Cash Flows

What information does the cash flow statement provide that you cannot see in the other financial statements (income statement, balance sheet, owner’s equity)? What elements of the cash flow statement do you think are most important for company management to monitor and why? Is this different for investors? The cash flow statement reports a company’s inflow and outflow of cash. While an income statement provides the information about whether or not a company made a profit, a cash flow statement can tell you whether the company generated cash. The cash flow statement also provides information regarding investing and financing activities that do not require the consumption of cash. All of these aspects are important for a company management to monitor because they all have such a strong effect on the financial health of the company. The examination of the cash flow statement should be a high priority for potential investors; the amount of money that flows in and out of a company is something that investors might want to monitor.

Go to http://finance.yahoo.com. Enter in “AAPL” and click on the “get quote” button, and it will bring up information on Apple. On the left hand side you’ll see a section on Financials. Within that section, click on the cash flow. Review the cash flow statement for Apple. How would you summarize Apple’s cash flow position and what does this statement tell you about where the money is coming from and where it’s going? What would you suggest Apple’s do to improve its cash position and why? Apple’s net income doubled between 2011 and 2012, however, it has fallen off for the 2013 year. The depreciation has also doubled in the past year. The major issue with Apple’s cash flow is the excessive amount of liabilities and financing. Apple needs to look into their investments and make a few changes in order to improve their cash flow.
Go to http://finance.yahoo.com. Enter in “AAPL” and click on the “get quote” button, and it will bring up