Difference between Fund flow and Cash flow:

☛Fund flow is based on working capital. Cash flow is based on only one element of working capital that is cash.

☛ Fund flows tells about the various sources from where the funds are generated. Cash flow starts with the opening balance of cash and closes with the closing balance of cash.

☛ Fund flow is useful for understanding long term financial strategy. Cash flow is useful for understanding short term strategies that affects liquidity of the business.

Changes in current assets and current liabilities are shown through the schedule of changes in working capital.