Funds Flow Statement

Formal

A financial report which describes the periodic performance of a business, not in terms of its profitability, but of the performance in pure cash terms. It therefore describes the liquidity of the business and can highlight different trends from those that are obvious from an isolated review of the Earnings statement.

Real-world Example

A company's funds flow statement shows that most of its cash inflow this year came from new borrowing rather than operating profit - highlighting how the business's cash position actually moved, not just its year-end totals.