1, revenue receivable is not received.
According to the Accounting Standards for Business Enterprises-Revenue, listed companies recognize revenue according to the following principles: (1) The main risks and rewards of commodity ownership are transferred to the buyer; (2) The company has neither retained the right to continue management, which is usually associated with ownership, nor exercised control over the sold goods; (3) The economic benefits related to the transaction can flow into the company; (4) Relevant income and costs can be measured reliably. As long as the above standards are met, listed companies can confirm their income and costs, and then "calculate" their "net profit".
But in fact, businesses that meet the above conditions often appear in the form of "accounts receivable" or "notes receivable", which does not bring corresponding cash inflows to the company.
2. Cost in cash outflow.
Even if the sales revenue can be recovered in cash, if the company's sales costs and taxes also flow out in cash, the final balance may lead to "cash flow per share" being lower than "earnings per share".
3. Raise less money and pay more principal and interest.
The influence of fund-raising activities on the "deviation" between net profit and cash flow is not as obvious as that of operating activities and investment activities. Because whether it is to absorb equity capital or borrow money to issue bonds, cash will soon flow into listed companies, and the time interval here will not be long. The repayment of interest and principal can basically synchronize the recognition of expenses with the outflow of cash.
The imbalance of cash flow under fund-raising activities is more manifested in the excessive inflow of fund-raising activities in the current period and less cash used to repay principal and interest, which makes the "net cash inflow" of listed companies increase.