Equity Income

CFA Level II
#21

yeah, sorry, should have been more specific - the purchase will show up in the cash flow statement - i’m talking about whether or not income from the affiliate other than dividends shows up in the cash flow statement (i didn’t think it does.)

#22

Let me go check my notes, brb

#23

i’m pretty sure it doesn’t. it would mean that a whole bunch of cash would would have to be leaving the affilate and going to the parent, doesn’t make any sense.

#24

Ali you’re right. Only the funds used in the acquisition hit the Cash flow stmt. BUt dividends received def have to the Cash flow stmt because you’re receiving money, right?

#25

yeahhhhhhhh it’s a celebration http://www.youtube.com/watch?v=0zvDmLnBgTs

#26

JP_RL_CFA Wrote: ------------------------------------------------------- > Ali you’re right. Only the funds used in the > acquisition hit the Cash flow stmt. BUt dividends > received def have to the Cash flow stmt because > you’re receiving money, right? yes dividends affect the cash flow statement, they will also reduce the value of your investment in the subsidiary.

#27

JP_RL_CFA Wrote: ------------------------------------------------------- > Ali you’re right. Only the funds used in the > acquisition hit the Cash flow stmt. BUt dividends > received def have to the Cash flow stmt because > you’re receiving money, right? Right. Paid out of retained earnings from the company you invested in. Assets of the investee go down (cash decrease) as well as equity (retained earnings).

#28

so that would be a CFO inflow? Btw what’s up guys? how’s things? lol. this lvl 2 material blows. I got accting down and equity. Struggling with everything else lol

#29

yeah dividends received are CFO under U.S. GAAP., CFO or CFI under IFRS yeah L2 is pretty bad, it’s a little bit harder than i expected it to be- hopefully the next 2 weeks will enough to pound all this shit into my head. the whole new “assume IFRS unless otherwise stated” thing is a mindfuck.

#30

I just hope they don’t give us an IFRS hyper inflation question lol

#31

It sucks bad. I just want to get this over with. How about you?

#32

same man. I just wanna start working out again and be able to sit down, drink a beer and watch a Yankee game without feeling guilty. Starting to think that taking lvl 2 right after lvl 1 was a mistake. My mind is totally fried.