ASU 2016-18 Statement of Cash Flows - Restricted Cash
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Transcript of ASU 2016-18 Statement of Cash Flows - Restricted Cash
GUIDANCE ABOUT RESTRICTED CASH IN
CASH FLOW STATEMENTSASU 2016-18
WHY THE NEW STANDARD?
DIVERSITY EXISTS IN THE
CLASSIFICATION AND
PRESENTATION OF CHANGES IN
RESTRICTED CASH
ENTITIES CLASSIFY TRANSFERS BETWEEN
CASH AND RESTRICTED CASH AS OPERATING,
INVESTING, OR FINANCING ACTIVITIES, OR AS A
COMBINATION OF THOSE ACTIVITIES
THE DIVERSITY CREATES CONFUSION
WHO IS AFFECTED?
THE AMENDMENTS IN THIS UPDATE
APPLY TO ALL ENTITIES THAT HAVE RESTRICTED CASH
OR RESTRICTED CASH EQUIVALENTS AND ARE
REQUIRED TO PRESENT A STATEMENT OF CASH FLOWS
WHAT ARE THE MAIN PROVISIONS?
REQUIRES THAT A STATEMENT OF CASH FLOWS
EXPLAIN THE CHANGE DURING THE PERIOD IN THE
TOTAL OF CASH, CASH EQUIVALENTS, AND AMOUNTS
GENERALLY DESCRIBED AS RESTRICTED CASH OR
RESTRICTED CASH EQUIVALENTS
RESTRICTED CASH IS INCLUDED IN THE DEFINITION
OF CASH
WHEN EFFECTIVE?
PUBLIC COMPANIES: YEARS BEGINNING AFTER
DECEMBER 15, 2017
OTHER ENTITIES: YEARS BEGINNING AFTER
DECEMBER 15, 2018
CAN BE EARLY IMPLEMENTED
DISCLOSURES
THE NATURE OF
RESTRICTIONS ON ITS CASH AND
CASH EQUIVALENTS
ON THE FACE OF THE CASH FLOW STATEMENT OR
IN THE NOTES, A DETAIL OF
BALANCE SHEET LINES COMPRISING THE
YEAR-END CASH TOTAL
Sample Disclosure
Cash and cash equivalents $12,500
Restricted cash - short term 3,000
Restricted cash - long term 10,000
Total cash, cash equivalents and restricted cash
Total per Cash Flow Statement
$25,500
CHARLES HALL, CPA, CFE, MACC
CPA-Scribo.com