Operating Cash Flow
Operating Cash Flow (OC), also known as Cash Flow from Operations (CFFO), shows all Income Statement and Balance Sheet changes that affect a company's flow of cash from its "daily," normal, or operational business activities. It monitors Balance Sheet and Income Statement items that reflect a change in a company's cash position.
For example, a significant increase in a company's receivables, (could indicate difficulties in collecting invoices) or in its inventories, (could indicate product returns) are disclosed within a company's Cash Flow from Operations Report. Cash Flow from Operations is a "conservative" financial measure. It resides within the Operating Cash Flow section of a company's CASH FLOW STATEMENT that is filed quarterly with the SEC. There are three required accounting sub-sections in a Financial Statement; "The Income Statement," "The Balance Sheet," and "The Cash Flow Statement." Since the Cash Flow Statement reconciles the balance sheet and the income statement it is arguably the most important of all.