Profit but Negative Cash Flow

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Profit but Negative Cash Flow
Kim Mclaughlin, US
What managerial assessments may you make about an organization that has a profit and a negative cash flow in the same accounting period?

Profit But Negative Cash Flow
Ghassan Ghanem, financial Director, Kuwait
I believe that this company is having a weak treasury management as the negative cash flows highlights this fact.
Another cause could be is that the company is over investing a lot of its available funds in current as well as fixed assets.
Or, the cash outflows for debt service could be one of the reasons.
It could be a mix of the above mentioned.
Anyway, the ultimate reason could be disclosed upon analyzing the financial statements.

Profit But Negative Cash Flow
Babacar Diouf, Student (University), Senegal
I join Mr Ghassan Ghanem's idea and I hope that your operating profit is positive, otherwise you go straight in to the wall. Try to play with deadlines customer-supplier, it can help you. Conveniently, the budget management could be a solution to the problem of liquidity. He allows to anticipate the future and to correct the imperfections through a good decision-making. 26-9-2016



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