F6 M2 Not For Profit Financial Reporting Part 2

Question 1

what is the purpose of the statement of cash flows?

Answer 1

provide info on cash receipts and payments for operating, investing, and financing activities

Question 2

examples of cash transactions related to operating activities

Answer 2

1) settlement of lawsuits
2) insurance settlements
3) refunds from suppliers or to customers
4) charitable contributions
5) program income
6) interest or dividend income
7) sale of financial assets
8) interest payments
9) receipts of unrestricted sources
10) crypto assets converted into cash

Question 3

examples of cash transactions related to investing activities

Answer 3

1) property, plant, and equipment
2) sales or purchases of works of art
3) sale of assets restricted to investment in equipment

Question 4

examples of cash transactions related to financing activities

Answer 4

1) proceeds from issuing bonds, mortgages, notes, ST or LT borrowing
2) repayment of borrowings
3) contributions received for capital projects
4) contributions for donor-restricted endowment fund
5) donor restricted crypto assets for capital use immediately converted to cash

Question 5

are transfers of cash and cash equivalents that are restricted reported on statement of cash flows?

Answer 5

No

Question 6

name the noncash transactions that should be disclosed in the statement of cash flows (4)

Answer 6

1) contributed securities
2) CIP and asset purchases in AP
3) contributions of beneficial interest
4) noncash debt refinancing transactions (ex. changes in interest rates)

Question 7

are not for profits using direct method of reporting net flows from operating activities required to provide a reconciliation of change in net assets?

Answer 7

No