Fund Flow Statment 

what is fund flow statement 

Fund flow is the net of all cash inflows and outflows in and out of various financial assets. Fund flow is usually measured on a monthly or quarterly basis; the performance of an asset or fund is not taken into account, only share redemptions, or outflows, and share purchases, or inflows. Net inflows create excess cash for managers to invest, which theoretically creates demand for securities such as stocks and bonds.

Fund Flow Changes

If the fund flow changes, it often reflects a change in customer sentiment. This can be related to new product releases or improvements, recent news regarding the company or shifts in feelings on the industry as a whole. Positive fund flow changes note an upswing in inflow, a lessening of outflow or a combination of the two. In contrast, negative fund flow suggests lower inflows, higher outflows or both.

While occasional shifts may not be indicative of issues within the company, prolonged negative fund flows can be a sign there are some issues present, as this is a reflection of income not being sufficient to meet the company’s expenses. If this trend continues, it could mean the company needs to acquire a form of debt to continue operations.

Fund Flow Statements

A fund flow statement is a disclosure of the types of inflows and outflows the company has experienced. It is a forum in which to provide information regarding any fund flow activity that might be out of the ordinary, such as a higher-than-expected outflow due to an irregular expense. Further, it often categorizes the various transaction types and sources to help track any activity changes.