Question
Which of the following is a NON-CASH investing or financing activity, disclosed separately rather than within the body of the statement of cash flows?
Scoring
- 40% Account naming / line matching
- 40% Amount correctness
- 20% Structure / section placement
IAS 7.43 — non-cash investing and financing transactions
Transactions that change assets and liabilities without moving cash are excluded from the statement of cash flows itself and disclosed separately. The test is simply whether cash moved — if it did not, the item cannot appear in any of the three activity sections.
Common mistakes
- Showing an asset acquired directly under a loan or lease as both an investing outflow and a financing inflow.
- Including a share-for-share exchange or a conversion of debt to equity in financing activities.
- Omitting the required separate disclosure altogether once the item has been excluded.
Further readingIAS 7: the three activity sections