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\"Cash flow\" is one of the most vital elements in the survival of a business. It can be positive, or negative, which is obviously a most undesirable situation. The chapter develops the concept of cash flow and then shows how the funds can be used in the business. Funds are not only generated internally; they may be externally generated, and so the chapter finishes with a discussion of externally generated funds. Aim of a cash flow statement The aim of a cash flow statement should be to assist users: · to assess the company\'s ability to generate positive cash flows in the future · to assess its ability to meet its obligations to service loans, pay dividends etc · to assess the reasons for differences between reported and related cash flows · to assess the effect on its finances of major transactions in the year. The statement therefore shows changes in cash and cash equivalents rather than working capital. More Problems here - http://www.fao.org/docrep/w4343e/w4343e04.htm