11/10/2025
WOOP WOOP! You made it to the last day in my "things your bookkeeper WISHES small businesses knew about their financials" series...
Tbh, I think the Statement of Cash Flows is the most confusing financial statement for most small businesses, but it's absolutely crucial to keeping your business afloat.
According to SCORE, 82% of small businesses fail because of cash flow problems. OOOF! ๐ฌ
Your cash flow statement does exactly what it sounds like: it shows how cash "flows" through your small business.
โ Cash from operations (your day-to-day biz)
โ Cash from investing (buying/selling assets)
โ Cash from financing (loans, owner draws, contributions)
Even if your P&L shows that you're making a profit, your cash flow statement can show whether you *actually* have enough cash for everything you need to spend on (like payroll + bills!).
Sound confusing? My clients get unlimited emails to me, because I'm on a mission to help as many small businesses as possible understand their numbers!