Cash Flow Statement According to IASB Recommendations and Croatian Accounting Standards

The basic framework that allows the prediction of cash flows in a certain retail chain is the Statement of Cash Flow. Content, structure, form and permitted methods of preparation of a cash flow statement are prescribed by the IASB accounting standards, more specifically by the International Accounting Standard (IAS) 7. IAS 7 emphasizes that the information regarding the cash flows of a company helps the users of financial statements to provide the basis for assessment of a company on achieving the cash and the cash equivalents, the need of the company to use the cash flows i.e. the time frame and to achieve certainty. In Croatia, the obligation of compiling and reporting statements of cash flows has been prescribed for all businesses except for craftsmen. Through the statement of cash flow it is possible to obtain trilateral information - information on conducting business, the possibilities of payment of liabilities and the return of surplus cash to the investors. As it is of the multiple importance of the cash flow statements in the business environment, the basic characteristics of the stated report will be presented on the practical example and determine the significance of compiling the statements of cash flows.