February 2019
Beginner
3520 pages
50h 49m
English
There are three big reasons for understanding the cash flow statement.
First, it will help you see what is going on now, where the business is headed, and what senior management’s priorities are likely to be. You need to know not just whether the overall cash position is healthy but specifically where the cash is coming from. Is much of it coming from regular business operations, rather than from lenders or investors? That’s a good thing—it means the business itself is generating cash. Is investing cash flow a sizable negative number? If it isn’t, that may mean the company isn’t investing in its future. And what about financing cash flow? If investment money is coming in, that may ...
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