What is the difference between accounting net profit and operating cash flow?

Accounting net profit.

and operating cash flow.

The difference between:

1. The measurement basis of the two is different. The financial profit of a business is based on accrual accounting.

It is calculated on the basis of the basis, that is, both income and expenditure should consider their benefit periods, and the income or expenditure will be attributed to different periods for different periods, and then the profit for the period will be obtained. Cash flow, on the other hand, is calculated on a cash basis, i.e., regardless of the accounting period in which the income and expenditure belong, as long as the cash actually received or expended in that period is regarded as the cash flow of the period.

2. The content contained in the two is different. Chinese Accounting Standards for Business Enterprises.

and the accounting system stipulates that the net profit of an enterprise generally includes operating profit.

Net investment income, subsidy income and non-operating income and expenditure. While the content of cash flow is mainly profit, it also contains other components. In addition to the purchase and sale of goods, investment or recovery of investment, it also includes the provision or acceptance of services, the purchase and construction of fixed assets, the borrowing of loans from banks or the repayment of debts, etc.

3. The economic implications of the two explanations are different. The amount of financial profit reflects to a large extent the economic benefits achieved in the process of production and operation of the enterprise, and indicates the final operating results of the enterprise in each accounting period. The amount of cash flow can clearly indicate whether the business turnover of the enterprise is smooth, whether the capital is in short supply, the size of the ability to pay debts, and whether the scale of operation is excessively expanded, whether the foreign investment is appropriate, and the capital operation.

whether it is effective, etc., so as to provide very useful information for investors, creditors, and corporate managers.

The calculation of net accounting profit is the net amount of total income minus total expenditure less income tax expense, which is included on the accrual basis.

Operating cash flow is the cash flow of operating activities actually received in the current period, and the cash flow of actual payment of operating activities, whether they are filled in or not, whether they are current income and expenses, as long as they see money, they are recorded on the cash basis.

The basis of the two is different!

Net profit is the result of enterprise operation and reflects the profitability of the enterprise;

Cash flow is the amount of capital flowing in and out of the enterprise in the course of operation, reflecting the ability of the enterprise to use funds.

Profits supported by cash flow are more real. Cash flow data can also reflect whether a company's profits are false.

That's all I have to think about, FYI.

The difference between operating cash flow and net operating cash flow: net operating cash flow only reflects the economic business related to operation, while net cash flow reflects the sum of operation, investment and financing.

Net cash flow from operating activities.

Net increase in cash and cash equivalents - Net cash flow from financing activities - Net cash flow from investing activities. Preparation of cash flow statements.

The difficulty lies in determining the net cash flow generated by operating activities, because financing activities and investment activities are relatively rare in the business of the enterprise, and the financial data is easy to obtain, so the cash flow items of these two activities are easy to fill in, and it is easy to ensure that the net cash flow results of these two activities are correct, so that the net cash flow generated by operating activities calculated according to the formula is also easy to ensure that it is correct.

Net cash flow from operating activities.

If the net cash flow of investment activities is negative, and the net cash flow of financing activities is positive, it can be judged that the enterprise is in a period of rapid development. At this time, the product quickly occupied the market, and the sales showed a rapid upward trend, which was manifested in the return of a large amount of monetary funds in business activities, and at the same time in order to expand market share.

Companies still need to make significant additional investments and rely solely on cash flow from operating activities.

The net amount may not be sufficient to meet the required investment and must be supplemented by the necessary external funding.

Net cash flow.

It's not the same as cash flow. Cash flow refers to the cash inflow, cash outflow and total amount generated by an enterprise on the basis of cash through certain economic activities (including operating activities, investment activities, financing activities and non-recurring items) in a certain accounting period. That is, the inflow and outflow of cash and cash equivalents in a certain period.

Net cash flow can be divided into operating and investment. The net operating cash flow of the group refers to the cash inflow of the existing enterprise under normal operating conditions. A description of the outflow activity.

It is generally used for the overall valuation of enterprise assets, and some are also used for intangible assets.

Global assessment and individual assessment.

1. Matters that affect profits do not necessarily occur at the same time as cash inflows and outflows: some revenues increase profits but do not incur cash inflows. For example, if a company's operating income in the current period is more than 800 million yuan, but the new accounts receivable in the current period is more than 700 million yuan, this increase in revenue and profit but no cash inflow is one of the reasons for the difference between the two.

2. Some costs and expenses reduce profits but are not accompanied by cash outflows. For example, the depreciation of fixed assets and the amortization of intangible assets only require that the acquisition cost of these assets be reasonably apportioned during the benefit period of their use according to the accrual basis and the principle of proportionality, and no cash is required.

3. Due to the need for cash flow classification: the net profit aggregate reflects the financial results of the company's three major activities: operation, investment and financing, while the cash flow statement needs to reflect the cash flow of operation, investment and financing activities respectively.

1. Net income = net profit, indicating the operating results generated by an enterprise in a fiscal year, net profit (EBIT) = total income - total cost.

2. Net cash flow indicates the cash flow of an enterprise in an accounting year, net cash flow = total cash inflow - total cash outflow.

3. Cash flow, only involves the occurrence of cash or banking business related economic transactions, however, the profit of the enterprise, is composed of the income and expenditure of the enterprise, in this calculation process, not necessarily all the income has been actually recovered, or the people next to the shirt may not necessarily have many expenses have been actually spent, that is, there is no actual cash flow, so, under normal circumstances, can only be the net cash flow of the enterprise is less than the net profit of the enterprise.

Summary. Hello, the net operating cash flow is greater than the net profit, indicating that the company is in good operating condition, the current stock price is low, and there is a lot of room for growth!

Hello, the net operating cash flow is greater than the net profit, indicating that the company is in good operating condition, the current stock price is low, and there is a lot of room for growth!

Generally, the net cash flow is greater than the net profit, indicating that the business operation is relatively normal. The net cash flow can be quietly not greater than the net profit, which contains a great risk, which is easy to cause the capital chain to break and affect the development. The company's main business model is franchising, and non-cash factors such as amortization and depreciation of assets will lead to differences; The company pays attention to high-quality and refined operations, continues to increase payment collection, and maintains a good level of operational cash flow.

Reasons: 1. Because accounting follows the accrual system, many of the profit and loss accounts in the income statement are not realized (or reflected) through the income and expenditure of monetary funds, so the net profit is definitely not equal to the net increase or decrease of cash.

2. The cash flow statement calculates the net amount of the actual increase or decrease in monetary funds in a certain accounting period.

To sum up, net profit and cash flow amount are completely different concepts and completely different calculation methods, so they are usually inconsistent.

What is the relationship between net cash flow from operating activities and net profit? It is the cash inflow in operating activities minus the cash outflow, simply put, the money you receive minus the money you spend, the difference is the net inflow, the cash flow statement describes the inflow and outflow of cash, that is to say, the net amount is the real excess money in our business activities.

The income statement represents the accrual basis of accounting. It means that we have sold the goods, and the other party has not paid for the goods, but the contract between the two parties has been signed. We have already shipped to the other party, and at this time we need to recognize the relevant revenue and profit.

It is possible that the profit in the income statement has not been received, and the real money can be verified at this time.

The cash content of net profit is the ratio of the amount of cash flow incurred by operating activities divided by net profit. If it is greater than 1, it means that the gold content is relatively high, and if it is less than 1, it means that the gold content is relatively low. This ratio, also known as the net profit to cash ratio, is a very important indicator, and many times financial report fraud can be used to determine whether the company has money or not.