IND AS 7 Statement of Cash Flows Objective: Ø Information about the cash flows of an entity is useful in providing users of financial statements with a basis to assess the ability of the entity to generate cash and cash equivalents: Ø Cash flow information is useful in assessing the ability of the entity to generate cash and cash equivalents and enables users to develop models to assess and compare the present value of the future cash flows of different entities: Cash & Cash Equivalents: Meaning Ø Cash equivalents are short-term, highly liquid investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value. Ø Cash equivalents are held for the purpose of meeting short-term cash commitments rather than for investment or other purposes. What includes in cash and cash equivalents? Investment: Ø For an investment to qualify as a cash equivalent it must be readily convertible to a know
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