CFO.com (01/22/14) David M. Katz
Corporate America’s level of cash flow suggests that the U.S. economy is still stuck in a recession. Revenue has fallen a median of more than 9% over the 12-month period ending in September, according to a recent quarterly review of cash flow trends by the Georgia Tech Financial Analysis Lab. The decline in median sales, along with decreases in areas such as capital spending and outlays for inventory “are similar to developments observed during the recession,” the report says. Revenue growth must expand if the economy is to improve and companies are to increase hiring, but they still are reluctant to spend, notes Charles Mulford, director of the lab and an accounting professor at Georgia Tech.