What’s the Difference Between Cash Flow and Profit? In previous blogs, we’ve covered the Income Statement and Cash Flow Statement. It’s important for investors, especially those new to financial statements, to understand the differences between Cash Flow and Profit. While they are often used interchangeably, Cash Flow and profit are not the same. In a… Continue reading
Working Capital is the cash needed for a business to carry on operating and covering short-term obligations. Understanding a business’s Working Capital needs is a great way to measure the near-term liquidity and risk factors of a business to carry on day-to-day activities. It can provide investors insights into the operating efficiency of the business… Continue reading
Cash Flow is the movement (flow) of money that comes in and out of a business. Money that moves out (Spent) is known as Cash Outflows while money that moves in (Received) is known as Cash Inflows. Cash Flow is different to earnings as it is a real snapshot of when a business receives money… Continue reading
Accounting Standards are guidelines and rules governing how corporations prepare and present their financial statements. These Standards ensure companies use the appropriate procedures and principles in their accounting methods. Without Accounting Standards, companies could report, present, and adopt any accounting method they choose which would always showcase their financial position and operations in the best… Continue reading
An Annual Report is a mandatory corporate document that outlines, breaks down and reflects the company’s financial position and operational activities for the previous financial year. It gives shareholders an insight into the management actions and how the company is performing in line with the strategy set out by the leadership team. What is the… Continue reading
All three financial statements are connected although they appear and are represented independently. Investors need to understand how to link the income statement, balance sheet and cash flow statement together. By understanding the transactions and how one change flows through to other statements investors can gain greater insights into a company’s business model. With this… Continue reading
A Cash Flow Statement is the last of the three financial statements that records all the incoming and outgoing cash of the business. It connects the income statement and the balance sheet by showing how cash has flowed throughout the business. The Cash Flow Statement unlike the other statements is a record of the actual… Continue reading
A Balance Sheet is one of the fundamental financial statements of a company, also known as the “Statement of Financial Position”. It is comparable to the “Net Worth” of the business and represents a snapshot of the assets, liabilities, and shareholder’s equity at a particular point in time. The Balance Sheet is the most critical… Continue reading
An Income Statement is a financial report that shows how much revenue and expenses a company accrues over a particular period. Also known as the Profit and Loss Statement, the Income Statement is one of the 3 key financial statements. This Statement gives insights into a company’s performance, operations, profitability and management efficiency. TABLE OF… Continue reading
To build a portfolio, you need to have a detailed plan that outlines the types of asset classes and returns necessary to achieve your goals. Once you have developed a strategy, you can allocate your capital across a diversified portfolio and then manage it. Building an investment portfolio has two stages – portfolio construction and… Continue reading
