Cash Flow Statement

Financial document detailing the exchange of cash between a business and the outside world. The flow is categorized as:

  • flow "in" from Operations
    (cash the company made by selling goods and services)
  • flow "in" from Financing
    (cash the company raised by selling stocks and bonds)
  • flow "out" to Investing
    (cash the company spent investing in its future growth)

Each of these flows can actually flow both ways. Investors like to see that the company can cover its spending with cash from operations, without having to turn to financing.

The cash flow statement also has to reconcile the net effect of these flows with the difference in its cash holdings at the beginning and end dates of the reporting period.

See the main article for a sample cash flow statement.

home  |  glossary  |  calculator  |  about us  |  books