Question: E17.7. Red Flags in the Cash Flow Statement (Medium) Identify the quality red flags for 2009 in the following portion of a cash flow statement.

E17.7. Red Flags in the Cash Flow Statement (Medium) Identify the quality red flags for 2009 in the following portion of a cash flow statement. Revenues for 2009 declined from $456 million in 2008 to 5401 million. In Millions 2009 2008 Net income $35.5 $28.3 Depreciation 46.0 63.0 Change in accounts receivable, net (33.3) 12.2 Change in accrued expenses 12.4 (5.2) Change in deferred revenue (22.5) 12.3 Change in estimate of restructuring charge (22.00 Cash flow from operating activities 17.1 110.6 Cash in investing activities: Capital expenditure $61.0 $58.0 Applications

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