Cash Flow provides a potential wealth of information about how the company uses its assets. Unfortunately, too many of the readers of the financial statements ignore this part of the paper and head to the long-familiar income statement and balance sheet. They probably do it because of the comparative newness of the statement of cash flows, and because of their business education, do not expose them to it. Contrary to the assumption of the majority of readers, however, the cash flow does not require sophisticated analysis of the relationship in order to assess its value. This article provides a simple set of steps for tapping into a wealth of information, the statement of cash proposals: 1) scan picture, 2) verification of the engine power of cash flows, and 3) identification of good news and bad news, and 4) to put the puzzle together. Self-test, provided to enable readers to assess their ability to perform these tasks and thus use the statement of cash to generate powerful information on financial operations of the company. "Hide
by Julie H. Hertenstein, Sharon M. McKinnon Source: Business Horizons 8 pages. Publication Date: January 15, 1997. Prod. #: BH013-PDF-ENG
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