BNET Business Dictionary
Business Definition for: Cash Flow Statement
- a record of a company's cash inflows and cash outflows over a specific period of time, typically a year.
Example: It reports funds on hand at the beginning of the period, funds received, funds spent, and funds remaining at the end of the period. Cash flows are divided into three categories: cash from operations; cash-investment activities; and cash-financing activities. Companies with holdings in foreign currencies use a fourth classification: effects of changes in currency rates on cash.
A standard direct cash flow statement looks like this:
CRD Inc.
Statement of cash flows
For year ended December 31, 20__CASH FLOWS FROM OPERATIONS$Operating Profit82,000Adjustments to net earningsDepreciation17,000Accounts receivable(20,000)Accounts payable12,000Inventory(8,000)Other adjustments to earnings4,000Net cash flow from operations87,000 CASH FLOWS FROM INVESTMENT ACTIVITIESPurchases of marketable securities(58,000)Receipts from sales of marketable securities45,000Loans made to borrowers(16,000)Collections on loans11,000Purchases of plant and land and property assets(150,000)Receipts from sales of plant and land and property assets47,000Net cash flow from investment activities(-121,000) CASH FLOWS FROM FINANCING ACTIVITIESProceeds from short-term borrowings51,000Payments to settle short-term debts(61,000)Proceeds from issuing bonds payable100,000Proceeds from issuing capital stock80,000Dividends paid(64,000)Net cash flow from financing activities106,000Net change in cash during period72,000Cash and cash equivalents, beginning of year27,000Cash and cash equivalents, end of year99,000
Additional Resources
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- Value Based Management
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