Example cash flow statement
A cash flow statement is divided into four sections. We'll explain each section in detail, but let's start with the overall layout.
Get more on each of the four sections below.
Cash flow from operations
Show the cash coming in from sales. And show the cash that you spent running the business. Total these amounts to show the overall effect of operations on cash flow.
Cash flow from investments
Show cash spent on big items like real estate and equipment. Also show money received from selling those same types of things. Total these amounts to show the overall effect of investments on cash flow (it will often be a negative number).
Cash flow from financing
Show cash received from lenders and investors, and amounts that were paid back to them. Also show cash put in, or taken out, by the owner. Total these amounts to figure out the overall effect of financing on cash flow.
Net cash movement
Bring everything together to show the overall changes in your cash position.
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What a cash flow statements tells you
A cash flow statement shows how much money you have to spend, and where that money comes from. And if there’s not much cash left, it can tell you where it went.
To do this, the cash flow statement combines information from your:
- profit and loss – including sales revenue and business expenses.
- balance sheet – including owner’s drawings and repayment of loan principal (your P&L only shows interest paid).
As you can see from our example cash flow statement, these reports also provide a handy summary of taxes and interest paid, which can be useful numbers to have on hand.