Problem 1. Published financial statements are historical. If so, how can they be used to forecast the future?
Problem 2. Discuss the interlocking connections among the three primary financial statements and explain why conventional reporting of financial information does not provide complete information upon which financial decisions can be made.
Problem 3. The cash flow summary tells the financial manager about the differences between the cash inflows, cash outflows, and the reasons these flows have happened.
a. What does the cash flow report not tell the financial managers, investors, lenders, and other stakeholders?
b. How could this information affect these stakeholders and their participation in the financing of the organization?
c. What do you think a dot.com cash flow statement would have shown or indicated to potential investors?