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CFI FMVA CORPORATE FINANCE INSTITUTE (CFI) – FINANCIAL
MODELING & VALUATION ANALYST (FMVA) FINAL CERTIFICATION
EXAM 2025 | REAL VERIFIED QUESTIONS & 100% CORRECT
ANSWERS || COMPLETE EXAM PACK || GUARANTEED PASS || BRAND
NEW & FULLY UPDATED
Income statement accounting
Accrual - revenues & costs recorded as a business earns or incurs them, not as it receives and
pays money
It includes them in the relevant period's income statement and matches them as closely as
possible
CF makes no difference whatsoever - IS where sale happens
=> How do you decide when sale happens? RECOGNIZE REV UPON DELIVERY OF
GOOD/SERVICE PERFORMED
Why are profits and cash flow not the same thing?
Accounting differences
The idea of matching over time
CFS Accounting
Only records transactions when cash is received
VS
IS records ALL revenues earned, whether in cash or accrued
Cash accounting method
record income and expenditures at the time the money changes hands
Cash accounting method
An accounting method in which income and expenditures are recorded at the time the money
changes hands.
Accrual Accounting
recording in each fiscal period applicable expenses, whether paid or not, and income earned,
whether collected or not.
Accrual Basis Accounting
reporting income when it is earned and expenses when they are incurred
Accrual Basis Accounting
,2|Page
the method of accounting that recognizes revenue when it is earned and matches expenses to the
revenues they helped produce
Accrual Basis Accounting
Accounting basis in which companies record, in the periods in which the events occur,
transactions that change a company's financial statements, even if cash was not exchanged.
accrued expenses
expenses incurred in one fiscal period but not paid until a later fiscal period
accrued expenses
expenses incurred but not yet paid in cash or recorded
Cash flow from operating activities
The net amount of cash provided from operating activities.
cash flow from financing activities
The idea of matching over time
CFS Accounting
Only records transactions when cash is received
VS
IS records ALL revenues earned, whether in cash or accrued
Cash accounting method
record income and expenditures at the time the money changes hands
Cash accounting method
An accounting method in which income and expenditures are recorded at the time the money
changes hands.
Accrual Accounting
recording in each fiscal period applicable expenses, whether paid or not, and income earned,
whether collected or not.
Accrual Basis Accounting
reporting income when it is earned and expenses when they are incurred
Accrual Basis Accounting
,3|Page
the method of accounting that recognizes revenue when it is earned and matches expenses to the
revenues they helped produce
Accrual Basis Accounting
Accounting basis in which companies record, in the periods in which the events occur,
transactions that change a company's financial statements, even if cash was not exchanged.
accrued expenses
expenses incurred in one fiscal period but not paid until a later fiscal period
accrued expenses
expenses incurred but not yet paid in cash or recorded
Cash flow from operating activities
The net amount of cash provided from operating activities.
cash flow from financing activities
The section of the statement of cash flows that reports cash flows from transactions affecting the
equity and debt of the business.
cash flow from financing activities
items related to debt, dividends, and issuing or repurchasing shares
cash flow from investing activities
The section of the statement of cash flows that reports cash flows from transactions affecting
investments in noncurrent assets.
cash flow from investing activities
involves any cash in or out of the company due to investment in or disposal of fixed assets.
Contributed surplus
Amount paid for shares in excess of their par value
Contributed surplus
money that has been invested in the firm by outside parties
Contributed surplus
A source of contributed capital that can result from certain types of equity transactions, including
the reacquisition of shares.
Straightline depreciation
, 4|Page
Allocates equal amounts of plant assets net cost to depreciation during its useful life.
Accounts Receivable
Amounts to be received in the future due to the sale of goods or services
Accounts Payable
Amounts to be paid in the future for goods or services already acquired
Cash Flow Accounting System
An accounting system entering expenses and revenues only when cash is received or paid out.
authorised share capital
Maximum number of shares that a company can issue, as specified in the firm's memorandum of
association
outstanding share capital
Issued share capital less the par value of shares that are held in the company's treasury.
inventory
the quantity of goods that a firm has on hand
inventory
a complete list of items such as property, goods in stock, or the contents of a building.
