- cash flow
- the flow of internal funds generated within the business as a result of receipts from debtors, payments to creditors, drawings and cash sales. Glossary of Business Terms————The cash receipts and payments of a business. This differs from net income after taxes in that non-cash expenses are not included in a cash flow statement. If more cash comes in than goes out, there is a positive cash flow, while more outgoing cash causes a negative cash flow. The CENTER ONLINE Futures Glossary————A finance and accounting term used to describe the net amount of cash generated by a firm's operations. In traditional and over-simplified usage, cash flow is defined as the sum of net income after tax plus all noncash expenses such as depreciation. More modern and sophisticated usage defines cash flow to include the net difference between all cash outflows and cash inflows. American Banker Glossary————In investments, cash flow represents earnings before depreciation, amortization, and non-cash charges. Sometimes called cash earnings. cash flow from operations (called funds from operations by real estate and other investment trusts) is important because it indicates the ability to pay dividends. Bloomberg Financial Dictionary
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1. [uncountable] FINANCE the amounts of money coming into and going out of a company, and the timing of these:• the lack of cash flow that results from customers not paying bills on time
• The business is suffering severe cash flow problems.
• He will have to keep to a business plan with strict month-by-month cash flow projections.
ˌnegative ˈcash flow [uncountable] FINANCEa situation where more money is going out of a business from its commercial activities than there is coming in:• Vacancy rates of 25% or more indicate a negative cash flow on the property, meaning the owner must rely on other sources of cash to meet interest payments and other expenses.
2. [countable, uncountable] ACCOUNTING profit made by a business in a particular period of time, measured in different ways by different businesses:• Time Warner defines cash flow as earnings before interest payments, taxes and depreciation.
• Volvo needs to raise production to 500,000 units to generate the cash flow (= to produce it ) required for expensive new model development programmes.
• The company announced an increase in its after-tax cash flow.
ˌfree ˈcash flow ACCOUNTING[uncountable] profit from a company's operating activities, less capital (= money spent on machinery, buildings etc) and taxation:• The company generated £200 million of free cashflow this year, so it could make another acquisition soon.
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Cash flow is the sum of pre-tax profits and depreciation allowances and is a key figure in a company's financial statement. The term is also used to describe the stream of funds received by a bond holder from the periodic receipt of interest payments.* * *
cash flow UK US (also cashflow) noun [U] ACCOUNTING, FINANCE► the movement of money into and out of a company's accounts, used as a measure of how much money the company spends and receives and how much profit it makes over a particular period of time: good/healthy/strong cashflow »It is a well-run company with strong cashflow.
improve/maintain/maximise cash flow »Bartering can help you generate sales and improve cash flow and profits.
»a cashflow problem/crisis
Financial and business terms. 2012.
