserves
You will arrive at Net Profit before taxation taken to cash flow
This will apply cash flow in operating activities in Indirect Method.
The basic proble is that you are having Cash Flow Surplus and P&L negative.
It can be so that Operating Activities is negative and surplus is due to Financing and Investing Activities or interchange of any items.
I took too long to explain but as a Professor I take time.
I hope you will get the answer.
Happy Diwali.
You must have computed profit made during the year i.e. increase in P&L account balance and
Add back
Provision for taxation
Proposed Dividend
Transfer to Reserves
You will arrive at Net Profit before taxation taken to cash flow
This will apply cash flow in operating activities in Indirect Method.
The basic proble is that you are having Cash Flow Surplus and P&L negative.
It can be so that Operating Activities is negative and surplus is due to Financing and Investing Activities or interchange of any items.
I took too long to explain but as a Professor I take time.
I hope you will get the answer.
Happy Diwali.
05 November 2007
Dear Sir:
Thanks for your guidance.
I am trying for the same.
Thanks
Wishing you also a "Happy Dipawali"
Thanks for your guidance.
I am trying for the same.
Thanks
Wishing you also a "Happy Dipawali"
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