Cash flow

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Accounting - cash management - financial reporting.


The movement of cash in or out of a business, a project or a financial instrument in a particular period under review.

The cash flow for a given period may differ from the profit or loss for the same period because of:

  1. Items in cash flow which are not part of profit or loss. For example capital expenditure or the collection of trade debtors arising and recognised in prior periods; and
  2. Items in profit or loss which are not cash flows, such as depreciation, amortisation, or making accruals.

It's important to distinguish our cash flow from our cash balance.

Cash flow is a movement in the amount of our cash.

It either increases - or decreases - our cash balance.

Our cash balance is the amount of cash we hold.

Cash flow is sometimes written cashflow.

See also

Other resource

Students: Cash in, The Treasurer