Cash Investment in Operations is Not Investment in Operations

Once purged of net investment in debt assets, a financing cash flow, cash flow from investment in the cash flow statement is the cash expended to invest in operations. But it is not total investment in operations because investment can be made in non-cash transactions. Examples are:

• Investment in acquisitions paid for by issuing shares
• Assets acquired in asset exchanges
• Assets acquired by issuing debt
• Assets leased: The cash flow occurs later with lease payments