 Today we are going to start statement of cash flow and first of all let's see the learning outcome of this statement. Students will be able to prepare cash flow statement as per the prescribed format specified by IS-7. Now interestingly they have not prescribed any format for income statement and balance sheet but for cash flow statement the format is given that the format is that there are three activities we have to note into it. Number one is the operating activities, the other one is the investing activities and the other one is the financing activity. All these three activities are in certain order. Then understand the difference methods of preparing the cash flow statements. There are two different methods. Number one is called direct method and the other one is called indirect method. In direct method we start with cash from operating activity, collection from customers, payment to the suppliers, payment for the expenses and so on. Payment for taxes, payment for interest and so on. So this is directly related with the payments for these five items. Now so far other indirect method is concerned these operating statements are not like this that you should start straight away from payment to the supplier etc. but we start with the profit figure and in that profit figure we make adjustments where the cash flow is not involved. All those items where there is no money involved we should add it back and then come up with the final figure of cash flow from the operating statement and interestingly the result is the same. Whatever is in flow ultimately both method direct as well as indirect give the same answer. Then the second is the investing activities. Investing activity is basically when we go for long term assets, when we buy we report it as outflow and when we sell we report it as inflow. Now then sometime we also have long term investments. So those long term investments will also be when we put our money in long term investments it is outflow and when we sell those investments that is inflow. Third activity is basically financing activity. Here we see how much money put in by the shareholders or by the lenders and how much we paid back to the shareholders and to the lenders. Now dividend paid to the shareholders we will report it here. Similarly if any money brought in by the shareholders that also we put in here. Now there is an interesting thing here that if you are issuing shares and you are not getting cash that will not be reported here. Although the share of capital is increasing but there is no cash flow involved. So in that case we have to give a note that if the shares have been issued then the money is not coming in. For example you are issuing bonus shares. Bonus shares is simply capitalizing the retained earnings. So there is no money coming in but at the same time the capital investing activity I mean financing activity you will see the share capital is increasing but there is no money coming in. Thank you very much.