 We are starting the statement of cash flow and this first of all we have objectives and scope and the objective, the basic objective is to ensure that the companies reports their cash generation and cash absorption in a way which help provide information to assist users who make economic decisions based on the accounts. Basically what we are supposed to do here is to tell us where the money is coming from so that the shareholders can know the amount of money the users have received and where the money is coming from. So basically that is the most important thing about this statement. The quality of income is provided by the cash flow statement. Income statement give you profits or loss but that is based on certain assumptions. But in this case absolutely cash coming in and cash going out so there is no as such assumption in this particular case. Stakeholders want to see whether the entity is generating enough cash to meet the operation needs of the entity. You are buying, selling goods and services so first of all see whether you are generating enough cash to pay off your goods and services. Similarly the sale is supported by the let us say staff, admin staff or marketing staff so it is enough money generated by those people. Then similarly the tax is being paid, interest is being paid so we want to see the stakeholder want to see whether the end of money is being created by the operation not by selling some assets no by the operation by general business you are doing. CFA indicates whether the entity is increasing its capacity adding more non-current assets or selling them. By looking these statements one can see whether assets are being added I am talking about non-current assets which is capacity building so whether the company is building their capacity going for further or they are selling of it because if they are selling then it is inflow but when they are buying it it is outflow. So similarly we have number of plant equipment machinery we will see how they are moving whether they are increasing or whether they are going out so then we have some investments long term investments we must see whether the long term investments are increasing that you are putting investments into long term business or you are selling those investments so you must see that what is the movement of these investing activities so that is also then cash flow provide information whether the more capital or loans are added or paid off usually when we borrow money money is coming in so it is inflow. But when we repayment it is an outflow so we have to see whether the company is raising more money by the loans or they are simply paying back or maybe they are issuing shares or maybe they are paying dividends this is how they have to see in this objective. Now usefulness of cash flow statement the entity's ability to generate future cash flows any business or if they do not generate cash flow for future then they cannot survive through entity's ability to pay dividends and meet obligations if the company does not pay dividend to the shareholders then business cannot go much further because shareholder will start selling your share and your share value will go down in the market. The reason for the difference between net income and net cash flow from operation that is an other important thing actually what we do in practice we need to reconcile the two that if the profit increasing why not it is being supported by the cash increase that is the important thing though we need to see then the cash and non-cash investing and financing transactions during the period. Now in this case it happens sometime that you are adding an asset long term assets I am talking about but you are not paying cash immediately you might be borrowing money and that money is going to be used or sometime we are adding an assets but we are simply giving them some shares against it so do remember here though the assets are increasing and similarly share capital is increasing but there is no money coming in so here we are absolutely looking for the money coming in and money going out. Now the question is if such a thing happens so where do we report this that your assets are increasing and the share capital is increasing but there is no money coming so in this case we have to give a note to the cash flow statement that there is a transaction it's a significant transaction where we are buying the assets and we are issuing the shares. Now there is cash and cash equivalents the most important item in this statement is cash and cash equivalents in fact everybody knows what is cash but here we are talking about cash in hand cash in petty cash anywhere the cash involved cash at head office or cash in the factory of total cash in hand similarly we got number of banks account so we have all those bank accounts they are also cash now if they can be a positive they can be some negative you mean there can be some overdraft as well so we need to show how the cash and cash equivalents is reconciled because at the beginning of the year you have a certain amount of money now towards the end of the year how much money is there and what is the difference that difference actually is being taken care by the statement of cash flow. Now cash equivalents are short term liquid investments short term liquid investment basically at any amount any investment which which can be materialized which can be sold out which can be recovered in terms of money within next three months and without any loss that if you are certain if the money will be coming within three months time so we say business short term investments which are subject to an unsignificant change in value when there is no change in value then we have cash in fact the cash we call it is a king because if profit is life to a company then cash is oxygen unless a business generate enough cash it cannot survive thank you very much.