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Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FR Exams › Finance costs-cash flows indirect method.
Dear Chris
Before you put them into operating activities finance costs were called finance costs. After you put them into operating activities finance costs changed their name to interest paid. Why does this happen ?
Hi,
It is because the finance cost is what is expensed and this is not the same as what it paid in the year. We are likely to have opening and closing accruals to adjust the fiance cost to get the cash paid.
Thanks
thanks for explaining this to me
No worries, you are welcome!