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The article discusses the importance of cash flow analysis in business. The author illustrates this by presenting a simple example of a company that has increased its turnover but not its profitability. This highlights the need for careful cash flow management to avoid financial difficulties.The article also touches on the concept of credit analysis, stating that only two out of twenty candidates were able to accurately analyze the company's financial situation using basic methods such as P&L and balance sheets.The main topic of the article is cash flow, defined as the movement of money into and out of a business. The author emphasizes the importance of cash flow in making plans for sales, credit control, procurement, and human resources.The article also discusses two types of cash flow analysis: direct (used to plan and track daily financial activities) and indirect (used for long-term planning and investment analysis). The author notes that while both methods are important, they serve different purposes.Overall, the article emphasizes the crucial role of cash flow in business, highlighting its importance in making plans, managing risks, and ensuring financial stability.
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