cash flow

Where will you classify the following in cash flow statement?
1. Unsecured loans given to subsidiaries and interest on loans given to subsidiaries.

Why?
Replies (7)
Financing activities -Receiving /Paying loans related with Financial structure of the enterprise.

It should be treated just like an investment made in subsidiaries or by subsidiaries and classified under investing/financing activities. You can see many like cash flow statements here:

https://www.google.co.in/?q=%22loan+to+subsidiaries%22+investing+activities

To me, classifying it under investing activities seems more appropriate because as per AS 3 para 15 point (e) is classifying advances and loans paid to third parties under investing activities. I can hardly differentiate between an advance paid to a third party and to a subsidiary. Both are done with a business intent.

@ shilpi. It doesn't seem to be appropriate to classify the same under financing activities because the composition of the capital or borrowings are unchanged.

What do you think?

I just checked Infosys Ltd Financial statements year ended 31.3.2016.They classified these items under Financing activities.

What is the logic in that?
By the definition of financing activities it doesn't seem to be appropriate isn't it?

Yes.It doesn't seem appropriate.

By the way ,i have sent this query to ICAI bos.Will comment here as soon as i get reply.

Leave a Reply

Your are not logged in . Please login to post replies

Click here to Login / Register  

Company
30 October 2026
Asst Manager Accounts

Goodwin Pumps India Pvt Ltd

Chengalpattu

CA Inter

View Details
Company
28 October 2026
Assistant Director/ Associate Director-Finance & Accounting

Krea University

Chennai

CA

View Details
Company
ARTICLESHIP 07 November 2026
Article Assisstant

DPV & Associates

Chennai

CA Inter

View Details
Company
13 October 2026
Accountant

Zerdi & Co. Chartered Accountants

Pune

B.Com

View Details
Company
21 October 2026
CA INTER/ BCOM WITH EXPERIENCE

CA S KUMAR GUPTA & CO

Amritsar

CA Inter

View Details
Company
12 October 2026
Finance

I-Genext Consulting Private Limited

New Delhi

CA

View Details
Company
14 October 2026
Accountant

Rize.farm

Bengaluru

B.Com

View Details
Company
Featured 07 November 2026
Paid Assisstant

DPV & Associates

Chennai

CA Inter

View Details