The Difference in Profit and Cash Flow

The three most important financial documents that a business owner should be looking at are their Balance Sheet, Income Statement, and Statement of Cash Flows. If you’re not receiving that third one from your accountant, it’s time to ask. Why is it so important? Because you can run a business at a loss – but not without cash!

The Statement of Cash Flows will show you the movement of money in your business within a specific time frame, including your operating, investing, and financing activities.

Profit is theoretical, based on how it gets reported, but cash is real. Watch my second video in a three-part series, The Difference in Profit and Cash Flow, to learn more about how your profit picture can change on paper and what your Statement of Cash Flows should include. While you’re watching, please subscribe to my YouTube Channel. And feel free to contact me with questions about your own cash flow situation or statement.

Written by Rick Arthur

Rick Arthur is a CFO whose expertise is built on Financial Intelligence and 35 years in senior financial roles. Coupled with a CEO’s perspective and the experience of building his own $20 million company, he brings a unique depth of insight into business from the top down. Wired to get to know people, Rick works hand-in-hand with business owners of intentional, growth-oriented companies, solidifying relationships as a trusted advisor and confidant to his clients. He leverages his experience to help business owners gain traction and stay laser-focused on the company’s vision, cash flow, and profitability – all while creating big picture solutions for strategic planning, growth and sustainable success.