Question: Identify the quality red flags in the following portion of a cash flow statement. Revenues for 2012 declined from $456 million in 2011 to $401

Identify the quality red flags in the following portion of a cash flow statement. Revenues for 2012 declined from $456 million in 2011 to $401 million.

In Millions Net income Depreciation Change in accounts receivable, net Change in accrued expenses Change in deferred revenue Change in estimate of restructuring charge Cash flow from operating activities Cash in investing activities: Capital expenditure 2012 2011 $28.3 63.0 12.2 (5.2) 12.3 $36.5 46.0 (33.3) 12.4 (22.5) (22.0) 17.1 110.6 $58.0 $61.0

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