Cash Flow Statement
A statement reconciling the change in a company's cash balance over a period, split into operating, investing and financing activities.
Formula
Change in Cash = Operating Cash Flow + Investing Cash Flow + Financing Cash Flow
Unit
₹ crore
In depth
Cash is the one line in the accounts that is hardest to manufacture, which is why analysts read this statement first when they suspect trouble. The three-way split is the point: profit funded by operations is sustainable, profit accompanied by negative operating cash flow and rising borrowings is not. A persistent gap between reported net profit and operating cash flow usually means receivables or inventory are swelling, which is the classic early signature of aggressive revenue recognition. The statement does not tell you whether a business is good, only whether the money the profit and loss claims is actually arriving.
Worked example
Net profit ₹90 crore but operating cash flow of only ₹20 crore, with receivables up ₹70 crore. The profit is real in accounting terms and has not yet been collected — a gap worth explaining before it is worth investing in.
Illustrative figures, chosen so the arithmetic is easy to follow. Not a live price and not a valuation of any company.
Educational reference only
This entry explains what “Cash Flow Statement” means. It is not investment advice and not a recommendation to buy or sell any security. Any numbers above are illustrative, not live prices, and nothing here predicts price direction or rates a stock. Consider your own circumstances and consult a SEBI-registered investment adviser before acting.