alohachris
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The Income Statement shows you how the Profit or Loss for the Period is arrived at. Under IAS 1.81, as a minimum, the face of the income statement shall include line items that present the following amounts for the period:
(a) revenue;
(b) finance costs;
(c) share of the profit or loss of associates and joint ventures accounted for using the equity method;
(d) tax expense;
(e) a single amount comprising the total of (i) the post-tax profit or loss of discontinued operations and (ii) the post-tax gain or loss recognised on the measurement to fair value less costs to sell or on the disposal of the assets or
disposal group(s) constituting the discontinued operation; and
(f) profit or loss.
The cash flow statement reports cash flows during the period classified by operating, investing and financing activities.
IAS 7.11 says:
An enterprise presents its cash flows from operating, investing and financing activities in a manner which is most appropriate to its business. Classification by activity provides information that allows users to assess the impact of those activities on the financial position of the enterprise and the amount of its cash and cash equivalents. This information may also be used to evaluate the relationships among those activities.
So as you can see, the 2 statements present different things and serve different purposes. For purposes of illustration, I have attached the income statement (called statement of earnings here) and statement of cash flows of IBM so you can see what they can contain and how different they are.
Both these statements are historical statements. They refer to the period just ended. Cash flow projections and profit forecasts are usually internal documents and do not form part of the audited financial statements.
 Posted 538 days ago
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