 Hello in this lecture we will define indirect method according to fundamental accounting principles while the 22nd edition the definition of indirect method is presentation that reports net income and then adjusts it by adding and subtracting items to yield net cash from operating activities on the statement of cash flows. So obviously when we are looking at the indirect method we are considering the statement of cash flows and the statement of cash flows can be done in two different general ways those ways being the indirect method and the direct method. The indirect method is actually a bit more common for a few different reasons. One is that we have already calculated net income therefore makes sense for us to start with net income and kind of back into the cash flows from operated operations on it more of a cash basis. It also shows that difference which we like to see the difference between.