Usefulness of Statement of Cash Flows: Evidence from Malaysian Analysts Available to Purchase

This study examines the perceptions of Malaysian investment analysts on the usefulness of statement of cash flows compared with other sections in the annual report. Namely, the Chairperson's Statement, Director's Report, Profit & Loss Account, Balance Sheet, Auditor's Report, and the Notes to the Financial Statements. The inference of this study, drawn from a mail survey, suggests that investment analysts perceive the statement of cash flows to be as useful as the balance sheet and less useful than the profit and loss account but more useful than the other sections forming the basis of the study. It is read less thoroughly than the balance sheet and profit and loss account and poses greater difficulty in understanding, however, surprisingly, requires less explanation. A comparison with a prior New Zealand study indicates differences between the two studies. Plausible reasons are proffered for these differences.