The Cash Flow Report in ESC shows financial changes in operating, financing and investment accounts over a period of 12 months for whatever accounts you specify. Simply put, this report is meant to show the flow of cash in and out of the business. This report gives you a good way to see exactly where your company stands at a specific point in time and the short-term viability of your company.
To use the Cash Flow Report you must first tell ESC which acounts you’d like to have on the report. To do this go to Company | System Setup | Accounting and then click Setup Cash Flow Accounts. Here is a breakdown of what should go in each column:
Cash On Hand – Balance sheet accounts such as banking accounts, checking, savings, etc.
Cash Paid Out – Income statement expense accounts such as rent, taxes, wages, etc.
Financing Activities – Balance sheet accounts such as loans, capital, owners advances, etc.
Once your accounts are setup you can run the report by going to Company | Reports | Financial Reports | Cash Flow Report. The only filter on this report is the Period Ending, which will be the last month of the 12 months on the report. When you run the report you’ll notice that it is broken down by the same columns that were in the setup screen with one extra section added, Cash Receipts. This is basically all of payments collected from customers.
The last section is your Cash Position. The cash position represents the amount of cash that you have at a specific point in time. A large cash position is often a powerful signal of financial strength, while a small cash position is a potential warning sign.