Accounting




September 17, 2008

Is the direct method still used in the statement of cash flows?

The direct method of preparing the statement of cash flows is recommended by the Financial Accounting Standards Board (FASB). However, the direct method is rarely used.

The 2007 edition of Accounting Trends & Techniques published by the American Institute of Certified Public Accountants surveyed 600 annual reports to stockholders for the year 2006 and found that only 6 used the direct method, while 594 used the indirect method.

You can read the official FASB pronouncement on the Statement of Cash Flows at www.FASB.org/st.

Learn about Statement of Cash Flows prepared under the indirect method.

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Comments

5 Responses to “Is the direct method still used in the statement of cash flows?”

  1. greg on September 17th, 2008 11:44 am

    Hey,
    I need an Accountant for a Small Bus. I have tried many, and only the first one I had was any good. ((I think you know the guy)!! Seriously, it is a problem finding someone, that is knowledgable, and affordable. Can you advise on how to find the right fit? greg

  2. morgan on September 24th, 2008 3:43 pm

    It’s hard to me to do a cash flow Statement

  3. morgan on September 24th, 2008 3:43 pm

    It’s hard to me to do a cash flow Statement
    whatever the method

  4. Yary on October 21st, 2008 6:01 pm

    yes, It is.

  5. chelsi on November 16th, 2008 8:10 am

    hi there my name is chelsi and i would love to join your group

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