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The Accounting Standards Board issues financial reporting standards (FRSs) for the United Kingdom. It took over the task of setting accounting standards from the Accounting Standards Committee in 1990.

The predecessor to the United Kingdom's Accounting Standards Board. The ASC issued Statements of Standard Accounting Practice (SSAPs).

A liability that results from the purchase of goods or services on open account, that is, without a signed note payable. On the cash flow analysis statement the account is used in computing change in operating payables, a component of cash cost of revenue.

The combined period-to-period increase or decrease in accounts payable and accrued expenses payable.

Amounts due from customers as a result of delivering goods or services and extending credit in the ordinary course of business. Also referred to as trade receivables.

The change in accounts receivable as carried on the company-reported indirect method statement of cash flows.

Amounts due from customers as a result of delivering goods or services and extending credit in the ordinary course of business, net of the allowance for doubtful accounts on accounts receivable, an estimate of the portion that will prove uncollectible. On the cash flow analysis statement the account is used in computing change in operating receivables, a component of cash from revenue.

The dominant basis of accounting that recognizes revenue as it is earned and expenses as they are incurred. The timing of the recognition of revenues and expenses is separated from the timing of the associated inflow and outflow of cash.

Accruals measured in terms of revenue from core operations per day. Calculated as accruals divided by revenue from core operations measured on a daily basis using a 365-day year.

See also: Accruals days

Accruals measured in terms of revenue from core operations per day. Calculated as accruals divided by revenue from core operations measured on a daily basis using a 365-day year.

See also: Accruals (in revenue days)

Accruals as a percentage of revenue from core operations. In effect, the proportion of revenue from core operations owed due to accruals as of the end of a reporting period.

The cumulative amount by which goodwill and acquisition-related intangibles have been expensed through amortization through time. Because goodwill is no longer amortized, changes in accumulated amortization will be due to amortization of other acquisition-related intangibles. On the cash flow analysis statement, changes in the account from one period to the next is used as an approximation for amortization expense on goodwill and acquisition-related intangibles. The account is used in computing capital expenditures, a component of investment to support operations, by serving as a reduction in depreciation and amortization incl. in cost of revenue and depreciation and amortization incl. in SG&A. The account is also used in computing investments in goodwill and acquisition-related intangibles, a component of investment of sustainable free cash flow.

A component of the shareholders' equity account, accumulated other comprehensive income, that derives from foreign currency translation adjustments.

A component of the shareholders' equity account, accumulated other comprehensive income, that derives from derivatives-related transactions and cash-flow hedges.

A component of the shareholders' equity account, accumulated other comprehensive income, that derives from unrealized gains and losses on marketable securities categorized as available for sale.

A component of the shareholders' equity account, accumulated other comprehensive income, that derives from underfunded pensions where the projected benefit obligation exceeds the fair value of pension assets.

A component of the shareholders' equity account, accumulated other comprehensive income, that cannot be classified as related to foreign currency translation, marketable securities, derivatives, minimum pension liability or retained interests in securitized assets.

A component of the shareholders' equity account, accumulated other comprehensive income, that derives from unrealized gains or losses on retained interests in securitized assets.

Accumulated other comprehensive income (loss) arising from changes in the fair value of investments accounted for as available-for-sale. On the cash flow analysis statement the account is used in computing long-term investments, a component of investment of sustainable free cash flow and in computing other nonrecurring cash receipts (disbursements), a component of investment of sustainable free cash flow.

The actuarial present value of any pension benefits earned to date on a defined benefit pension plan. Measurement is based on historical compensation rates for pay-related plans.

The cumulative amount by which property, plant and equipment has been expensed through depreciation through time.

The cumulative proportion that property, plant and equipment gross has been expensed through depreciation. The measure provides an approximation to the portion of property, plant and equipment that has been consumed though operations and affords some insight into the age of a firm's productive capacity.

The cumulative amount that property, plant and equipment has been expensed through depreciation. It is reported as a contra asset to property, plant and equipment, gross. On the financial performance report the account is used in computing ratios measuring activity.

