Statement of Cash flows

Posted in Finance, Accounting and Economics Terms, Total Reads: 2280

Definition: Statement of Cash flows

Statement of Cash flows shows the flow of cash in and out of the company. The flow of cash is broken down into three activities in the statement of cash flow. The activities are:

  1. Cash flow from Operations: This is the cash inflow and outflow resulting from the company’s main operational activity.
  2. Cash Flow from Financing: This is the cash inflow and outflow due to the company’s issue of debt, shares and repayment of debt or repurchase of shares etc.
  3. Cash Flow from Investing: This is the cash inflow and outflow due to the companies investing activities such as construction of new plants, buying or selling of machines etc.

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