The Statement of Cash Flows
Evolution of the Statement of Cash Flows
Before 1971,the income statement and the balance sheet were the only financial statements required under GAAP. However, many large firms were including additional financial statements to disclose relevant information needed to make economic decisions. These disclosures were in response to investors, creditors, and others who voiced the desire to receive information on the financing and investing activities of business organizations. A number of companies responded by issuing a funds statement. This statement reported on the resources provided and the uses to which these resources were put during the reporting period.