Drafting a Professional Email

You are a staff auditor reviewing the Statement of Cash Flows for Auto Corp (the client). The senior on your audit team (Robin) has asked you to research whether the client has appropriately classified the proceeds from the sale of its manufacturing facility as cash flows from investing activities. Draft an email response to Robin's question. Use the Codification guidance in Figure 4-1 to support your response.

Figure 4-1

Codification excerpt for email exercise (ASC 230-10, Statement of Cash Flows)

> Classification 45-10 A statement of cash flows shall classify cash receipts and cash payments as resulting from investing, financing, or operating activities. > > Cash Flows from Investing Activities 45-11 Cash flows from purchases, sales, and maturities of available-for-sale debt securities shall be classified as cash flows from investing activities and reported gross in the statement of cash flows. 45-12 All of the following are cash inflows from investing activities: a. Receipts from collections or sales of loans made by the entity and of other entities' debt instruments (other than cash equivalents, certain debt instruments that are acquired specifically for resale . . . , and certain donated debt instruments received by not-for-profit entities (NFPs) . . .) b. Receipts from sales of equity instruments of other entities . . . and from returns of investment in those instruments c. Receipts from sales of property, plant, and equipment and other productive assets . . .

Please draft a Professional Email