Cash flow is a term used to describe the flow of cash receipts and payments in a business operation as well as the revenue that increases the value of a cash account over time for a specified period based on the performance of a business. Understanding Cash Flow is especially important to investors who have income-producing properties. While many investors are interested in profit and loss statements, balance sheets and cash flow statements are critical to fully understanding the attributes of an investment. Investors may have varying needs. For example, to one investor, long range profitability may be the most important attribute to consider in an investment, while another investor may require an investment to produce sufficient income annually. In addition, a Cash Flow analysis may demonstrate varying income during the year or accelerated income over the life of the investment. Cash reserves should be considered part of the total investment in a property since it represents money that is not available to invest otherwise. Property investments often require cash reserves to sustain operations during the time an investor owns the property. A new property may take time to attract the occupancy level anticipated in the long term. A Cash Flow statement is created by adjusting the numbers reported on the balance sheet and income. Accumulated depreciation is added back, since it is created as a non-cash expense and accounts payable are subtracted as deferred receipts of cash. Money obtained through borrowing would also be added as cash. For example, from a loan that is made available for operations. Steady Cash Flow is essential to the survival of the company and prevention of insolvency.