[Foundation-l] Posting of Mid-year financial statements

Thomas Dalton thomas.dalton at gmail.com
Fri Feb 22 19:56:38 UTC 2008

>  Quick dumb question: Can you explain how depreciation of furniture and
>  equipment positively impacts the organizations cash position? Related,
>  perhaps, to an overestimate on the impact of depreciation as an expense?

I was a little confused by that. I think all the signs are the
opposite of what you would expect. It's not laid out as:

Cash at beginning of period
-Cash spent
+Cash received
=Cash at end of period

It's starting with net income and reconciling that with cash flow.
Depreciation is positive because it has a negative affect on income
but no affect on cash flow (it doesn't involve cash), so has to be
added back on to get from net income to net cash flow.

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