Because we come across the item Equity Share Capital in most of the problems and illustrations relating to Funds Flow analysis, we may be driven to the misconception that such an analysis is meant only for company form of organisations.
Funds flow analysis is meant for analysing the changes in the balance sheet over a period of time. Such an analysis is possible in relation to balance sheets of any form of business organisation.
In balance sheets of forms of business organisations other than a company, we do not find the items like Equity Share Capital, Preference Share Capital, etc., which are specific to the company form of organisation.
But for the presence or absence of these, there is no difference in analysing Funds Flow for a Corporate entity and a Non-Corporate entity.
