Limitations of Fund Flow Statement
- As the fund flow statement is just repositioning of data of a provided financial statement, it lacks resourcefulness in a factual sense.
- Fund flow statement does not forecast a firm’s future performance. Its indication is related to the performance of the previous year.
- It is unable to show accuracy when used for preparing an expected fund flow statement.
- It cannot show any constant changes. The reason revolves around the fact that only 2 specific years can be taken for the purpose of analysis.
- This statement cannot be taken as an alternative for a financial statement.
Links of Previous Main Topic:-
- Introduction to accounting and branches of accounting
- Preparation of final accounts
- Introduction of fund flow statement
Links of Next Finance Topics:-
- Steps in preparation of fund flow statement
- Problems and solutions fund flow statement
- Minimization problems
- Learning objectives the transportation problems
- Special case of traveling sales man problem
- Replacement theory learning objectives and chapter outline
- Learning objectives and chapter outline for waiting line queuing theory