Understanding How Cash Flow Differs from Profitability

Your small business may be making a profit, but are you keeping an eye on your cash flow? The cash flow budget is an essential type of financial forecasting. The following articles offers some insights on the difference between profit and cash flow, and provide tips on cash flow forecasting.

The Cash Flow Learning Curve

How could this hair salon owner be making a profit and still not have any money? Why it’s crucial to keep track of where the money and debt are located.

See the New York Times blog post Help! I’m not a numbers person (part 2).

More Than Just Accrual Accounting

Cash flow statements have three sections—operations (cash generation), investing (cash outflows), and financing (debt and equity transactions)—all of which may reveal how a company pays the bills while still earning money.

Read the Forbes article Analyze the cash flow the easy way.

The Importance of Creating a Budget

Inc. offers tips for creating an effective cash flow budget. The reporter stresses the importance of reviewing, updating, and sharing the budget regularly, and using it to meet financial goals.

Read the Inc. article How can I create a reliable cash flow budget?

Upcoming Programs on Cash Flow Statements

  • Fundamentals of Financial Accounting
  • Corporate Finance


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