The financing table reads like a film between the opening and closing balance sheets: it shows where the money came from (resources) and where it went (uses) during the period.
Long-term resources (what provided financing):
Long-term uses (what consumed financing):
The difference between long-term resources and uses gives the change in net working capital (FRNG). An increasing FRNG means the company generated more long-term resources than it used: a good sign for financing the operating cycle.
The second part of the table explains how the FRNG change translated into cash flow via the BFR.
The central equation in financial analysis:
Cash flow change = FRNG change − BFR change
In other words:
Numerical example: over the period, FRNG increases by +€40,000 and BFR by +€25,000.
Cash flow change = €40,000 − €25,000 = +€15,000.
The company therefore improved its cash flow by €15,000: its new long-term resources covered the increase in operating needs and left a surplus.
The financing table is a diagnostic tool that the income statement alone does not provide.
It helps answer key management questions:
This table is often prepared by the accountant at year-end, using the last two balance sheets. Accounting software like Orizen provides reliable balance sheet data (fixed assets, loans, equity, working capital) to populate this table and complements the financing table (annual, structural view) with the cash flow forecast (monthly, operational view).
Discover the Orizen answer: Orizen SME Cash Flow, modular and built for French SMEs.
Essai gratuit 14 jours What the Orizen SME Cash Flow module costsThe financing table is a retrospective and structural statement, prepared from two consecutive balance sheets: it explains how the company funded its long-term uses over a past financial year. The cash flow forecast is a forward-looking and operational tool, updated monthly, which anticipates future receipts and payments. One looks backward, the other forward.
It is not mandatory for all businesses: smaller companies are exempt. It becomes required beyond certain thresholds (notably for companies subject to consolidated accounts or exceeding size limits). However, many SMEs prepare it voluntarily, as it is an excellent financial diagnostic tool.
A negative change in net working capital means that, over the period, the company used more long-term resources than it generated: for example, large investments funded beyond CFO and new long-term loans. This is not necessarily bad (investment phase), but it reduces the safety margin for funding the operating cycle.