Dear Prof. Stiner
1. Why is the Statement of Cash Flows important to U.S. users of accounting information?
Because Cash flow statements are very important to American investors and lenders.
Each is tant for the U.S. user explaining information.
For example, Stockholders want the main business of the company to increase cash.
When a loan is made, the borrowing company (borrower) receives cash.
Cash is the most important asset a company has. Cash is essential for the survival of the company.
2. Look at the table that compares the direct and indirect methods.
What is the main difference between the indirect and direct methods:
a. in operating activities?
b. in investing activities?
c. in financing activities?
The main difference between the indirect and direct methods is that the indirect is simple the direct methods.
The in operating activities is including the in direct . The in investing activities and in financing activities is including the direct methods.
3.How do Japanese companies report their changes in cash during the year?
This source may help in answering this question:
http://www2g.biglobe.ne.jp/~ykawamur/n980107.htm
It is an unofficial source of Japanese accounting information.
The BADC issued "Opinion on Reviewing Reporting System of Consolidated
Financial Statements" in June 1997. It continued its deliberation, in the project of consolidation,
about consolidated cash flow statements since August 1997.
It would be the first time for Japan to have cash flow statements as one of the financial statements.
Parent-only funds flow statements have been required in annual securities reports but outside of the section of financial statements.
sincerely Ｙour's
lin