Close & reporting
Cash flow statements
A statement of cash flows built from a UK company's actual accrual books, showing where cash came from and went across operating, investing and financing activity, rather than relying on a bank balance that only tells you today's number and nothing about the trend behind it.
Management report
Illustrative client · August 2026
GBP
| Line | Aug | Jul | |
|---|---|---|---|
| Revenue | 142,380 | 131,904 | +10,476 |
| Cost of sales | (51,260) | (48,115) | (3,145) |
| Gross profit | 91,120 | 83,789 | +7,331 |
| Payroll | (46,300) | (45,900) | (400) |
| SoftwareNoted | (6,480) | (5,490) | (990) |
| Rent | (8,000) | (8,000) | 0 |
| Other operating | (9,215) | (9,870) | +655 |
| Net income | 21,125 | 14,529 | +6,596 |
Reviewer's note
Software is up on last month after two seats were added mid-month. Revenue includes one milestone invoice that will not repeat next month.
Illustrative. An example of the document, not a client's figures.
A bank balance tells you one number, not the story
Knowing what is in the account today does not tell you whether cash is trending up or down, or why. A statement of cash flows built from your accrual books, alongside a rolling cash forecast, shows both the direction and the cause behind it.
What's involved
- A monthly statement of cash flows, using the direct or indirect method depending on what your reader needs
- Reconciliation of net income to operating cash flow
- Cash position tracked against a rolling weekly or monthly forecast
- Notes on the largest swings in operating, investing or financing activity that month
- A flag on any forecast month where the cash position is expected to tighten
Direct or indirect method
Most monthly reporting for UK companies uses the indirect method, starting from net income and adjusting for non-cash items and working capital movements. We use the direct method when a lender or investor specifically asks for that format instead of the more common one, and we agree which method suits your reader before the first report goes out.
Why this sits alongside the rest of your close
Cash flow reporting draws on the same closed books used for your management accounts and KPI dashboard, so the numbers reconcile across every report you receive that month rather than telling three slightly different stories about the same business to three different readers.
Delivery
Prepared and reviewed by a senior reviewer, and delivered from the Xero, QuickBooks Online or Sage file that already holds your cash and bank records, on the same schedule as the rest of your monthly close.
Questions
Frequently asked questions: Cash flow statements
Isn't our bank balance enough to know our cash position?
A bank balance tells you today's number, not why it moved or where it is heading; a cash flow statement and forecast show both.
Does the statement flag a tightening cash position?
Yes. Any forecast month where cash is expected to tighten is flagged separately in the commentary.
How far ahead does the cash forecast look?
Clients often run a rolling weekly or monthly forecast, extended further ahead where the business is managing towards a specific cash runway.
Why might profit be positive while cash flow is negative in the same month?
Profit includes non-cash items like depreciation and accrued revenue not yet collected, while cash flow reflects money actually moving. A profitable month with slow-paying customers or a large VAT payment can still show negative cash flow, and we explain the gap rather than leaving it as a confusing mismatch.
Does the cash flow statement separate operating, investing and financing activity?
Yes, cash from day-to-day trading is shown separately from cash used for asset purchases or investment, and from cash tied to loans, equity or dividends, since blending all three into one number hides whether the core business is actually generating or consuming cash.
Isn't my bank balance enough to know my cash position?
A bank balance tells you today's number, not why it moved or where it is heading; a cash flow statement and forecast show both.
Direct or indirect method, which do you use?
Most monthly reporting uses the indirect method starting from net income; we use the direct method when a lender or investor specifically asks for it.
What software works with cash flow statements?
Cash flow statements runs inside Google Sheets or Excel, whichever you already use. If you are not yet set up in either, we can configure a file in your name so you keep ownership of it once the engagement is under way.
How do we get started with cash flow statements?
Getting started with cash flow statements begins with a short review of your current records and software access. Once that is done we confirm scope and timing in writing, and ongoing work begins on the schedule agreed with you.
Related services
- Close & reportingBudget vs. actualActual results lined up against the budget every month, with the gap explained in plain language rather than left for you to work out on your own.
- Close & reportingManagement reportsMonthly profit and loss, balance sheet and cash flow packaged with a plain-English narrative so the numbers explain themselves before anyone has to ask a question.
Industries
- Startups and VC-backed companiesBookkeeping and reporting for early-stage, venture-backed companies watching burn, runway and investor reporting closely.
- Construction and job costingBookkeeping for contractors and builders who need cost and profitability tracked by job, not just by month.
- HospitalityBookkeeping for hotels, short-term rentals and hospitality operators reconciling booking platform payouts and occupancy-driven revenue.
Next step
Talk to the team that would run your books
A short call covers your setup, your software and what a first month would look like. You get a written scope and price after it.