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Treatment of loan to employee in cash flow

sunita rana (no) (100 Points)

23 May 2015

can anyone tell me the treatment of loan to employee in cash flow statement whether its operating,financing,investing?

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Kamlesh Ladhwani (CA) (35 Points)
Replied 23 May 2015

Originally posted by : sunita rana
	can anyone tell me the treatment of loan to employee in cash flow statement whether its operating,financing,investing?

Operating if your company's business is of giving loan.

Investing if your company's business is not of giving loan.

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CA. Dashrath Maheshwari (TaXpert) (15103 Points)
Replied 24 May 2015

I think you are talking about salary advances to employees. If so, you need to consider these under change in working capital while calculating cash from operations.