Cash Flow Accounting Has Blind Spots

With all the accounting scandals in the news, it is tempting to ask: Why cant companies report on a simple cash-flow basis? This is sometimes referred to as shoebox accounting, as money is put in the shoebox as it is received, and taken out as it is spent. If you have more money in the shoebox at the end of the year, then you are ahead of the game for that year.

In this column, I apply the shoebox method to the property-casualty insurance industry in 2001, and come to two clear conclusions:

Want to continue reading?
Become a Free
PropertyCasualty360 Digital Reader.


  • All news coverage, best practices, and in-depth analysis.
  • Educational webcasts, resources from industry leaders, and informative newsletters.
  • Other award-winning websites including and

Already have an account?


© 2023 ALM Global, LLC, All Rights Reserved. Request academic re-use from All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.



Join PropertyCasualty360

Don’t miss crucial news and insights you need to make informed decisions for your P&C insurance business. Join now!

  • Unlimited access to - your roadmap to thriving in a disrupted environment
  • Access to other award-winning ALM websites including, and
  • Exclusive discounts on PropertyCasualty360, National Underwriter, Claims and ALM events

Already have an account? Sign In Now
Join PropertyCasualty360

Copyright © 2023 ALM Global, LLC. All Rights Reserved.