PAS 7 – Statement of Cash flows
Cash – most liquid assets, cash on hand and demand deposits unrestricted.
Cash Equivalents – Short term highly liquid investments readily convertible to cash.
*Presented as one line item in the balance sheet.
Included as part of Cash:
- Current Account
- Checking Account
- Demand Deposit
- Time Deposit – Problem silent (part of cash equivalent).
- Travellers Check and Money Order.
- Money Market Placement – 3 months acquired before date of maturity.
- T – Bills – 3 months acquired before date of maturity.
Excluded from Cash:
- Postdated Checks.
- Foreign account restricted to withdrawal.
- Compensating Balance restricted.
- NSF Checks.
- Money on closed bank account.
- Bank overdraft – Current Liability (can be offset if maintained with same Bank Account ).