What s the meaning of cash flow?

how can it be determinant in a company? what s difference between cash flow, capital, turnover and revenue?

1 Answer(s)


Simply put, Cash Revenue - Cash Expenses = Cash Flow

Cash flow is the ultimate determinant of how profitable a company is. It signifies what is the final cash a company makes after paying of all its expenses (including capital expenses like machinery etc).

Turnover and revenue mean the same - it is the money you make when a customer pays you for your products. Revenue could be cash revenue or non-cash revenue. Non-cash revenue is typically cash you have received in another time period but accounting for it as revenue in this time period.

The term "Capital" is typically refers to "Share Capital. This is the amount of money that a company has raised by issuing shares to investors.