Relationship of cash flow to leverage and ability to internally meet all cash requirements is evaluated. The volatility of cash flow over time and the impact of seasonality on cash flow is also assessed.

The specific issues include :

• Adequacy of cash flow to maintain the operating capacity of the business: working capital levels, replacement of fixed assets.
• Contribution from cash flow towards expansion: major capital spending projects, acquisitions.
• Discretionary spending included in cash flow including advertising, exploration, research & development expenditure.
• Volatility of cash flow over time.
• Relationship between cash flow and total debt.
• Restrictions on cash flow : limits on repatriation, potential taxation effects, access to dividends from subsidiaries.
• Liquidity levels and fluctuations: seasonality, sensitivities.
• Working capital management and measurements.