Handbook: Statement of cash flows
Handbooks | March 2026
Latest edition: Our comprehensive guide to the statement of cash flows, with Q&As and examples to explain key concepts.
We explain cash flow classification issues and noncash disclosure requirements in detail, with special attention to recent SEC statements. We provide new and updated interpretive guidance on applying ASC 230 to many areas, including stablecoins, transactions under common control, debt syndications and more.
Applicability
- All entities
Relevant dates
- Effective immediately
A statement of importance
The statement of cash flows is a central component of an entity’s financial statements. Potentially misunderstood and often an afterthought when financial statements are being prepared, it provides key information about an entity’s financial health and its capacity to generate cash.
The underlying principles in ASC 230 (statement of cash flows) seem straightforward. Cash flows are classified as either operating, financing or investing activities depending on their nature. But identifying the appropriate activity classification for the many types of cash flows can be complex and regularly attracts SEC scrutiny, which is expected to continue.
This Handbook provides an in-depth look at statement of cash flows classification issues and noncash disclosure requirements. We’ve organized it by transaction type, making it easier to identify the answers to the common and not so common questions that you may have. And for practical issues where the guidance remains unclear, we offer our views on how to classify many of these cash flows.
Report contents
- Recent ASUs
- Objective and scope
- Format of the statement
- Classification principles
- Interim reporting
- Cash, cash equivalents and restricted cash
- Working capital accounts
- PP&E and other productive assets
- Investments
- Securitization and other transfers of financial assets
- Lending activities
- Debt financing transactions for debtors
- Derivative instruments
- Leases
- Employee benefit plans
- Share-based payment arrangements
- Contingencies and insurance premiums and proceeds
- Business combinations
- Transactions with shareholders
- Discontinued operations
- Foreign currency matters
- NFP entities
- Government grants received by for-profit entities
- Crypto intangible assets
- Insurance entities
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Statement of cash flows
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