The statement of cash flows according to International Financial Reporting Standards

The statement of cash flows has as its main objective to provide information about cash receipts and payments, operating, investing and financing activities of the entity by informing users about the origin of the funds that the company has used during a given period.

As well as the use that has been given to them during this time so that with this the company has sufficient tools to make diagnoses related to the ability of the entity to obtain external financing and determine whether the company is growing with resources generated by itself or by reason of these amounts obtained from third parties. In addition, it will know its capacity to generate positive cash flows.

Among the general characteristics of the financial statements we can find, the fair presentation and compliance with International Financial Reporting Standards, Materiality (relative importance) and grouping of data, Compensation, Frequency of Information, Comparative Information and Uniformity of Presentation.

Financial statements should present fairly the financial position and financial performance, as well as the cash flows of an entity. This fair presentation requires the fair presentation of the effects of transactions, as well as other events and conditions, in accordance with the definitions and recognition criteria for assets, liabilities, income and expenses established in the Conceptual Framework.

It is presumed that the application of International Financial Reporting Standards, accompanied by additional disclosures where necessary, will result in financial statements that provide a fair presentation. An entity whose financial statements comply with the standards shall make an explicit and unreserved statement of such compliance in the notes.