Imagine a company such as General Electric using the direct method to prepare its cash flow statement, which essentially is like going through the company's entire bank statement.

The statement of cash flows contains sections for three sets of activities: operating, investing and financing, according to Accounting Tools. Only the operations section deals with the question ...

What Is a Cash Flow Statement (CFS)? A cash flow statement tracks the inflow and outflow of cash, providing insights into a company's financial health and operational efficiency.

We have a recommendation: reporting operating cash flows with the direct method. There is probably no better (or easier) way to serve financial statement users’ needs. Of course, our assertion begs ...

Direct vs. indirect methods of preparing a cash flow statement: The direct method focuses on going through individual transactions and compiling income and expenses.

The direct method uses gross cash receipts and gross cash payments to prepare cash flow statements. This includes money paid to suppliers, receipts from customers, interest and dividends received, ...

Explore the fundamentals of cash flow statements, including their structure, significance, and the insights they provide into a company's financial health in 2025.

Cash flow statements are used to monitor the incoming and outgoing cash and cash equivalents of a company. See a cash flow statement example.