What's the difference between cash flow operations and income statement operations?
submitted by lisa

Joe

Cash flow is the actual movement of cash in and out of a business. It includes your main operations, like receipts from customers and payments to suppliers and employees.

Income statement operations are reflected in net income or loss, which includes non-cash things like depreciation and accrued revenues.

Essentially, cash flow operations focus on cash liquidity, while income statement operations consider future profitability because they include accrued numbers.

Fran Hansen

Cash flow operations show the cash that a company really receives and spends during its main business activities.

Income statement operations are a little different because they include things that don't involve actual cash, like depreciation or bad debt expenses. So, cash flow is about cash movement, and the income statement is about profit.

You may have $25,000 in accounts receivable due to be paid in the next month, and you want to include that figure somewhere. Income statement operations would include that.

Svenhard

Cash flow operations are the actual cash going in and out of the business. That'd be money from sales or bills you've paid.

Income statement operations tell you how much money the business earned or lost, including payments that don't explicitly involve cash. It includes things like writing off equipment value, which is a loss, but doesn't necessarily involve the movement of cash.

Slim Goodbody

Cash is cash, but income is also intangibles. Some things you'd see with income statment operations that you wouldn't see with cash flow operations:

Depreciation
Amortization
Accrued Revenues and Expenses
Bad Debt Expense
Deferred Revenue - You're going to get it, but don't have it now.
Impairment Losses - When your equipment gets damaged.

I'm sure there are other examples, but those are a few to get you started.