# ASC 230-10-10: Statement of Cash Flows — Overall — 10 Objectives

Source: FASB Accounting Standards Codification, Basic View

[Read online](https://asc.understandingaccounting.org/asc/230/10/#10-objectives)

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## ASC 230-10-10: 10 Objectives

[Read section](https://asc.understandingaccounting.org/asc/230/10/#10-objectives)

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##### [230-10-10-1](https://asc.understandingaccounting.org/asc/230/10/#230-10-10-1)

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The primary objective of a statement of cash flows is to provide relevant information about the [cash](https://asc.understandingaccounting.org/glossary/c/#cash "Consistent with common usage, cash includes not only currency on hand but demand deposits with banks or other financial institutions. Cash also includes other kinds of accounts that have the general characteristics of demand deposits in that the customer may deposit additional funds at any time and also effectively may withdraw funds at any time without prior notice or penalty. All charges and credits to those accounts are cash receipts or payments to both the entity owning the account and the bank holding it. For example, a bank's granting of a loan by crediting the proceeds to a customer's demand deposit account is a cash payment by the bank and a cash receipt of the customer when the entry is made.") receipts and cash payments of an entity during a period.

##### [230-10-10-2](https://asc.understandingaccounting.org/asc/230/10/#230-10-10-2)

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The information provided in a statement of cash flows, if used with related disclosures and information in the other financial statements, should help investors, creditors, and others (including donors) to do all of the following:

1.  a
    
    Assess the entity's ability to generate positive future net cash flows
    
2.  b
    
    Assess the entity's ability to meet its obligations, its ability to pay dividends, and its needs for external financing
    
3.  c
    
    Assess the reasons for differences between net income and associated cash receipts and payments
    
4.  d
    
    Assess the effects on an entity's financial position of both its cash and noncash investing and financing transactions during the period.