How to Prepare a Cash Flow Statement. The statement of cash flows is generally prepared using two different methods: the direct method and the indirect method. Both result in the same financial statement showing how financial transacations affected would have affected the bank account of the company. The Cash Flow Statement, or Statement of Cash Flows, summarizes a company's inflow and outflow of cash, meaning where a business's money came from (cash receipts) and where it went (cash paid).By "cash" we mean both physical currency and money in a checking account. The cash flow statement is a standard financial statement used along with the balance sheet and income statement. And the cash flow statement, which shows us what the business has been doing with its cash - provides vital information. So yes, cash really is king - in the business world and even in accounting. The Cash Flow Statement Format. Okay, so before anything else, here's the format of the cash flow statement itself. See further below for explanations