The Cash Flow Statement for Manadi Plc for the year ended 31 December 2008 is as follows: Cash flows from operating activities Cash generated from operations (see note below) Finance costs paid Tax paid Net cash from operating activities Cash flows from investing activities Purchase of property, plant and equipment Proceeds from sales of property, plant and equipment Interest received Net cash used in investing activities Cash flows from financing activities issue of long-term interest-bearing borrowings Dividends paid Net cash used in financing activities Net increase in cash and cash equivalents Cash and cash equivalents at start of period Cash and cash equivalents at end of period Note: Reconciliation of profit before tax to cash generated from operations Profit before tax Finance cost Investment income Depreciation charge Loss on sale of property, plant and equipment Decrease in inventories (E496m-480m) Increase in trade and other receivables (584m-320m) Increase in payables (E824m-624m) Cash generated from operations Em 1,036 (80) 660 40 400 376 160 536 640 80 (40) 380 24 16 (264) 200 1.036 Required: a) Analyse the statement of cash flows of Manadi pic for the year ended 31 December 20x8 and discuss the company's cash management over the year. (Word count guidance: 400-500 words) b) Explain the purpose of a statement of cash flows and discuss why a statement of cash flows is useful for a business.