Fund Flow Statement

Others 3729 views 6 replies

VIKAS BANSAL

Student

45 Points Joined March 2009

Hello Friends,

My question is very easily that why we are not consider provision for Tax & Proposed Divided as a part of current Liab. Directly in Fund Flow Statement if question is silent ? In Cash flow statement AS -3 is apply so In CFS we are not consider provision for TAx & Proposed Dvidend as a part of current Liab. but In Fund Flow Statement, no any AS apply.

My View is "Provision for Tax & Proposed Dividend always be consider as a part of current Liab. if question says whatever else.

Give Your View...........

Replies (6)

Sasanka Bhalaki

Student

1935 Points Joined May 2011

See Vikas..in funds flow statement..u have two choices according to Provision for tax..that is if u wanted to treat it as current liability..ucan treat it..and other choice is debit the current year provision of taxto P&l app a/c and tax paid to should be posted in application of funds..

in the same way proposed didvidend also can be treated as current liability..if u don't want to do so.the other option is same as above..dividend paid is posted in application of funds and proposed dividend is debited in p&l app a/c ..

M. N. JHA

8316 Points Joined June 2009

Because both are adjusted seprately in FUND FROM OPERATION.

Guest

Originally posted by : Sasanka Bhalaki
	See Vikas..in funds flow statement..u have two choices according to Provision for tax..that is if u wanted to treat it as current liability..ucan treat it..and other choice is debit the current year provision of taxto P&l app a/c and tax paid to should be posted in application of funds.. in the same way proposed didvidend also can be treated as current liability..if u don't want to do so.the other option is same as above..dividend paid is posted in application of funds and proposed dividend is debited in p&l app a/c ..

agreed

U S Sharma

glidor@gmail.com

21063 Points Joined January 2010

as funds flow is based on realtime basis, no future provisions take place in the year, unless the record date or date of accural is placed in the period of fund flow statement,

SUMIT

article

55 Points Joined March 2011

As per the definition of current liabilty, liability related to only one year or less is treated as current liabilty. As far as provision for tax and proposed dividend is not only related to one year because in provision also advance tax is to be adjusted and also in proposed dividend if some unpaid dividend (until transfer to education and protection fund) is there it should also included in proposed dividend.