Question:
Canadian Tire Corporation, Limited's cash flow statement for the years ended December 28, 2013, and December 29, 2012, is reproduced below:
Adapted from the Canadian Tire Annual Report 2013. Reprinted with permission.
Required
1. Which format did Canadian Tire Corporation, Limited use for reporting cash flows from operating activities?
2. What was Canadian Tire's largest source of cash during the year ended December 28, 2013? During the previous year December 29, 2012?
3. What was Canadian Tire's largest use of cash during the year ended December 28, 2013? During the year ended December 29, 2012?
4. Which section-operating, investing, or financing-did Canadian Tire have the largest source of cash shown for 2013 and 2012? Comment on your findings.
5. During the year ended December 28, 2013, Canadian Tire has a large negative cash flow from investing activities. Does this mean Canadian Tire is expanding, downsizing, or remaining stable?
6. Why are Canadian Tire's year ends shown as December 28, 2013, and December 29, 2012?
Transcribed Image Text:
CANADIAN TIRE CORPORATION, LIMITED Consolidated Cash Flow Statement (adapted) For the Years Ended (Dollars in millions) Operating activities Net income Adjustments for: December 28, 2013 December 29 $ 564.4 $ 498.9 Gross impairment loss on loans receivable Depreciation on property and equipment Income tax expense Net finance costs Amortization of intangible assets Changes in fair value of derivative instruments Gain on disposal of property and equipment Other 326.1 253.8 220.2 105.8 323.7 248.9 126.2 86.2 (10.3) 15.1 Cash generated from operations 1,467.5 Change in operating working capital and other Change in loans receivable Change in d Interest paid Interest received Income taxes paid 270.2 (600.2) (96.2) (126.5) 12.0 (191.2) 796.8 (521.7) 134.7 (155.3) (161.3) 743.0 Cash generated from operating activities Investing activities (58.0) (339.2) Acquisition of Pro Hockey Life Sporting Goods Inc. Acquisition of short-term investments Proceeds from the maturity and disposition of short-term investments Acquisition of long-term investments Proceeds from the disposition of long-term investments Additions to property and equipment Proceeds on disposition of property and equipment Additions to intangible assets Long-term receivables and other assets Other (264 (193.8) 360.7 (404.3) (105.9) 17.2) (222.3) 45.0 (261.5) (233.7) (240.3) Cash used for investing activities Financing activities Net repayment of short-term borrowings Issuance of loans payable Repayment of loans payable Issuance of share capital Repurchase of share capital Issuance of long-term debt Repayment of long-term debt and finance lease liabilities Dividends paid Other (248.5) (105.9) 265.8 (659.2) (113.0) 274.0 (365.5) (355.1) 929.5 (0.2) $ 574.2 97.7) Cash (used for) generated from financing activities Cash (used) generated in the year Cash and cash equivalents, beginning of year Effect of exchange rate fluctuations on cash held Cash and cash equivalents, end of year 247.0 728.5 201.0 $ 929.5