The Cash Flow Statement explains how the business’s cash position changed over the selected period.
A business can report profit and still have weak cash flow. It can also receive cash in a period without that cash being new revenue. This report exists to explain those differences.
Cash is not revenue
Revenue describes earned or posted business performance according to the accounting model. Cash describes money movement.
An Invoice can create revenue and Accounts Receivable before the customer pays. When payment clears, cash increases and receivables decrease without recognizing the same revenue again.
Cash is not a payment attempt
Where a metric claims to represent settled cash, Lynka uses valid cleared settlement activity. Pending or failed payment attempts should not be counted as if the money is already available.
What to investigate when cash looks wrong
Compare:
- customer Payments and their settlement state
- cash receipts and disbursements
- bank activity and reconciliation
- the selected period
- reversals or refunds
- whether excluded test or fixture data is leaking into one side
Cash Flow and bank reconciliation
The Cash Flow Statement explains movement in the accounting cash picture. Bank reconciliation checks that the books and the bank statement agree for the relevant account.
Use both. A Cash Flow Statement cannot tell you that a specific bank statement line is still unmatched.
Cash Flow and Profit & Loss
A simple example:
- You issue and post an Invoice in June.
- Revenue appears in June according to the accounting posting.
- The customer pays in July.
- Cash increases in July.
The P&L and Cash Flow reports can therefore show different timing while both remain correct.
Use cash reporting for operating decisions
Owners should look beyond the ending cash balance. Ask:
- Is cash from customers arriving slower than expected?
- Are supplier payments clustered in a way that creates pressure?
- Is profitable growth increasing receivables faster than collections?
- Are refunds or large one-off outflows affecting the period?
Those questions connect Accounting to real operating decisions. Last modified on September 7, 2026
