Many students arrive at the correct net cash change at the bottom of the statement but still lose 3 to 4 marks due to misclassification.
The 3 Critical Omissions
- Income Tax Paid: Deducted at the very end of Operating Activities after 'Cash generated from operations'.
- Interest and Dividends: In Nepal standards, interest paid is categorized under financing, while interest received belongs under investing.
- Non-Cash Transactions: Conversion of debentures to equity must be disclosed in notes, not forced into cash flows.
