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Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FA – FIA FFA › Cash flow
State whether the following statements is true or false? The amortisation charge for the year on intangible assets will appear as an item under ‘Cash flows from operating activities’ in a statement of cash flows
Sir, correct answer is TRUE…Why?As this charge only used for adjustment to profit before tax however it isn’t included cash flow statement, it is non cash transaction
But when using the indirect method, we start with the profit and then adjust by non-cash items when getting the cash flows from operating activities.