Download our free cash flow statement example PDF and Excel spreadsheet.
Whether you’re thinking about hiring, making a major purchase, or you simply want to keep your business healthy, regularly reviewing your cash flow statement (along with your balance sheet and income statement/profit and loss) can help you make spending decisions with confidence.
Your cash flow statement shows how cash moved in and out of your business during a specific period of time, like last month, last quarter, or last year.
A cash flow statement is formatted into three main sections: operations, investing, and financing. These sections help you see how cash changes affect each area of your business.
For each line of the cash flow statement, the formula is:
Cash Flow = Cash Received - Cash Paid Out
An example of cash received would be your sales, and cash paid out would include your expenses.
To learn more about what a cash flow statement is and how to read it, check out this article on our LivePlan blog: The Cash Flow Statement: What It Is and How to Use It.
When you do regular cash flow analysis, you review your statement against your cash flow forecast, as well as against the previous period—last month or last year, for example.
Monitoring your cash flow regularly is a fundamental part of managing your business. This type of financial review will help guide your future projections, and help you make smarter spending decisions.
Even if your profit and loss (also called P&L or income statement) shows that your company is profitable, you could still have cash flow problems and be at risk.
Why? Because cash isn't the same as profits.
If you need more help creating your cash flow statement and building a cash flow forecast, take a look at LivePlan. It’s a simple tool for planning, forecasting, and tracking your business performance.
With LivePlan, you can easily create complete financials without any prior business knowledge. LivePlan walks you step-by-step through the process—no formulas or messy spreadsheets, and no accounting knowledge required. Plus, you'll get our world-class phone and email support to help you along the way.
Using spreadsheets to manage your financials is painful—it often requires building complex pivot tables or toggling between multiple documents. But with LivePlan, all the calculations are done for you using built-in formulas.
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