Abstract
Purpose: This study aims at highlighting the importance of the information derived from the cash
flow statement in predicting the financial failure of the commercial banks in the Kingdom of Saudi Arabia.
The study sample consists of Saudi Commercial Banks. The questionnaire has been developed to collect
the necessary data to measure the variables of the study. In total, 120 questionnaires have been distributed
of which 110 were responded to and found suitable for analysis.
Results: The results of the investigation confirm the importance of the information derived from the
cash flow statement related to the evaluation of liquidity and quality or sorts of profits in the prediction of the
financial failure of the commercial banks. In addition, this study finds that there is a considerable agreement
in the views of the surveyed sample regarding the adequacy and efficiency of the information in prediction
of the financial failure of the commercial banks.
Recommendations: The findings of the study draw attention to the necessity of focusing on the
cash flow statement in addition to the other financial statements due to the fact that these statements
include important information that enables the users to predict the financial failure. In addition, the study
shows that it is possible to use these statements for making decisions and evaluating the financial and
investment opportunities.