Explanation:

The cash flow statement reveals a lot about a business that you can't immediately find on the income statement or balance sheet. For example, many companies are profitable on the income statement, even though the cash flow statement reveals they're actually burning through cash in every quarter or year.Calculating a company's net change in cash is as simple as finding three (sometimes four) entries on a cash flow statement.

The net change in cash is calculated with the following formula:

Net cash provided by operating activities +

Net cash used in investing activities +

Net cash used in financing activities +

Effect of exchange rates on cash and cash equivalents (if the company does business in other currencies).