What is a rationale for preparing a statement of cash flows,according to AASB 107?
A) Assessing the ability of an entity to generate cash and cash equivalents
B) Needs of the entity to utilise cash flows
C) Both A and B are rationales for preparing a statement of cash flows
D) Neither A nor B is considered a rationale related to the statement of cash flows

Question

Quizplus · Accepted Answer

According to AASB 107, preparing a statement of cash flows is necessary to assess an entity's ability to generate cash and cash equivalents and to fulfill its cash flow requirements. Therefore, both options A and B are valid rationales for preparing a statement of cash flows.

What Is a Rationale for Preparing a Statement of Cash