Cash Flow Statement/ Analysis

Definition

Similar to a budget. It projects when cash will be received and when cash is needed to pay debts. A business must have enough cash on hand to pay for its day-to-day operations.

What Does it Do?

The Cash Flow Statement/ Analysis allows investors to understand how a company's operations are running, where its money is coming from, and how it is being spent.

Where does it come from?

A cash flow statement comes from reports of the cash generated and used during a specific time interval.

What does it show?

The cash flow statement shows how much cash comes in and goes out of the company over the quarter or the year.

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What sections are in the cash flow statement?

It includes three sections: operating cash flow, investing cash flow, and financing cash flow.