Question

In: Finance

What does "Proceeds from initial public offering and private placement, net underwriting of discounts and commissions...

What does "Proceeds from initial public offering and private placement, net underwriting of discounts and commissions and other offering cost" and "proceeds from international employee stock sales to be remitted to employees and tax authorities" mean in the cash from financing activities section of the cash flow statement mean?

Solutions

Expert Solution

Cash flows from financial activities will be reflecting the cash flows in relation to the financial decision making which will involve raising of equity capital and raising of debt capital along with payment and redemption of equity and debt capital.

So, proceeds from internal public offering and private placement along with net underwriting of discount and commission and other offering cost along with proceeds from International employee stock sales to be remitted to the employee and tax authorities are reflected in the financial segment of the cash flows because these are related to the financial activities and they are reflecting the generation of capital or raising of equity or redemption of capital in the organisation so it is reflective of financial activities of the organisation so all these transactions if they are done in cash or to be reported in to the cash flows in order to present a fair view of cash flows from the financial activities of the organisation.


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