Cash flow is basically the net amount of cash equivalents and cash that are moving in and out of your business. If there is a positive cash flow, that signifies that the company is a liquid asset, re-investing in the business, enabling to settle debts, paying expenses, returning money to shareholders, and providing a buffer against future financial challenges.
On the contrary, a negative cash flow highlights that the assets of the company are decreasing. Additionally, the net cash flow is determined from net income including accounts receivable and other items due to which payment has not yet been received. Required for assessing the quality of the company’s income and determining its liquidity, a statement of cash flow determines if the company is solvent or not.
A cash flow statement, abbreviated as CFS, is one of the main financial statements out of three (the other two being the income statement and balance sheet) to gauge a business’s financial strength. When the cash flow is strong, it signifies that a company is in a good position to expand the business. Also, the business has an open door for all opportunities and can also invest in new projects. These financial statements are helpful to show the constant inflow and outflow of cash.
Business entities must maintain a sufficient balance of cash at all times as this practice enables them to meet different types of needs and requirements of the business. However, the cash outflow and inflow must be maintained properly. The ultimate reason to prepare the statement of cash flow is to ascertain the changes in the cash position of the business entity. By enabling the financial policies and evaluating the cash position, a statement of cash flow helps in managing the business.
Our passion to help people succeed inspired us to come up with these high quality customizable cash flow statements documents.
Here’s what else you can expect from our legal and business services,
We can help you to:
It’s time to bring your business to another level. Start to optimize and streamline your business today. Get all the professional-grade business templates you need to plan, start, organize, manage, finance, and grow your business; one click away in the below links!
For our ONLINE legal and business services, please follow this instruction:
P.S. Sometimes all that’s needed is a form, document or tip that can solve problems or issues that repeat in your life or business. To save you from unnecessary legal costs by hiring lawyer(s), here are customizable smart templates/forms that you can use as often as you need; flexible enough to allow for changes without leaving you exposed. Click the following link, FREE CUSTOMISABLE LEGAL TEMPLATES to search for the desired template, download it and embark on your great legal adventure – and don’t forget to bring the bug spray. For each template, we have numerous different customizable documents.
Go to the “Order Now” page and make a request.
We look forward to addressing your concerns and earning your trust and confidence in us!
🇰🇪 Kenya’s E-Lawyers and Business Specialists 🇰🇪
Join our mailing list to receive the latest news and updates from our team.