oboloo Glossary

Cash Flow Statement Activities

oboloo Glossary

Cash Flow Statement Activities

Cash flow statement activities provide organizations with insight into the financial health of their business. This type of statement is used to determine the incoming and outgoing sources of cash over a set period of time, usually a year or a quarter. Businesses typically analyze their cash flows to understand how efficiently they are managing their finances, what trends affect their liquidity, and whether they need additional funds. There are three main activities that are tracked in a typical cash flow statement: operating activities, investing activities, and financing activities. Operating activities show how much cash your business generates from its daily operations, while investing activities show how much capital was used in investments such as stocks and bonds. Financing activities indicate how much money was acquired through loans, equity investments, and other borrowing. Understanding your organization’s cash flow statement activities can provide invaluable insight into the workings of your business.