hi all can anybody plz tell me what is the diferebnce between Cash flow and fund flow. Reds Sunil
From India, Mumbai
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From India, Mumbai
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Cash Flow
Cash flow is the summary statement that shows:
- Money receipts by the organization
- Money payments by the organization
- If the difference of total receipts is greater than total payments, then cash flow is positive.
- If the difference of total receipts is less than total payments, then cash flow is negative.
Funds Flow
The funds flow statement shows how the sources of funds equal the uses of funds during the period covered by the statement. Funds obtained from:
- Sales of goods
- Sales of properties
- Sale of stock
- Borrowings
- Others
are related to their use for:
- Purchase of fixed assets
- Payment of debts
- Distribution of funds
- Other purchases
Regards,
Leo Lingham
From India, Mumbai
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270Cash flow is the summary statement that shows:
- Money receipts by the organization
- Money payments by the organization
- If the difference of total receipts is greater than total payments, then cash flow is positive.
- If the difference of total receipts is less than total payments, then cash flow is negative.
Funds Flow
The funds flow statement shows how the sources of funds equal the uses of funds during the period covered by the statement. Funds obtained from:
- Sales of goods
- Sales of properties
- Sale of stock
- Borrowings
- Others
are related to their use for:
- Purchase of fixed assets
- Payment of debts
- Distribution of funds
- Other purchases
Regards,
Leo Lingham
From India, Mumbai
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Hi Sunil,
I think I am too late to answer your question. Please find my answer:
Cash Flow:
It measures the actual inflow and outflow of cash. It does not consider any accruals.
When drafting a cash flow, you start with the opening balance of cash and summarize the receipts and payments, and the resultant figure is the closing balance of cash.
Funds Flow:
It measures the working capital of the company, which is the excess of current assets over current liabilities.
Consider depreciation: Though an entry is made in the P&L account, cash does not go out (it is actually a book entry). Therefore, when preparing a funds flow statement, you have to add this amount to profit.
Similarly, when you sell an asset, you have to account for the profit or loss on the sale of the asset. You take into account the book value of the asset and find the difference from the sale value to estimate your profit. Therefore, if you had accounted for a loss, it is again a book entry only and has to be added back to profits.
In the cash flow, you would have considered the actual cash that had come in from the sale of the asset.
Moreover, when working out funds flow, you start from the opening balance of accumulated profits and end with the closing balance.
Another way of working the funds flow through the balance sheet is by finding the difference between the current assets and current liabilities.
Please get back if you require more clarity.
From India,
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I think I am too late to answer your question. Please find my answer:
Cash Flow:
It measures the actual inflow and outflow of cash. It does not consider any accruals.
When drafting a cash flow, you start with the opening balance of cash and summarize the receipts and payments, and the resultant figure is the closing balance of cash.
Funds Flow:
It measures the working capital of the company, which is the excess of current assets over current liabilities.
Consider depreciation: Though an entry is made in the P&L account, cash does not go out (it is actually a book entry). Therefore, when preparing a funds flow statement, you have to add this amount to profit.
Similarly, when you sell an asset, you have to account for the profit or loss on the sale of the asset. You take into account the book value of the asset and find the difference from the sale value to estimate your profit. Therefore, if you had accounted for a loss, it is again a book entry only and has to be added back to profits.
In the cash flow, you would have considered the actual cash that had come in from the sale of the asset.
Moreover, when working out funds flow, you start from the opening balance of accumulated profits and end with the closing balance.
Another way of working the funds flow through the balance sheet is by finding the difference between the current assets and current liabilities.
Please get back if you require more clarity.
From India,
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The CFS allows investors to understand how a company's operations are running, where its money is coming from, and how it is being spent.
FFS shows the fund for the future activities of the company.
From India, Mumbai
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FFS shows the fund for the future activities of the company.
From India, Mumbai
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Hi, all the friends. I am facing a problem. Actually, I am working in a construction company in Delhi. There is a large transaction of cash and bank, and my boss has told me that you will give me monthly project-wise cash flow and fund flow. So, how can I pass the right way of flow? Please give formats of cash flow and fund flow as soon as possible. Thank you.
From India, Delhi
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From India, Delhi
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Hi Nirmal,
I can provide you with very good notes on Finance. Similarly, could I also receive notes, not just information, on SAP FICO? I am looking forward to it.
Regards,
Nirmal
From India, Madras
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I can provide you with very good notes on Finance. Similarly, could I also receive notes, not just information, on SAP FICO? I am looking forward to it.
Regards,
Nirmal
From India, Madras
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Cash Flow
Cash flow is the summary statement that shows:
- money receipts and payments by the organization.
- If the difference between total receipts is greater than the total payments, it means the cash flow of the organization is profitable. :-)
- If the difference between total receipts is less than the total payments, it means the cash flow of the organization is trending downwards. :(
Funds Flow
The Funds Flow Statement shows how the sources of funds equal the uses of funds during the period covered by the statement. This means that in a stipulated period, funds collected from sales of goods, stock, debt, etc., are related to their use for:
- purchase of fixed assets,
- payment of debts,
- distribution of funds,
- other purchases.
SANDI
From India, Indore
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Cash flow is the summary statement that shows:
- money receipts and payments by the organization.
- If the difference between total receipts is greater than the total payments, it means the cash flow of the organization is profitable. :-)
- If the difference between total receipts is less than the total payments, it means the cash flow of the organization is trending downwards. :(
Funds Flow
The Funds Flow Statement shows how the sources of funds equal the uses of funds during the period covered by the statement. This means that in a stipulated period, funds collected from sales of goods, stock, debt, etc., are related to their use for:
- purchase of fixed assets,
- payment of debts,
- distribution of funds,
- other purchases.
SANDI
From India, Indore
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