Publication Date


Document Type


First Advisor

Norton, Curt

Degree Name

B.S. (Bachelor of Science)

Legacy Department

Department of Accountancy


Financial Accounting Standards no. 95, the Statement of Cash Flows, was released to enhance the comparability and usefulness of the Statement of Cash Flows. Overall, the new guidelines (under Financial Accounting Standards no. 95) on preparing the Statement of Cash Flows have solved many problems that have been disputed int he past, however comparability and usefulness still remain to be a significant concern among financial statement users. Specifically, classification of several items, the direct and indirect methods of reporting cash flow from operations, and noncash transaction disclosures are three of the most significant unresolved issues that must be addressed. Proposed recommendations of improvement include: 1) A new statement called a Statement of Income and Cash Flows, 2) a standardized noncash disclosure note, and 3) mandated use of the direct method of reporting cash flows from operations.


31 pages




Northern Illinois University

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