Explain why it is possible for a company to report a net profit after tax and have less cash in the bank at the end of the year than at the beginning year.?

A company can report a net profit after tax while having less cash in the bank due to several factors, such as non-cash accounting items like depreciation and amortization, which reduce taxable income but do not affect cash flow. Additionally, if the company has significant accounts receivable, it may recognize revenue that hasn’t yet been collected in cash. Furthermore, high capital expenditures or investments in inventory can also consume cash, leading to a decrease in cash reserves despite reported profitability.