Statement of Cash Flows — Investing and Financing Activities
Investing Activities
This section records cash movements relating to long-term assets:
Investing Activities £
Purchase of non-current assets (xxx)
Proceeds from disposal of non-current assets xxx
──────────────────────────────────────────────────────────
Net cash used in investing activities (xxx)
- Purchase of NCA — cash outflow; full cost including delivery/installation
- Proceeds from disposal — the actual cash received (sale proceeds), NOT the NBV or any profit/loss figure
Financing Activities
This section records cash movements relating to how the business is financed:
Financing Activities £
Proceeds from issue of share capital xxx
Repayment of long-term borrowings (xxx)
Dividends paid (xxx)
──────────────────────────────────────────────────────────
Net cash from/(used in) financing activities xxx
| Item | Cash effect |
|---|
| Share issue (ordinary or rights) | Inflow — nominal + premium |
| Bonus issue | Not included — no cash changes hands |
| Loan advance / debenture issue | Inflow |
| Loan repayment / debenture redemption | Outflow |
| Dividends paid | Outflow |
Reconciliation
Net increase/(decrease) in cash and cash equivalents xxx
Cash and cash equivalents at beginning of year xxx
Cash and cash equivalents at end of year xxx
Cash and cash equivalents include bank balances and overdrafts. A bank overdraft is a negative balance.
Full Example: McDonnel & Prince Plc (Year ended 31 January 2026)
| £ |
|---|
| Profit from operations | 2 165 000 |
| Add: Depreciation | 215 000 |
| Less: Profit on disposal | (15 000) |
| Less: Increase in inventories | (10 000) |
| Add: Decrease in trade receivables | 20 000 |
| Less: Decrease in trade payables | (25 000) |
| Cash from operating activities | 2 350 000 |
| Less: Interest paid | (40 000) |
| Less: Tax paid | (300 000) |
|