How to forecast some Cash flow from investing activities
I am practicing some financial modelling and got stuck when modelling for some cash flow items
Cash flow from investing
-purchase of available for sale securities
-proceeds from sales of AFS securities
-Other
Can anyone provide some advice on how I should forecast these three items? Thanks in advance.
If this is a generic widget co, then I believe you don't assume any changes in afs (or other inter corporate investments). I think it only changes when you start modeling investment cos or other cos whose main business is dealing. Even then though, afs is for non-trading assets (FRS 139; sorry, as a new wso member, I couldn't link the KPMG report) so I would think this would be more appropriate for long-term, closely held assets, which doesn't seem like a good idea for anyone to attempt to forecast.
Cash Flow From Investing Activities (Originally Posted: 01/22/2018)
Going through the Cash Flow Statement, I'm wondering if Cash Flow from Investing Activities can ever be positive? This part shows how much cash is invested in long-term investments such as PP&E. So how would this ever by positive?
This can absolutely be positive. A sale of investments, for one, would result in positive cash flow to the company. Just about any cash flow statement will have both positive and negative entries under this section.
Asset disposals are an example of positive values in that section.
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