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Financial Intelligence for IT Professionals: What You Really Need to Know About the Numbers
book

Financial Intelligence for IT Professionals: What You Really Need to Know About the Numbers

by Karen Berman, Joe Knight, John Case
May 2008
Intermediate to advanced
320 pages
6h 24m
English
Harvard Business Review Press
Content preview from Financial Intelligence for IT Professionals: What You Really Need to Know About the Numbers

16

The Language of Cash Flow

You’d think a cash flow statement would be easy to read. Since cash is real money, there are no assumptions and estimates incorporated in the numbers. Cash coming in is a positive number, cash going out is a negative one, and net cash is simply the sum of the two. In fact, though, we find that nearly every nonfinancial manager takes a while to understand a cash flow statement. One reason is that it is always divided into categories, and the labels on the categories can be confusing. A second reason is that the positives and the negatives aren’t always clear. For example, a typical line item might say, “(increase)/decrease in accounts receivable,” followed by a positive or a negative number. Well, is it an increase ...

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Publisher Resources

ISBN: 9781422131817