Fund Flow Statement and Income Statement| Accounting

The upcoming discussion will guide you about the difference between fund flow statement and income statement.

Difference # Fund Flow Statement:

1. There is no prescribed format for preparing a Fund Flow Statement.

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2. While preparing the statement both capital and revenue items are considered.

3. Income Statement helps the preparation of Funds Flow Statement. It is comple­mentary to Income Statement.

4. It highlights the changes in the financial position of a business and indicates the various means by which funds were obtained during a particular period and the ways to which these funds were employed.

Difference # Income Statement:

1. It is prescribed in a prescribed form.

2. Only revenue items are considered.

3. Income Statement is not prepared from Funds Flow Statement.

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4. It does not reveal the inflows and outflows of funds but depict the items of expenses and income arrive at the figure of profit or loss.

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