Comparison of a cash flow statement and a cash flow waterfall

Grouping of cash flows
The cash flow statement presents information in three key categories: Cash flow from operations; cash flow from investing; and cash flow from financing, which are standalone from one another.

Seniority of cash flow items
The cash flow statement does not order cash flows in order of seniority, thereby making it less efficient when analysing a project’s debt repayment ability. The cash flow waterfall clearly shows the amount of cash flow at each level as described in the term sheet.

Investors or Financiers?
The cash flow statement provides information that can be readily analysed from an external investor’s perspective, whereas the cash flow waterfall provides information that can be easily analysed by the banks.