The statement of cash flows could always be just a list of various cash flow items all randomly one after each other. However, it wouldn’t be of much use that way. Hence, as a business in involved in 3 types of activities – operating its business, investing into assets and financing its activities –, those are the groups also the cash flows are presented for.
Now to give a little bit more insight to those 3 groups let’s start with operating cash flows. Those are the cash flows generated through normal course of business – selling, buying and producing. What sometimes is also included within this group, are the interest paid. It’s simply because financing is usually received for keeping or supporting main operations so it’s more suitable to have them as a part of operating activities. However, note that the financing itself, i.e. loans, are never part of operating.
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As we have mentioned already, every now and then it’s a must to send your excess cash to your bank. It’s this “cash in transit” – not yet arrived to bank, but already sent from your part.
In a way it’s kind of like planning for stock count. There are teams, instructions and the time. While there isn’t much else to add, it’s just this one little thing to watch out for – temptation that money creates.
The obvious answer to such a question is of course “all”. And as you might guess, it’s obviously the right answer, but there’s a little more to it. Whilst counting all is a “must”, surely you can see that for practical reasons the smaller the amount, the better.