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Cash & Profit - Coggle Diagram
Cash & Profit
Cash Flow Statement
Out of Operations Activities
(income generating part of the business)
Out of Financing Activities
Raising capital
Paying investors
Out of Investing Activities
Buying & Selling assets
Formal, required reporting measure
Negative Cashflow but Profitability
Accounts Payable Delay
"Hidden" Cash
Eg. purchasing equipment shows full amount on cashflow statement but income statement only shows depreciation
Inaccurate Selling Price
Loan Payments
Cash Budgets
Used to manage business cash
Advantages
Awareness of available cash
Understand utilisation of cash
See negative cash spending patterns
Disadvantages
Amounts used are best guesses
Manipulating amounts can lead to fraud
Outside influences not accommodated