Cumulative gains or losses reported in shareholders' equity that arise from changes in the fair value of available-for-sale securities, from the effects of changes in foreign-currency exchange rates on consolidated foreign-currency financial statements, from certain gains and losses on financial derivatives and from adjustments for under-funded pension plans. On the cash flow analysis statement the account is used in computing other nonrecurring cash receipts (disbursements), a component of investment of sustainable free cash flow.

The cash paid in acquiring another business entity.

Intangible assets, other than goodwill, arising as a result of an acquisition. Examples include patents, trademarks, brands, customer lists and non-compete agreements.

Performance measures focused on analyzing efficiency of operations by expressing various balance sheet accounts in terms of revenue days, the number of days it would take to recover the item through revenue from core operations measured on a per-day basis using a 365-day year.

A term used on the cash flow analysis statement that consists of the change in cash and cash equivalents between reporting periods.

The excess of the accumulated benefit obligation, both vested and nonvested, over the fair value plan assets on a defined-benefit pension plan that must be added to liabilities as reported on the balance sheet. If the pension plan sponsor's books do not already carry a net pension liability equal to or greater than the excess of the accumulated benefit obligation over the fair value of plan assets, then an adjustment, known as the additional minimum pension liability, is recorded for the amount needed to bring the previously reported net pension liability up to the amount of the excess of the accumulated benefit obligation over the fair value of plan assets. On the cash flow analysis statement the account is used in computing other nonrecurring cash receipts (disbursements), a component of investment of sustainable free cash flow.

The dollar amount of an entity's capital paid in by common shareholders in excess of that amount considered to be legal capital. Generally, it is the proceeds received upon the issue of shares in excess of par value or stated value. Additional paid-in capital represents one component of common shareholders' claims on the assets, earnings and cash flows of an entity resulting from amounts paid in when shares were issued to them. On the cash flow analysis statement the account is used in computing common equity financing, a component of financing transactions.

An adjustment to income taxes (paid) recovered on continuing operations for tax payments or recoveries related to investing-related or financing-related transactions. For example, income taxes (paid) on continuing operations would be reduced for taxes paid on a gain from the sale of an investment (an investing-related transaction). Similarly, income taxes (paid) on continuing operations would be increased for a tax recovery arising from a loss incurred on an early-retirement of debt (a financing-related transaction). Such adjustments remove the related taxes from operating cash flow and transfer their amounts to other nonrecurring cash receipts (disbursements).

Conventional Earnings before Interest, Taxes, Depreciation, and Amortization (EBITDA) with additional adjustments for other non-cash or nonrecurring items of revenue, expense, gain, and loss.

Reported operating cash flow adjusted for the reclassification of selected nonoperating items and for nonrecurring items of operating cash flow.

See also: Sustainable operating cash flow

The amount of outstanding accounts receivable at the balance sheet date that are estimated to be uncollectible. It is reported as a contra-asset, subtracted on the balance sheet from outstanding accounts receivable. On the financial performance report the account is used in computing ratios measuring activity.

See also: Allowance for doubtful receivables

The amount of outstanding notes receivable at the balance sheet date that are estimated to be uncollectible. It is reported as a contra-asset, subtracted on the balance sheet from outstanding notes receivable. On the financial performance report the account is used in computing ratios measuring activity.

See also: Allowance for doubtful receivables

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Abbreviation for balance sheet.

A Cash Flow Analytics, LLC report designed to report a firm's financial position as of a point in time with particular emphasis on assets and liabilities that are central to a firm's cash flow generations, including operating working capital asset and operating working capital liabilities, other operations-related assets and other investing-related assets, other operations-related liabilities and other financing-related liabilities.

An automatic adjustment made by CFA to account for the difference, if any, between total assets and the sum of total liabilities, mezzanine interests, and shareholders' equity. Reported as a component of other shareholders' equity.

Input data for Cash Flow Analytics, LLC forecast reports derived from the balance sheet.

An amount that is automatically calculated that is needed to render an equality between total assets and total liabilities, mezzanine interests and shareholders' equity. When the balance sheet is out of balance, the user will be prompted with a warning indicating that a careful check should be made to determine the reason and resolve the discrepancy. On the cash flow analysis statement the account is used in computing other equity-related financing, a component of financing transactions.

