Cash Flow Report

[Mike or Penny Novack]

Charles Brescia wrote:

> Mike:
>     Thanks for the input, one of the features of GnuCash that makes it 
> so useful is this forum and all the people so willing to help.  That 
> work around would certainly work, as did the one I tried.  What I am 
> seeking here however is what I see as an improvement to the Cash Flow 
> report that wouldn't have those issues to begin with.  The P&L report 
> IS the format and functionality that I seek in the Cash Flow report.  
> Geert had suggested on another forum that I come here to make my 
> suggested improvements.  But I do appreciate all the people that come 
> here to help.
>
> Charles

But there is some possible confusion about what a "cash flow report" and 
a "P&L Report" are SUPPOSED to show. I suspect this confusion on your 
part is in not thinking of the all the possibilities. You are making an 
assumption that CASH is the only way expenses are paid and income comes 
in and that simply isn't so.

An entity for which books are being kept (person or business) has TWO 
things to consider:

1) Is income more or less than expenses? In the long run at least, going 
to have a problem if expenses are greater than income. This is what the 
P&L Report is showing.
2) Is enough cash going to be on hand at all times? That is what the 
Cash Flow Report is showing.

A) The entity might be profitable but run out of cash.
B) The entity might be unprofitable but at least in the short term have 
plenty of cash.

"A" can be a situation where liabilities are being reduced faster than 
cash is being depleted.
"B" can be a situation where liabilities are increasing faster than cash 
is increasing.

Normal is to run BOTH sorts of reports. A P&L for the period along with 
Balance Sheets for the start and end of the period AND a Cash Flow 
report for the period. If you want some sort of "combined report" 
showing all these things then you use the DATA from those reports 
(export and manipulate with the editor of your choice). That is easier 
than asking the accounting package itself to be able to produce ALL the 
various formats  that different sorts of entity might require for their 
"combined report". To give just one example, a non-profit would 
want/need to show changes in "restricted funds" but that isn't a concept 
that often applies to individuals or for profit businesses (but it CAN 
under certain circumstances).

Michael D Novack