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ar-abdulshafi
Level 2

Why do QB consider short-term loan as an "operating" activity in CFS?

Hi,

I got this reply from one of QB's  respected agent on a question about short-term loans found in cash flow statement among "operating" activities instead of "financing" ones. Any further explanation about this QB rule regarding the loans.

 

Thanks

3 Comments 3
Rustler
Level 15

Why do QB consider short-term loan as an "operating" activity in CFS?

The only thing I can think of is that "operations" is classified as short term, a year or less

ar-abdulshafi
Level 2

Why do QB consider short-term loan as an "operating" activity in CFS?

Thanks for replying. 

However, according mg knowledge, standard CFS rules state that ALL loans - short or long term - are reported under "financing" activity section, NOT "operating" one.

 Kindly read this:

https://www.accountingcoach.com/blog/bank-loans-on-cash-flow-statement

 

And my question is about real situation I found in my cash flow statement in QB online (3 short term loans are recorded in "operating" section!) 

 

Still I am waiting someone to explain why this occurred jn QB CFS despite the 3 short-term loans were recorded properly as loan payable (current liabilities account)

 

Thank you one again for your participation in this conversation.

JelB
Level 1

Why do QB consider short-term loan as an "operating" activity in CFS?

My observation is that you'd have to make it long term in the settings. Then I selected Other for the tax (which I'm concerned with), but I totally agree with you. 

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