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cash flow Definition

cash flow

noun

the pattern of receipts and expenditures of a company, government, etc., resulting in the availability or nonavailability of cash

cash flow Finance Definition
The cash available to a business generated from its operations. A positive cash flow means that the net operating income is sufficient to cover expenses. A negative cash flow shows that expenses exceed revenues. A corporation issues a statement of cash flow with its quarterly and yearly earnings report. The statement shows where the company received its funds from and where they were spent. A popular measurement of cash flow, especially among Wall Street analysts, is free cash flow, which is cash flow left after expenses, capital expenditures, dividends, and debt service has been paid, although some companies may slightly vary what comprises free cash flow. The concept of free cash flow gained followers after the bear market that started in 2000 brought into question the quality of companiesÂ’ financial statements.
cash flow Usage Examples

Preposition: of

  • company: The amount of debt that can finance an acquisition depends on the projected cash flows of the combined company.

Converse of object

  • operate: The acquisition of PDN gives Taghmen infrastructure from which the Company can immediately generate operating cash flow.
  • generate: The Company will continue its efforts to generate positive operating cash flow throughout the balance of fiscal 2001.
  • manage: Do you manage cash flow only in a crisis?
  • monitor: Monitoring cash flow can also be useful for checking that funders are paying on time.
  • help: Lombard builds in a residual value to reduce the rentals, thus helping cash flow and making ' off-balance sheet ' funding possible.
  • provide: According to Forrest Old, executive vise president, D&B RMS, " D&B RMS provides accelerated cash flow to companies.

Adjective modifier

  • positive: The Company will continue its efforts to generate positive operating cash flow throughout the balance of fiscal 2001.
  • strong: The household business continues to make a strong operating cash flow which helps finance Dairy Crest's growth aspirations.
  • future: Neither the charge for deferred taxation nor the provision will impact upon the future cash flows of the group.
  • steady: This will form the basis for steady cash flows for a number of years.
  • stable: Large amounts of debt are more appropriate for mature companies with stable cash flows which will not require much capital for growth.
  • annual: This is because the net present worth and the annual cash flows comprising the project are of equivalent value.

Modifies a noun

  • forecast: As your business develops experience will show how long you need to extend this by to get a more accurate cash flow forecast.
  • problem: Cash is king At the same time liquidity and cash flow problems are affecting all industry sectors.
  • crisis: And frankly, I would not have seen the cash flow crisis coming, had I not had management accounts.
  • benefit: So there is also a significant cash flow benefit to being a company.
  • issue: With a line of credit, you can handle cash flow issues, keep track of expenses, and qualify for deals and discounts.
  • control: You will have to know about and use financial control systems and cash flow control mechanisms.

Noun used with modifier

  • operating: The Company will continue its efforts to generate positive operating cash flow throughout the balance of fiscal 2001.