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Analysis of cash flow statement

What do you mean by the term Analysis of cash flow statement?

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The cash flow statement shows the net outflows and inflows of cash during the year. The cash flow statement of the company is not appealing. It has not been able to generate sufficient cash in the current period.

Most of the cash has been used in purchasing new equipments and vehicles for the company.

Secondly cash has been used to meet interest and dividend obligations. Since the company was in cash shortage it should have not taken the decision to distribute the dividend.

Operating expenses of the company are high due to which all the cash has been used to pay off expenses.

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