Cash Flow Statement Template Excel & Google Sheets

What is Cash Flow Statement Template?

A cash flow statement template is a financial document that tracks cash movement and cash equivalents within a business, by helping businesses understand their short-term liquidity and long-term financial viability by providing a clear picture of cash inflows and outflows. It serves as a detailed summary of what happens to a company's cash during a given accounting period. By identifying the sources and uses of cash, it paints a complete picture of a business's operational health and capacity to adapt to financial challenges.

Importance of Cash Flow Statement Template

It’s more than a record of transactions—it’s a diagnostic tool that reveals the financial health of a business. While an income statement may show a profit, only a cash flow statement can confirm whether the company has the liquidity to sustain operations.

Positive cash flow indicates a business's ability to remain solvent, invest in growth, and manage unexpected expenses. Conversely, negative cash flow signals potential challenges in meeting financial obligations, even if the company appears profitable on paper.

By regularly reviewing a cash flow statement, businesses can:

• Assess liquidity and solvency to ensure they can meet short-term obligations.
• Plan for future expenses and investments with a clear understanding of available cash.
• Identify financial risks and opportunities for optimization.
• Compare financial performance with industry standards by eliminating the effects of different accounting methods.

A well-prepared cash flow statement provides insights into a company's earnings quality and its capacity to pay interest, dividends, and other obligations. It complements other financial statements, such as the balance sheet and income statement, by focusing on actual cash movement rather than non-cash transactions like depreciation or accrued expenses.

What Does Template for Cash Flow Statement Contain?

A cash flow statement template is divided into three key sections, each highlighting different aspects of cash flow:

Operating Activities

This section details the cash generated or used from the company's core business operations. In the template, it includes:

• Cash Receipts from Customers: Total cash received from customers for goods or services.
• Cash Paid for Expenses: Itemized categories of expenses, such as:
  • Inventory purchases
  • General operating and administrative expenses
  • Wage expenses
  • Interest payments
  • Income taxes
• Net Cash Flow from Operations: The difference between cash inflows and outflows from operating activities. This figure shows whether the company's day-to-day activities generate sufficient cash to sustain operations.

Investing Activities

This section highlights cash flow from buying or selling assets, reflecting the company's investment decisions. In the template, it includes:

• Cash Receipts from Sales: Cash received from activities like the sale of property, equipment, or other assets.
• Cash Paid for Investments: Transactions involving:
  • Purchases of property and equipment
  • Loans made to other entities
  • Purchase of investment securities
• Net Cash Flow from Investing Activities: The balance between cash inflows and outflows from investment-related activities. A positive figure may indicate successful asset liquidation, while a negative figure suggests ongoing investments.

Financing Activities

This section illustrates how the business raises and repays funds through financing mechanisms. In the template, it includes:

• Cash Receipts from Financing: Sources of funding such as issuing stock or borrowing money.
• Cash Paid for Financial Obligations: Includes:
  • Loan repayments
  • Repurchase of stock (treasury stock)
  • Dividend payments
• Net Cash Flow from Financing Activities: The net effect of cash inflows and outflows related to financing activities. This reflects how the business manages its financial obligations and capital structure.

How to Use Cash Flow Statement Template

1- Input Business Details

• Fill in your Business Name at the top of the template.
• Specify the reporting period by entering the year ending date under For the Year Ending.
• Add the Cash at Beginning of Year to indicate the starting balance for the cash flow statement.

2- Record Operating Activities

• Cash Receipts from Customers: Enter the total cash received from customers during the reporting period.
• Cash Paid for Expenses: Itemize expenses such as:
  • Inventory purchases
  • General operating and administrative expenses
  • Wages
  • Interest payments
  • Income taxes
• Calculate the Net Cash Flow from Operations by subtracting total expenses from total cash receipts.

3- Log Investing Activities

• Cash Receipts: Record any cash generated from activities like:
  • Sale of property and equipment.
  • Collection of principal on loans.
  • Sale of investment securities.
• Cash Paid: Include any expenses incurred, such as:
  • Purchase of property and equipment.
  • Loans made to other entities.
  • Purchase of investment securities.
• Determine the Net Cash Flow from Investing Activities by subtracting cash paid from cash receipts.

4- Detail Financing Activities

• Cash Receipts: Record any cash inflows from:
  • Issuance of stock.
  • Borrowing or loans received.
• Cash Paid: Note cash outflows, including:
  • Repurchase of stock.
  • Loan repayments.
  • Dividend payments.
• Compute the Net Cash Flow from Financing Activities by subtracting cash paid from cash receipts.

5- Calculate Net Increase in Cash

• Add up the net cash flow totals from the Operating, Investing, and Financing activities.
• Record the result as the Net Increase in Cash for the reporting period.

6- Determine Cash at End of Year

• Add the Net Increase in Cash to the Cash at Beginning of Year to calculate the Cash at End of Year. This represents the business's total cash balance at the close of the reporting period.

7- Review and Certify

• Double-check all figures for accuracy.
• Include the name and date under the certification section to confirm the statement's validity.