This module covers the statement of cash flows, which is derived from the firmís balance sheets and income statement. Students first read chapter 4 of Understanding Financial Statements, ninth edition, by Lyn M. Fraser and Aileen Ormiston, then view the on-line presentation. Topics covered include: the types of cash flows within the cash flow statement; how to generate a cash flow statement if the debtor does not provide one; and why the cash flow statement is particularly relevant for creditors. The module concludes with a problem assignment on generating the cash flow statement from the debtorís balance sheets and income statement.
Dr. Frederick C. Scherr is a Professor Emeritus of Finance at the College of Business and Economics at West Virginia University, where he taught for 30 years and won both the Collegeís Outstanding Teacher and Outstanding Researcher awards. He is the author of more than 30 research articles, four textbooks, and many articles in professional publications such as The Credit and Financial Management Review, The Credit Manager, and Business Credit. He has done extensive work in adult education for the National Association of Credit Management, including teaching at the Graduate School of Credit and Financial Management, and for private corporations.