the concept behind the cash flow statements?
In: Economics
If company runs out of cash, it is bankrupt. It is literally like the HP bar in videogames.
Cash flow statement tracks how much cash flows into an out of the company, and for what reasons. Operations Cash Flow is the responsibility of COO, Financial Cash Flow — of CFO, etc.
It is kinda similar to the bank statement for your checking account.
In contrast, Profit and Loss statement is more to compute taxabale profit, or give shareholders an idea of how profitable are the “normal operations” of the company, as opposed to one-time investments or divestments.
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