In order to properly analyse a company there are 2 components - 1) Cash Flow 2) Operations of the company/
Mar 16 2013 11:07 AM
Professional Financial Analysts analyse a company based on its operations. So they have to understand how much money was spend (expense) to get how much revenue. Only then can they determine how good the business model is. Hence the need for accrual accounting.
Monitoring Cash is also important else the company will go bankrupt.