The Institute of Chartered Accountants of India (ICAI) issued the Accounting Standard (AS.3) (revised) relating to the preparation of cash now statement (CFS) in 1998. Initially, it was recommendatory in nature, its preparation has been made mandatory for accounting period on or after April 1, 2001 for enterprises (i) which have either turnover of more than Rs 50 crore in a financial year or (ii) the shares of which are listed in stock exchange. The CFS of Ltd companies should be presented as per the indirect method presented in As-3. This Section explains and the CFS mandated by the ICAI on the basis of actual cases or Reliance. State Bank of India and a comprehensive example of Asian Paints.

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