Driving Effective Financial Strategy for CEOs and CFOs | Compounding your Impact x Influence through Strategic Finance Courses, Trainings & Talks | Founder and President, Financiario.Com
Profit is not Cash Flow ---------------------- 💎 LinkedIn restricts post length to 3,000 characters, so **Join The Finance Gem** 💎 (it’s free) and get my unabbreviated Linkedin post content and other finance gems delivered weekly straight to your Inbox >> (**L𝗶𝗻𝗸s 𝗶𝗻 my Linkedin profile & below in 𝗰𝗼𝗺𝗺𝗲𝗻𝘁𝘀)** ------------------------- 🎯 If you liked this post, you would love my video course **The Cash Flow Masterclass,** where I cover these and many other critical cash flow topics in great detail ----------------------- Regardless whether you’re a professional, an executive or a business owner, cash flow mastery will transform your future. >> There are 3 types of business activities and each of them can absorb or release cash into a business. ♦️ operating activities ♦️ investing activities ♦️ financing activities >> Here’s what you need to know about ♦️ cash flow from operating activities: 🎯 represents the primary sources and uses of cash in day-to-day business operations 🎯 it's presented first in the statement of cash flows 🎯 it can be calculated using either the direct or the indirect methods, but the result is always the same >> Key sources of cash in this section include: ♦️ Cash collected from customers for sales in the current period (revenues) ♦️ Cash collected from customers for sales made in prior periods (accounts receivable) ♦️ Cash collected as interest and dividends (interest/dividend income) ♦️ Cash collected as tax refunds (tax refunds) >> Key uses of cash in this section include: ♦️ Cash payments to suppliers/vendors in the current period (COGS/OPEX) + owing from prior periods (accounts payable) ♦️ Cash payments to employees in the current period (OPEX - wages) + owing from prior periods (wages payable) ♦️ Cash payments made for interest in the current period (interest expense) + owing from prior periods (interest payable) ♦️ Cash payments made for income taxes in the current period (tax expense) + owing from prior periods (taxes payable) >> How to Master your Operating Cash Flow: ☑️ Monitor, analyze and forecast your cash conversion cycles ☑️ Develop and maintain a robust cash flow forecasting model ☑️ Perform regular sensitivity analyses to evaluate the impact of changes in key variables What would you add? ______________________________________________________ ➕ Follow me for more finance, business, and cash flow insights. 🔔 Ring the bell at the top right of my profile so you don't miss out on new posts. #entrepreneur #finance #cashflow
Cash!: "Cash is a fact, profit an opinion"! 😎
Great post. Sure thing. Profit is not a cash flow. Profit is rolled in the cash receipts themselves, it is not singled out amount that need separate invoicing. Perhaps a cash receipt from customer for goods bought is a factor of purchase cost, overhead, variable costs and desired margin. Thanks for sharing this Oana
Another reason FP&A cannot stop at just forecasting P&Ls. It has to cover all statements. Thanks Oana!
Thank you so much
Thank you Oana, wonderful
Nice post !!
Thanks Oana !
Driving Effective Financial Strategy for CEOs and CFOs | Compounding your Impact x Influence through Strategic Finance Courses, Trainings & Talks | Founder and President, Financiario.Com
1yhttps://www.oanalabes.com/courses/cashflow