Definition
The cash flow statement tracks actual cash moving in and out of a company, divided into three sections: operating (core business), investing (capex, acquisitions), and financing (debt, equity, dividends). It reveals cash generation ability beyond accounting profits.
Formula
Net Change in Cash = Operating CF + Investing CF + Financing CF
Example
Operating CF: +$50M, Investing CF: -$20M (capex), Financing CF: -$15M (dividends, debt paydown). Net cash increase: $15M.
FAQ
What is Cash Flow Statement?
A financial statement showing cash movements from operations, investing, and financing.
How do you calculate Cash Flow Statement?
A common formula for Cash Flow Statement is: Net Change in Cash = Operating CF + Investing CF + Financing CF
Why is Cash Flow Statement important?
Cash Flow Statement helps investors evaluate financial statements and make more informed decisions.