Cash flow statement

This refers to the part of an organisation’s financial statements which forecasts receipts and expenditure over time.

The cash flow statement shows the impact of the organisation’s activities in cash (typically bank transactions) terms. By period (typically monthly) it shows the sources of cash (for example sales receipts, grants received, sale of assets) and outgoings (for example operating expenses, capital purchases, loan repayments). The statement is critical for assessing and managing the liquidity and solvency of the organisation.

The cash flow statement is a term normally found in management accounting and financial management.

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