Accordingly, as a startup company owner, you have to know the ins and the outs of cash flow statements. Fear not. So what exactly is a cash flow statement? You can find a simple cash flow statement example on any basic accountancy website. We threw one together so that you can check out how it all works:. As is the case with all of the financial forms that the Startup Series covers, the accuracy of your cash flow statement depends upon your astute bookkeeping.
A cash flow statement is a financial report that describes the sources of a company's cash and how that cash was spent over a specified time period. It does not include non-cash items such as depreciation. This makes it useful for determining the short-term viability of a company, particularly its ability to pay bills. Because the management of cash flow is so crucial for businesses and small businesses in particular, most analysts recommend that an entrepreneur study a cash flow statement at least every quarter.
Cash flow is the money that is moving flowing in and out of your business in a month. Although it does sometimes seem that cash flow only goes one way—out of the business—it does flow both ways. Several forms of coronavirus relief are available to small businesses affected by the pandemic:. The loan is primarily an incentive for keeping or re-hiring employees.