A cash flow accounting statement is a report of cash flows, both in and out of any business account or individual’s account. The aim of a cash flow accounting statement is to analyze the potential to generate cash flows, and evaluation of monetary transactions of an account. It is the key accounting report that is prepared annually. Cash flow in a business can be in either direction: cash flowing in to a business or cash flowing out of a business. The statement is supposed to portray that accordingly.
Sample Cash Flow Accounting Statement:
The statement is in four parts: firstly, cash flows relating to operations, secondly, cash flow from investing activities, thirdly, cash flow from financing activities and lastly, net increase or decrease of cash.
Cash flow statement of ABC business for the year ended 31st of December 2011
NET CASH FLOW FROM OPERATING ACTIVITIES $
CASH FLOW FROM OPERATING ACTIVITIES
Customers’ cash receipts 80,000
Salary paid to distributors and employees (50,000)
Money generated from operations 20,000
Dividends Received* 200
Received interests 500
Paid interests (500)
Paid taxes (2,400)
Net cash flow from operating activities 24,700
CASH FLOW FROM INVESTMENTS
Additions to accessory (2000)
Replacement of accessory (7000)
Proceeds** from sale of accessory 400
Net cash flow from investments (8600)
CASH FLOW FROM FINANCIAL TRANSACTIONS
Cash received from capital contributed 3000
Cash received from loan 15000
Loan payment (5000)
Net cash flow from financial transactions 13,000
NET INCREASE/DECREASE OF MONEY 25,000
Cash at the starting of the period 2,500
Money at the end of the period 27,500
*Dividends are cash payouts to individuals who have purchased shares in the company.
**Proceeds means cash received.