In accounting, cash flow describes cash received and paid by a business over a period.
A cash-flow statement organizes changes in cash and cash equivalents into operating, investing, and financing activities. Operating cash flow comes from the main business, such as collecting customer payments and paying suppliers. Investing cash flow includes purchases or sales of long-term assets. Financing cash flow includes borrowing, repaying debt, issuing shares, or paying dividends.
Cash flow is not the same as profit. A company can report accounting profit while waiting to collect invoices, or show positive cash flow after borrowing money. Depreciation is another reason the two measures differ: it reduces reported profit but does not itself involve a current cash payment.
Analysts often examine free cash flow, which broadly represents cash remaining after capital expenditures, though definitions can vary. Liquidity depends on timing as well as the total amount of cash generated.