Basic Cash Flow Analysis

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Determining the ability of an entity to generate cash flow is essential whenever the repayment of a loan will extend beyond one year. Cash flow analysis measures the ability of an entity to generate sufficient cash to operate the business successfully and have excess cash to service the annual debt payment requirements. Understanding how to calculate and interpret cash flow is essential for successful financial institution employees.

This course is designed to assist financial institution employees in calculating cash flow utilizing the Universal Cash Flow Analysis method (UCA), which is used often by financial institutions to determine the flow of cash into and out of a business entity. The course will start by defining cash flow and identifying potential sources and uses of cash and then illustrating how cash flow analysis is actually the process of converting an Accrual Basis financial statement into a Cash Basis financial statement. The Rules of Cash Flow will also be covered when determining cash flow generation from changes in asset, liability and capital accounts on the balance sheet over time. The highlight of the course will be the calculation of a full UCA from the beginning to the end.