THE STATEMENT OF CASH FLOWS, PART OF DECISIONAL MANAGEMENT
THE STATEMENT OF CASH FLOWS, PART OF DECISIONAL MANAGEMENT

Summary/Abstract: By cash flows, an entity funds its activity, ensures its continuity and develops its future decisions. The main objective of the cash flow statement is to provide relevant information on receipts and payments during a financial year, in order to determine the solvency of an agricultural entity. The role of the cash flow statement is to report the flows related to a certain period, structured by distinct activities: operating, investing and financing activities and the net increase of cash or cash equivalents obtained by comparing the existing situation at the beginning and end of the financial year. The operating activities of an agricultural entity are its main revenue-producing activities, investing activities refer to the acquisition and disposal of long-term assets and financing activities include the operations that alter the size and structure of an entity’s equities and debts.

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