Create a Cash Flow Category

Overview

The Accounting Seed Cash Flow statement is a tool to report on cash coming in and out of your business. The Cash Flow Statement can be enabled from the Enablements screen.

A Cash Flow Statement reports on cash generated and spent during a period. A Cash Flow Statement can be prepared using either the Direct Method or Indirect Method. Both the FASB (Financial Accounting Standards Board) and U.S. Securities and Exchange Commission (SEC) encourage the use of the Direct Method of Cash Flow. The Direct Method is the one supported in Accounting Seed.

The difference between the two methods is primarily the starting point. With the Indirect Method, you start with Net Income and adjust for non-cash items to arrive at the net change in cash. On the other hand, with the Direct Method, cash inflows and cash outflows are presented, and the cash outflows are subtracted from cash inflows to determine the net change in cash.

Important: If you are activating this feature after your initial Go Live, the feature cannot generate a Cash Flow Statement until the accounting year following the year you activate the feature.  This is because all cash related transactions (Cash Disbursements, Cash Receipts and Journal Entries to a cash account) in a fiscal year are required to be tagged with a Cash Flow category in order to generate a Cash Flow Statement.

Create a Cash Flow Category

Note: Cash Flow Categories are implemented in Accounting Seed with the GL Account object.

1. Navigate to Accounting Home and click the Setup tab. Then, under the Ledger menu, click General Ledger Accounts. 
2. Click New.
3. Enter the name of the new Cash Flow Category.
4. Change Type value to Cash Flow.
5. Set the appropriate Sub Type 1 value (Operating, Investing, or Financing).
6. Click Save.
   * Sub Type 2 is not used in the creation of a Cash Flow Statement.

If you do not see Cash Flow as a Type or the three Sub Type 1 values, then you will need your Salesforce administrator to activate the Type field value Cash Flow, as follows:

1. Click Setup | Object Manager. Enter General Ledger Account in the Quick Find textbox and then, select General Ledger Account.  
2. Under Fields & Relationships, click the Type field and scroll down to activate the Type value: Cash Flow.
   
   
   
   
3. Go back to the GL Account object and select the Sub Type 1 field and scroll down and activate the three Sub Type 1 values: Operating, Investing, Financing.
   
   
   
   
4. Go back to the GL Account object and select the Type and scroll down to the Field Dependencies.
   
   
5. Click Edit next to the Sub Type 1 field.
   
   
6. In the Cash Flow column, double-click on the Operating, Financing, and Investing fields. This will change the color so that they are active fields under the Cash Flow type.
   
   

You can now create your own cash flow categories as described above.

Note: The Cash Flow Categories included with Accounting Seed will display in a specific order on the Cash Flow Statement.  New Cash Flow Categories added will list at the bottom of their Sub Type 1 list in alphanumeric order.

Set of Cash Flow Categories installed with Accounting Seed

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