It must be stressed that cash flow analysis is a projection of your cash flow and relies on payments coming in and being paid as they fall due. This can vary widely depending on your type of business and your customers, and how diligent you are in paying your bills on time.
Other factors include ensuring credits are fully allocated in both your debtors and creditors, and moving purchases from Received to Finish in a timely fashion. Of course, all these things should be done to ensure your accounts are giving you a true reflection of your financial state at all times.
With that disclaimer in mind, you will find that cash flow analysis is an extremely useful tool in helping you manage your business's cash requirements.
Further information: