Arnold identifies flaw in use of operating cash flow when compared with operating profits as a measure of organizational performance
The findings are derived from Arnold’s analysis on a case study basis of archival data for Vickers 1910-24 and Pergamon Press 1964-80. They suggest that a modification of the conventional operating cash flow measure would provide a more useful measure that might improve performance analysis more generally by avoiding an artificial separation between commercial operations and capital investment decisions.
“Vickers shipbuilding 1910-24 and the representation of industrial expansion and decline” and “‘Not the exact science some of us thought’? Profit measurement at Pergamon Press 1964-80 and some alternative perspectives on a time of growth, crisis and recovery”, were both presented at the World Congress of Accounting Historians at Newcastle University 17-19 July 2012.