USERS’ PERCEPTION ON CASH FLOW REPORTING PRACTICES IN MAURITIUS

Vidisha Gunesh Ramlugun and Priscille Hosanee
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Vidisha Gunesh Ramlugun: University of Mauritius
Priscille Hosanee: University of Mauritius

Studies in Business and Economics, 2014, vol. 9, issue 3, 82-96

Abstract: The IASB and the FASB are currently proposing that cash flow statements under the direct method be mandatory for all firms under the harmonized cash flow reporting requirements. The study investigates which cash flow reporting method is perceived as being more useful among users in Mauritius. The aim is to assess whether the direct method will favorably be integrated in reporting practices of Mauritian companies. A questionnaire was developed and surveyed for data collection. Findings reveal that users have a preference for the direct cash flow reporting method as far as relevance, reliability and decision usefulness are concerned. But we report a weak mean difference among them. In addition, as far as understandability is concerned, results suggest that users prefer the indirect method. This paper purports to contribute towards the on-going debate about which cash flow reporting method is more useful.

Keywords: Cash flow statement; direct method; indirect method; Mauritius (search for similar items in EconPapers)
Date: 2014
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