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Cash flow statement

The cash flow statement in QuickBooks helps you better manage your cash flow.

  • Overview

  • About cash flow statements

  • Cash flow statement template


    Manage your cash flow

    Many small businesses strive to get a better handle on money coming in and going out. This is where cash flow comes into play. QuickBooks tracks and organizes all your accounting data, and can generate your cash flow statement—so you always know how much money you have coming in to cover your bills.


    Make better business decisions

    Cash is essential to keeping your business financially stable and successful. Quickly generate your cash flow statement with QuickBooks, and you’ll get a clear view of your cash flow for any time period.


    Set yourself up for success

    The cash flow statement—along with the balance sheet and income statement—is one of the 3 key financial statements used to assess your company’s financial position. QuickBooks can generate all the reports you need to keep your business running smoothly. Even look back in time and predict your future cash flow.

Frequently asked questions

What does cash flow mean?

Cash flow is the amount of money flowing in and out of a business over a certain period. In other words, it refers to the increase or the decrease in the amount of cash held by a business.

Positive cash flow indicates that a business is liquid i.e. it can pay the bills, repay its debts and reinvest in the business.

Negative cash flow indicates a mismatch between expenditure and income. Ongoing negative cash flow can signal ineffective credit management, wastage or long-term loss, all of which can lead to business failure if left unchecked.

What is a cash flow statement and why is it important?

A cash flow statement shows where a business’ cash is being generated (cash inflows) and where it is being spent (cash outflows), over a specific period of time. This provides an overview of how much cash is available to a business over a specific period, and how that cash flow changes over time.

Cash flow statements are important for analysing the liquidity of a business. Many businesses fail due to poor cash flow management, which is why regularly reviewing your cash position is so important. A cash flow statement can provide the insights needed to make necessary business adjustments – such as cutting expenses or seeking additional funding – to sustain positive cash flow.

How do you fill out a cash flow statement?

To create and fill out a direct cash flow statement, you’ll need to:

  1. Gather data and receipts of your income and expenses, as detailed above in ‘What to include in a cash flow statement’.
  2. Use a self-created spreadsheet or a template to organise your data into a cash flow statement. Your entries will show cash incoming and outgoings each month for the reporting period of your cash flow statement.
  3. Record the totals of your cash incomings and outgoings over your reporting period.
  4. Total your total money going out and subtract from your total money going in. You’ll be left with an accurate view of your company’s cash flow for the period you’ve set.

Why is cash flow important?

Simply put, cash flow is important because it indicates that a business is running smoothly. It allows a business to pay the bills, meet customer demand and invest back in the business.

Maintaining positive cash flow also means a business can keep operations running regardless of fluctuations in revenue or profit.

What’s the difference between a cash flow statement and a cash flow projection?

A cash flow statement provides insights into how your cash flow has changed over time, while a cash flow projection (also known as a cash flow forecast) estimates your cash incomings and outgoings for future months.

A cash flow projection template or cash flow forecast template records estimations of your cash flow for the future, while a cash flow statement template shows how cash flow has increased or decreased over a defined period.

Both reports are useful for understanding your cash position and maintaining positive cash flow over time.

While Excel templates can be useful for a new business, they eventually become too time-consuming to use when you’re dealing with a lot more business activity. As your business grows, you might consider switching to accounting software to help you handle most of the work and give you back more time to focus on what’s important.

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