Module VI· Cash Flow Statement MechanicsBasic
Question
What are the rules of cash for CFS construction?
Answer
Increases in assets usually use cash; decreases in assets provide cash. Increases in liabilities usually provide cash; decreases in liabilities use cash. Non-cash expenses are added back. Investing outflows such as capex reduce cash. Financing inflows such as debt issuance increase cash, while repayments and dividends reduce cash.