Difference Between Direct and Indirect Cash Flow

Key Difference – Direct vs Indirect Cash Flow

Direct and indirect cash flow are two methods of arriving at the净现金流量from operating activities in the cash flow statement.现金流量表consist of three main sections: net cash flow from operating activities, net cash flow from investing activities and net cash flow from financing activities. The key difference between direct and indirect cash flow method is that直接现金流量方法列出了来源的所有主要运营现金收入和会计年度付款whereasindirect cash flow method adjusts net income for the changes in balance sheet accounts to calculate the cash flow from operating activities.IASB（国际会计标准委员会）为组织提供了选择直接或间接方法来计算运营净现金流量的自由。

内容
1.Overview and Key Difference
2.什么是直接现金流
3.什么是间接现金流
4.Side by Side Comparison – Direct vs Indirect Cash Flow
5.概括

什么是直接现金流?

The direct cash flow method lists all the major operating cash receipts and payments for the accounting year by source. In other words, it lists how the cash inflows arose and how the cash outflows were paid. After all sources are listed, the difference between cash inflow and outflow becomes equal to net cash flow from operating activities.

E.g. ADP Company prepares the cash flow statement using the direct method

This categorization is very useful as it lists out all the sources of cash inflows and outflows. However, it will be difficult to adopt by significant scale companies as they have a number of sources of finance. Due to the time consumed in its preparation, the direct cash flow method is rarely used.

什么是间接现金流？

间接现金流量方法调整了变更的净收入balance sheetaccounts to calculate the cash flow from operating activities. Here, the changes in资产和责任accounts that affect the cash balances during the financial year are added or deducted from the净利before tax.

E.g. GHI Company prepares the cash flow statement using the indirect method

公司倾向于使用间接现金流量方法而不是直接方法，因为此方法使用损益表和资产负债表中的可用信息。因此，与直接方法相比，使用此方法准备现金流语句的时间要少得多。因此，间接方法被许多公司广泛使用。

What is the difference between Direct and Indirect Cash Flow?

Direct vs Indirect Cash Flow
直接现金流量方法列出了按来源来源的所有主要运营现金收入和付款。	Indirect cash flow method adjusts net income for the changes in balance sheet accounts to calculate the cash flow from operating activities.
Net Income Reconciliation
在直接法下,净利润不是reconciled to net cash flow from operating activities.	在间接方法下，净收入与经营活动的净现金流量相吻合。
Usage
直接现金流量方法的使用并未被公司广泛使用。	Indirect cash flow method is the popular and widely used in cash flow statement preparation.

概括– Direct Cash Flow vs Indirect Cash Flow

The difference between direct cash flow and indirect cash flow methods mainly depends on the way the net cash flow is arrived at. The resulting net cash flow under both methods is similar; however, the indirect method is preferred by many companies due to its less complicated nature. The method of calculating net cash flow from investing and financing activities remain the same irrespective of direct or indirect method is used.

参考
1. “Statement of Cash Flows Direct Method | Format | Example.” My Accounting Course. N.p., n.d. Web. 10 May 2017. .
2. “IAS Plus.” Statement of cash flows: Key differences between U.S. GAAP and IFRSs. N.p., 28 July 2014. Web. 10 May 2017. .
3. “Statement of Cash Flows Indirect Method | Format | Example.” My Accounting Course. N.p., n.d. Web. 10 May 2017. .

Image Courtesy:
1. “Cash Flow” (CC BY-SA 3.0)via蓝色钻石画廊