12. The Cash Flow Statement

The cash flow statement is typcally the 3rd of the 3 financial statements found in an Annual Report. This video provides an overview.

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• compounding
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• stocks
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• flow
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• Michael
• Fischer
• savingandinvestin
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[mischeviousclc]

Hi there, i d like to know what a more defined definition of the difference between the income statement and the cash flow, i mean if we take a truck which u have cited as an example, u d find out that probably it wasnt bought on full cash, but u have mentioned that it would reflect as a whole lump sum on the cash flow and not on the income statement,if u may plz elaborate further,geting to my point i still happen to mixed up on the latter so if u may pliz enlighten me a little. Thank u

[savingandinvesting]

@mischeviousclc Cash flow statement measures changes in cash each year - starts fresh each year. If truck was bought partly cash, then cash used would show as change on cash flow statement (rest of truck would be debt on balance sheet). As income statement does not capture financing activities (like dividends, new debt, selling shares) and shows charge for use/depreciation on truck - cash flow statement very important to monitor cash in company. See book for more - hope that helps though.

[bobmarshall101]

thanks for making cash flow make sense.

[mischeviousclc]

well u see i dont get the whole purpose of the cash flow with its exppenses and the incomestatement with its expenses...do we roll the balance from the cash flow to the succeding year or do we then have to start a new cash flow with new figure for that succeding year? thank u

[smokenfly514]

can anyone recommend a book for putting together and reading financial statements?

[afendiamir]

thanks for putting in layman terms...more informative than those other video's. thanks!

[86rishabh]

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[allan9874]

i got a business studies test tomorro =)

[xtrafire21]

Video has really helped. Very gud explaination