(125)-LINKS WITH CASH FLOW AND OTHER PRIMARY STATEMENTS

Links with Cash Flow and Other Primary Statements

Because the information given by a cash flow statement is best appreciated in the context of the information given by the other primary statements, the Financial Reporting Standards (FRS) requires two reconciliations, between:

• Operating profit and the net cash flow from operating activities
• The movement in cash in the period and the movement in net debt

The movement in net debt should identify the following components and reconcile these to the opening and closing balance sheet amount:

• The cash flows of the entity
• Other non cash changes
• The recognition of charges in market value and exchange rate movements

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