Company reports

Cash Flow Statement

The financial statement that follows the actual money coming into and going out of a company over a period.

Why does it matter?

Profit and cash are not the same, and this statement shows where the cash really came from and where it went.

How do I read it?

It has three parts: cash from the business itself (operating), cash spent on or received from investments, and cash received from or paid to lenders and shareholders. Free cash flow on StockLab comes from it.

Example

A company reports $10 million of net income, but $4 million of its sales haven't been paid yet, so cash from the business is about $6 million. After spending $8 million on new machines, its cash actually fell by $2 million.