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Cash Flow Statements are available for Limited Companies, LLPs and Charities.
The key features of the Cash Flow Statement are:
Automatic calculation of the majority of cash flows from the trial balance
Flexibility to adjust cash flows calculated by IRIS
Disclosure of additional cash flows using client data screens
No use of non-trial balance (memorandum) accounts
Error trapping of common problems
It is assumed that the client has been set up on an Enhanced chart of accounts for Limited companies, LLPs and charities and that trial balances have been posted for the current, comparative and pre-comparative years.
For LLPs, there is an additional data screen to amend Transactions with Members, which are automatically calculated by IRIS. There will be no reference to movement in share capital or any dividends paid, as these will not be relevant for an LLP.
For Charities, there are additional data screens for income/expenditure relating to endowment funds.
The Cash Flow Statement requires trial balances to be posted for three years (where they exist).
Click the links below to jump to a particular section:
Step 1 - Debtor Balances
Step 2 - Creditor Balances
Step 3 - Loans
Step 4 - Hire Purchase & Finance Leases
Step 5 - Additional Disclosures
Step 6 - Produce the Cash Flow Statement
Step 7 - Check the Cash Flow Statement
Trade debtor balances are automatically calculated by IRIS.
Complete the Analysis
of Debtors data screen to allocate account balances within Other debtors and Prepayments
and accrued income to the relevant sections of the Cash Flow Statement.
This must be done for the current, comparative and pre-comparative years.
Example
- Account 594 is a debtor balance relating to the sale of an investment.
The account total should therefore be entered in the Other
debtors column as Sale of investments.
If the debtor balance relates to a section of the Cash Flow Statement that is not listed for example, Financing, then enter the balance as Other cash flow headings.
! An Error Message results if the screen totals do not reconcile to the trial balance in each year.
Trade creditor balances are automatically calculated by IRIS.
Complete the Analysis
of Creditors data screen to allocate account balances within Other creditors and Accruals
and deferred income to the relevant sections of the Cash Flow Statement.
This must be done for the current, comparative and pre-comparative years.
Example
- Account 786 is a creditor balance relating to an interest charge.
The account total should therefore be entered in the Accruals
and deferred income column as Interest
paid.
If the creditor balance relates to a section of the Cash Flow Statement that is not listed for example, Management of Liquid Resources, then enter the balance as Other cash flow headings.
An Error Message results if the screen totals do not reconcile to the trial balance in each year.
It is assumed that all loans (and debentures) have been posted to accounts 839-898 in the current, comparative and pre-comparative years.
The movement in these accounts must be explained by:
Entering the value of new loans in the Financing data screen (as a positive figure)
Entering the value of loan repayments
in the Financing data screen
(as a negative figure)
An Error Message results if a) and b) do not explain the movement in the trial balance accounts.
It is assumed that obligations under hire purchase contracts and finance leases have been posted to accounts 909-920 in the current, comparative and pre-comparative years.
The movement in these account balances during the year should be split into:
The value of fixed assets acquired under hire purchase contracts or finance leases, as entered in the Reconciliation to Net Debt data screen (as a negative figure)
The capital element of repayments on hire purchase contracts and finance leases, as calculated by IRIS
If
necessary use the Acquisitions and
Disposals data screen to disclose any cash flows which should
fall under this heading in the Cash Flow Statement.
If
necessary use the Management of Liquid
Resources data screen to disclose any cash flows which should
fall under this heading in the Cash Flow Statement.
If
necessary use the Additional items section of the Financing
data screen to disclose any cash flows relating to group balances
(accounts 715-724). (This is not applicable to unincorporated charities).
Enter any relevant non-cash changes in the Analysis of Changes in Net Debt data screen, for example reclassifications between short and long term debt.
The Cash Flow Statement will be produced as part of the LTD, LLP or CHA reports if the company has been categorised as type ‘ M’ in the Size of Company data screen.
For Unincorporated charities the Cash Flow Statement will be automatically produced if the charity is not specified as small in the Small Unincorporated Charities | Small and FRSSE Setup data screen, it can be omitted if not required .
The Cash Flow Statement can also be generated independently by selecting Reports | Annual and running the CFS report or CFC for charities.
For options to produce the Cash Flow Statement, Cash Flow Statement | Cash Flow Exemption
In either case a series of checks will be made on the Cash Flow Statement and potential problems will be highlighted in an exception report. The exception report will also suggest corrective action to solve these problems.
The majority of cash flows in the Cash Flow Statement are calculated by IRIS directly from the trial balance. These cash flows should be checked and if necessary adjusted using the client data screens.
Rounding differences - where there is a small rounding difference on the Cash Flow Statement, an adjustment should be made in either the Analysis of Debtors or Analysis of Creditors data screen (it is up to the individual as to which screen to use).
The adjustment should be made by either adding or subtracting the rounding amount to the Operating Activities figure and making an opposite adjustment to the Other cash flow headings. By making both entries, the total at the bottom of the screen should be the same.
To view Interactive Reports in the Product help:
Select Help | Help from the main screen select Example Reports | Interactive Accounts Layout
Select the Cash flow statement - CFS for Limited or Charitable company reports.