What is Supplemental cash flow disclosures?
In short
Companies disclose interest paid (net of amounts capitalized) and income taxes paid, as well as significant noncash investing and financing activities, alongside the statement of cash flows.
Key takeaways
- Under the direct method, a reconciliation of net income to operating cash flow is also required.
- Noncash activities include buying assets by issuing debt or converting debt to equity.
- They can be presented at the bottom of the statement or in the notes.
Where it's tested
FAR: Statement of Cash Flows — study notes, a five-minute revision sheet and practice questions.
Practise: 3 questions
Question 1 of 3 · 0 answered
Under US GAAP, interest paid on borrowings is classified as: