Abstract

This study focused on the cash flow statement by three dimensions. These dimensions are: 1) methods of cash flow statement preparation, 2) the purpose of preparing cash flow statement and 3) the effect of cash flow statement on investment decisions. The two researchers measured the importance of each statement in each dimensions and find if there is any effect on the annual financial statements users’ characteristics (gender, age, educational level, experience and job) on these importance by using questionnaire methods which was distributed to 92 annual financial statements users in Iraq.
The study concludes that the cash flow statement assists financial management in assessing the need for borrowing and expansion in investment and finance activities. Besides that, the cash flow statement provides information not included in the other annual financial statements.