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What are Indicators Based on Cash Flow
Indicators based on cash flow are among ratios and their role is to capture the warning signs of potential credit problems and assess internal financial potential of the company.

Indicators based on cash flow are among ratios and are also know as cash flow indicators or indicators using cash flow. The role of cash flow analysis is to capture the warning signs of potential credit problems and assess internal financial potential of the company. The indicators are usually based on other ratios (such as profitability, liquidity), in which the accounting profit is usually replaced by cash flow. Financial flow from operating activities is usually measured with certain elements of the income statement or balance sheet.

The basic formula for calculating the cash flow is:

Cash flow = profit + depreciation +/- change in long-term reserves

The most frequently used indicators based on cash flow:

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Last update: 23.08.2016

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