Direct Method

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Dictionary Says

Definition of 'Direct Method'

A method of creating a statement of cash flows during a given reporting period. The method uses actual cash flow information from the company's operations segment, instead of using accrual accounting values.

Under both the direct and indirect method, the presentation of the cash flow from investing and financing activities will be identical.
Investopedia Says

Investopedia explains 'Direct Method'

Under the direct methods, the only section of the cash flow statement that will differ in presentation is the cash flow from operations section. Since the direct methods uses actual cash flow information, such as the actual cash outflow of all overhead expenses, there usually must be a different method of calculation for the company's internal controls.
Search results for

'Direct Method'

  • CFA Level 1 Study Guide - Financial Statements - Cash Flow ...

    http://www.investopedia.com/exam-guide/cfa-level-1/financial-statements/cash-flow-direct.asp
    Learn the direct method to calculating a cash flow statement. Includes
    calculations for free cash flow, a useful valuation measurement. ...

  • CFA Level 1 Study Guide - Financial Statements - Cash Flow ...

    http://www.investopedia.com/exam-guide/cfa-level-1/financial-statements/cash-flow-indirect.asp
    ... Statement; 6.20 Cash Flow Statement Basics; 6.21 Cash Flow Computations - Indirect
    Method; 6.22 Cash Flow Computations - Direct Method; 6.23 ...

  • Savings Accounts Not Always The Best Place For Cash Assets

    http://www.investopedia.com/articles/basics/09/disintermediation.asp
    ... The fact that a depositor uses a mutual fund arrangement to accomplish this does
    not change the fact that this is a direct method of investing. ...

  • How can I buy oil as an investment?

    http://www.investopedia.com/ask/answers/08/oil-as-investment.asp
    ... One direct method of owning oil is through the purchase of oil futures or oil futures
    options. Futures are highly volatile and involve a high degree of risk. ...

  • CFA Level 1 Study Guide - Financial Statements - Free Cash Flow ...

    http://www.investopedia.com/exam-guide/cfa-level-1/financial-statements/free-cash-flow.asp
    Learn the direct method to calculating a cash flow statement. Includes
    calculations for free cash flow, a useful valuation measurement. ...

  • Accounting Basics: Financial Statements | Investopedia

    http://www.investopedia.com/university/accounting/accounting5.asp
    ... Using the direct method, the accountant shows the items that affected cash flow,
    such as cash collected from customers, interest received, cash paid to ...

  • CFA Level 1 Study Guide - Assets - Choosing the Appropriate ...

    http://www.investopedia.com/exam-guide/cfa-level-1/assets/choosing-accounting-method.asp
    ... Statement; 6.20 Cash Flow Statement Basics; 6.21 Cash Flow Computations - Indirect
    Method; 6.22 Cash Flow Computations - Direct Method; 6.23 ...

  • CFA Level 1 Study Guide - Global Economic Analysis - Foreign ...

    http://www.investopedia.com/exam-guide/cfa-level-1/global-economic-analysis/foreign-exchange.asp
    ... Statement; 6.20 Cash Flow Statement Basics; 6.21 Cash Flow Computations - Indirect
    Method; 6.22 Cash Flow Computations - Direct Method; 6.23 ...

  • Forex Broker Guide: Advanced Features | Investopedia

    http://www.investopedia.com/university/forex-broker-guide/forex-broker-guide4.asp
    ... times, resulting in losses. A more direct method of accessing the forex
    markets may be the no dealing desk broker (NDD). This is a ...

  • Financial Statements: Revenue | Investopedia

    http://www.investopedia.com/university/financialstatements/financialstatements5.asp
    ... The virtue of the direct method is that it displays a separate line for "cash received
    from customers." Such a line is not shown under the indirect method, but ...

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