A statement of cash flows is a financial statement showing how changes in balance sheet accounts and income affect cash & cash equivalents.
The cash flow statement has 3 parts: operating, investing, and financing activities. There can also be a disclosure of non-cash activities.
Cash flows from financing activities arise from the borrowing, repaying, or raising of money.
Cash flow from investing results from activities related to the purchase or sale of assets or investments made by the company.
The operating cash flows refers to all cash flows that have to do with the actual operations of the business, such as selling products.
Having positive and large cash flow is a good sign for any business, though does not by itself mean the business will be successful.
The statement of cash flows is a useful tool in identifying organizational liquidity, but has limitations when it comes to non-cash reporting.