What is the importance of the statement of cash flow in the financial management of an organization

What is the importance of the statement of cash flow in the financial management of an organization

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What is the importance of the statement of cash flow in the financial management of an organization? A cash flow statement is important in an organization so that it can adequately assess so that it can adequately assess the incoming and outgoing flow of cash and other revenues. Nonprofit organizations are required to produce financial statements based on the accrual method of accounting. How is this different from the cash basis of accounting? Why is accrual accounting important?(AC) “Revenue recognition: Revenue is recognized when both of the following conditions are met: a. Revenue is earned. b. Revenue is realized or realizable. Revenue is earned when products are delivered or services are provided. Realized means cash is received. Realizable means it is reasonable to expect that cash will be received in the future.
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This note was uploaded on 03/08/2010 for the course HSM HSM 260 taught by Professor Unsure during the Spring '10 term at University of Phoenix.

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What is the importance of the statement of cash flow in the financial management of an organization

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