Working Capital
current assets - current liabilities
Net Working Capital
current assets minus current liabilities
current assets
cash and other assets expected to be exchanged for cash or consumed within a year
Current Liabilities
liabilities due within a short time, usually within a year
Current assets include
cash, marketable securities, accounts receivable, and inventories
Current liabilities include
CFI FMVA CORPORATE FINANCE INSTITUTE (CFI) – FINANCIAL
MODELING & VALUATION ANALYST (FMVA) FINAL CERTIFICATION
EXAM 2025 | REAL VERIFIED QUESTIONS & 100% CORRECT
ANSWERS || COMPLETE EXAM PACK || GUARANTEED PASS || BRAND
NEW & FULLY UPDATED
Income statement accounting
Accrual - revenues & costs recorded as a business earns or incurs them, not as it receives and
pays money
It includes them in the relevant period's income statement and matches them as closely as
possible
CF makes no difference whatsoever - IS where sale happens
=> How do you decide when sale happens? RECOGNIZE REV UPON DELIVERY OF
GOOD/SERVICE PERFORMED
Why are profits and cash flow not the same thing?
Accounting differences
The idea of matching over time
CFS Accounting
Only records transactions when cash is received
VS
IS records ALL revenues earned, whether in cash or accrued
Cash accounting method
record income and expenditures at the time the money changes hands
Cash accounting method
An accounting method in which income and expenditures are recorded at the time the money
changes hands.
Accrual Accounting
recording in each fiscal period applicable expenses, whether paid or not, and income earned,
whether collected or not.
Accrual Basis Accounting
reporting income when it is earned and expenses when they are incurred
Accrual Basis Accounting
,2|Page
the method of accounting that recognizes revenue when it is earned and matches expenses to the
revenues they helped produce
Accrual Basis Accounting
Accounting basis in which companies record, in the periods in which the events occur,
transactions that change a company's financial statements, even if cash was not exchanged.
accrued expenses
expenses incurred in one fiscal period but not paid until a later fiscal period
accrued expenses
expenses incurred but not yet paid in cash or recorded
Cash flow from operating activities
The net amount of cash provided from operating activities.
cash flow from financing activities
The idea of matching over time
CFS Accounting
Only records transactions when cash is received
VS
IS records ALL revenues earned, whether in cash or accrued
Cash accounting method
record income and expenditures at the time the money changes hands
Cash accounting method
An accounting method in which income and expenditures are recorded at the time the money
changes hands.
Accrual Accounting
recording in each fiscal period applicable expenses, whether paid or not, and income earned,
whether collected or not.
Accrual Basis Accounting
reporting income when it is earned and expenses when they are incurred
Accrual Basis Accounting
,3|Page
the method of accounting that recognizes revenue when it is earned and matches expenses to the
revenues they helped produce
Accrual Basis Accounting
Accounting basis in which companies record, in the periods in which the events occur,
transactions that change a company's financial statements, even if cash was not exchanged.
accrued expenses
expenses incurred in one fiscal period but not paid until a later fiscal period
accrued expenses
expenses incurred but not yet paid in cash or recorded
Cash flow from operating activities
The net amount of cash provided from operating activities.
cash flow from financing activities
The section of the statement of cash flows that reports cash flows from transactions affecting the
equity and debt of the business.
cash flow from financing activities
items related to debt, dividends, and issuing or repurchasing shares
cash flow from investing activities
The section of the statement of cash flows that reports cash flows from transactions affecting
investments in noncurrent assets.
cash flow from investing activities
involves any cash in or out of the company due to investment in or disposal of fixed assets.
Contributed surplus
Amount paid for shares in excess of their par value
Contributed surplus
money that has been invested in the firm by outside parties
Contributed surplus
A source of contributed capital that can result from certain types of equity transactions, including
the reacquisition of shares.
Straightline depreciation
, 4|Page
Allocates equal amounts of plant assets net cost to depreciation during its useful life.
Accounts Receivable
Amounts to be received in the future due to the sale of goods or services
Accounts Payable
Amounts to be paid in the future for goods or services already acquired
Cash Flow Accounting System
An accounting system entering expenses and revenues only when cash is received or paid out.
authorised share capital
Maximum number of shares that a company can issue, as specified in the firm's memorandum of
association
outstanding share capital
Issued share capital less the par value of shares that are held in the company's treasury.
inventory
the quantity of goods that a firm has on hand
inventory
a complete list of items such as property, goods in stock, or the contents of a building.
Working Capital
current assets - current liabilities
Net Working Capital
current assets minus current liabilities
current assets
cash and other assets expected to be exchanged for cash or consumed within a year
Current Liabilities
liabilities due within a short time, usually within a year
Current assets include
cash, marketable securities, accounts receivable, and inventories
Current liabilities include
