Urgent query

From cash flow we stands how much cash we recd from our debtors and profit means what company earned during the financial year after subtracting all expenses related to business direct or indirect..

Abhinandan ur talking about ''Cash inflow & Profit" or ''Cash flow chart & P&L a/c''......?

Hey dear 

Cash Flow means Cash Inflow Less cash outflow- Actual Cash movement in the business......

& Profit means Income Less Expenses - it is accural basis so Profit realised in the business.

Hi,

I wanted to know that refundable security deposited by a Pvt COMPANY with government for a contract has been forfeited for not complying with the terms. Is it to be treated as a business loss??

If by agreement two other parties had contributed 60% of the security amount to the company to share profit or loss of the company and now the company forfeits that money.. What wld be its tax treatment??

Thanx for ur suggestions...

cash flow means cash inflow less cash out flow 

 profit means profit earned by  the company duing the f/y  whether  actually rereiced or accrual 

TO ca in service

I mean cash inflow and profit.................

Dear Abi, Profit shows the performance of the company but Cash flow shows how well the funds are managed in the Company. Even though profit is Important Cash flow is much more important because cash flow affects the business from top to bottom. In the Context of Income tax we see Cash flow in comparing Rent free Accomodation and HRA mostly. But You see cash flow is the most important factor in choosing options in Tax planning rather than profit we earn from it.

Profit is an opinion & cash flow is the reality