A cash flow statement helps to evaluate performance because:-
It determines the ability of the company and each division to generate cash flows fromoperations.
“Cash is king” for some analysts.
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We could see how is the cash for investments being allocated.-
How is the company financing their new capital expenditures, stocks or debt.A breakdown by division is very useful because:-
An analysis of the performance of each division is possible.-
Cash generated by division is a better metric of operational efficiency.