The direct method of reporting operating cash flows:
A) Is recommended but not required by the IASB.
B) Must be used by all companies.
C) Is used by most companies.
D) Is considered supplementary disclosure.
E) Is not recommended by the IASB, but is commonly used.

Question

Quizplus · Accepted Answer

The direct method of reporting operating cash flows is recommended but not required by the International Accounting Standards Board (IASB). However, most companies still choose to use this method as it provides a more detailed and transparent view of cash flows.

The Direct Method of Reporting Operating Cash Flows