Symptom
The distortion lives in the P&L — net profit margin is the primary executive reporting metric while the cash flow coverage ratio requires combining Stripe payout data with the accounts payable schedule and is almost never in the standard board report.
Cause
Inventory front-loading accounts receivable timing settlement lags and fixed obligation due dates all produce operating cash inflows that trail obligations — four structural mechanisms that intensify with growth and compound under liquidity stress.
Impact
At zero point seven two coverage and twenty-eight thousand monthly shortfall with one hundred and fifty thousand in reserves the business has five point four months of runway before reserves are exhausted — with the P&L still reporting sixteen percent margins throughout.