IFRS for SMEs / Section 7: Statement of Cash Flows

Section 7: Statement of Cash Flows

Section 7 requires cash flows to be classified into operating, investing and financing activities, using the indirect or the direct method for operating cash flows.

Disclosures to look for

7.4–7.6 The classification of cash flows into operating, investing and financing activities.

Third edition (2025 changes)

A reconciliation of liabilities arising from financing activities (7.19A) and disclosures about supplier finance arrangements (7.19B–7.19C).

How Sight applies it

Each account's leaf decides the cash-flow class of its movement; loans to directors appear as investing flows. On the third edition the borrowings note reconciles financing liabilities.

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