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You said the first thing we do is fill in cash b/f and cash c/f, and then you know what the cash for the year should be.
How do you get the cash b/f and c/f?
From the Statements of Financial Position.
Brought forward figure is in last year’s Statement of FP and carry forward is in this year’s Statement of FP.
BEWARE three points!
+(1) Beware the sign change – most often, the F7 examiner will have an overdraft brought forward but a positive balance carried forward – so be VERY careful
(2) Beware the existence (or possible existence) of the cash equivalents – they may be mentioned in an explanatory note, hidden deep within the question
(3) It is POSSIBLE that the examiner directs you to deal with an overdraft as part of financing rather than (as I always do) treating it as part of cash and cash equivalents. I cannot remember ever a situation where the examiner has given that direction, but he could – so be ready for it!
And good luck tomorrow
So cash is all cash + cash equivalents + overdraft
Or is it minus overdraft?
And is it only the overdraft or other current liabilities as well?
It’s MINUS the overdraft.
Yes, it’s only the overdrafts and certainly not any other current liabilities (I suppose it COULD include loans repayable within three months, but that would be very unusual) So, from current liabilities, you’ll take just the overdraft. Trade payables are dealt with in Changes in Working Capital, Interest accruals are dealt with in the calculation of interest paid, tax liability also dealt with as a separate calculation, and dividends too
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