question archive An understanding of a firm's cash flows is an integral part of each of the six steps in financial statement analysis
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An understanding of a firm's cash flows is an integral part of each of the six steps in financial statement analysis.
They are:
1.Identify the Economic Characteristics of a Business
2.Identify the Strategy of the Firm
3.Adjust the Financial Statements for Nonrecurring, Unusual Items
4.Analyze Profitability and Risk
5.Prepare Forecasted Financial Statements
6.Value the Firm
Discuss how the statement of cash flows integrates into the above six steps of analysis.