Cash Flow Analysis
Solvency and financial condition as a whole to some extent depend on incoming and outgoing cash flows. The lack of minimally adequate supply of money causes financial difficulties, and the excess money leads to the fact that the company suffers losses from inflation and drop its benefits and costs of placing additional income.
In this regard, the important role played by the cash flow analysis. Cash flow is analyzed by activity: operating, investing and financing. Cash flow statement reflects the change in the value of cash and cash equivalents for the period. It allows you to assess:
a) the structure of revenues and expenditures by activity;
b) the impact of activities on the formation of cash flows;
c) the amount of profit received a cash basis, and the difference of the amount of profit.
For a deeper study of the dynamics of solvency must make comparisons volume incoming and outgoing cash flows based on analysis of payment instruments and payment calendar company.