How Cash Flow Classification Can Mislead Financial Statement Users

Course Overview

This course walks through common ways companies can influence reported cash flow through classification decisions. It focuses on practices such as presenting financing inflows as operating cash flows, factoring receivables, and using supplier finance programs. Along the way, it shows how these choices can change reported operating cash flow and liquidity measures, and why those changes matter when analyzing the financial statements. 

Learning Objectives

Upon completion of this course, you will be able to:

• Identify ways cash flows can be misclassified to inflate operating cash flow

• Recognize the impact of reclassifying financing activities on liquidity metrics

• Differentiate between legitimate and manipulative classification of receivables and supplier finance

• Determine how classification choices affect financial statement analysis