Checks presented for payment that exceed a company's bank balance. A book overdraft becomes a bank overdraft when outstanding checks are presented for payment.

The status of an entity, typically a special-purpose entity, that protects its assets from the claims of creditors or shareholders of the company that created it and likely controls it, in the event that that sponsoring company experiences financial difficulties.

Billings in excess of cost incurred plus profit recognized on contracts accounted for under percentage-of-completion accounting. The account is a form of deferred revenue because it represents billings to customers in excess of revenue recognized. On the cash flow analysis statement the account is used in computing change in deferred revenue, a component of cash from revenue.

The purpose of Bollinger Bands is to provide a relative definition of high and low. By definition prices are high at the upper band and low at the lower band. This definition can aid in rigorous pattern recognition and is useful in comparing price action to the action of indicators to arrive at systematic trading decisions.

Bollinger Bands consist of a set of three curves drawn in relation to securities prices. The middle band is a measure of the intermediate-term trend - a simple moving average - that serves as the base for the upper and lower bands. The interval between the upper and lower bands and the middle band is determined by the standard deviation of the same data that were used for the average. The default parameters, 20 periods and 2 standard deviations, may be adjusted to suit your purposes.

Net income reported in the shareholder income statement as opposed to the tax return.

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The weighted average number of diluted common shares outstanding during a reporting period.

Net income as calculated by the model measured by netting all revenues and gains with expenses and losses. The account is used as a data-entry check. A warning indicator is given when calculated net income (loss) is not equal to company reported net income (loss). When the two amounts are not equal, reasons for the difference should be identified and resolved.

Capital expenditures as computed using a balance sheet change approach measured relative to capital expenditures as reported on the company-prepared statement of cash flows.

The change in inventory as computed using a balance sheet change approach measured relative to the change in inventory as reported on the company-prepared statement of cash flows.

The change in operating payables and accruals as computed using a balance sheet change approach measured relative to the change in accounts payable and accruals as reported on the company-prepared statement of cash flows.

The change in operating receivables as computed using a balance sheet change approach measured relative to the change in accounts receivable as reported on the company-prepared statement of cash flows.

The computation of income taxes (paid) or recovered based on income from continuing operations using income tax expense and changes in tax-related balance sheet accounts.

A contract that gives its holder the right to buy an asset, typically a financial instrument, at a specified price through a specified date.

Expenditures made in the purchase of long-term productive assets such as property, plant and equipment, whose cost is amortized against income in future periods. It is measured net of cash received for related asset dispositions. It is calculated as the change in the book value of PP&E, increased for depreciation expense and impairment charges on PP&E, reduced for gains on disposal and increased for losses on disposal, and reduced for interest capitalized to PP&E, which is used to increase interest paid.

Capital expenditures and other investment needed to support operations that are directly linked to revenue growth, consisting of investment in operations-related intangibles and investment in other ops-related assets, as a percentage of revenue from core operations. Short-term changes in disbursements for capital expenditures and other investment needed to support operations can raise or lower sustainable free cash flow. Capital expenditures and investment to support operations to revenue % provides insight into the effects on sustainable free cash flow of changes in spending patterns for capital expenditures and investment to support operations

The driver underlying capital expenditures. In particular, capital expenditures are measured as a percentage of revenue from core operations on the presumption that capital expenditures will generally grow along with revenue and the scale of operations.

The net (increase) in the capitalized value of operating leases, which serves as a proxy for the capital expenditures equivalent of new operating leases.

A component of the free cash growth profile reflecting the intensity of capital spending relative to revenue, measured as capital expenditures and investment to support operations divided by revenue.

The number of times that capital expenditures cover a proxy for the portion of property, plant and equipment consumed during a reporting period. Measures above one indicate that productive capacity is being increased. Measures below one indicate that productive capacity is being depleted.

Capital expenditures divided by revenue from core operations. Short-term changes in disbursements for capital expenditures can raise or lower sustainable free cash flow. Capital expenditures to revenue % provides insight into the effects on sustainable free cash flow of changes in capital expenditure patterns.

A lease that transfers, in an economic sense, the risks and rewards of ownership to the lessee without transferring title. Lease payments made are comprised of interest and principal. Property held under a capital-lease agreement is accounted for as an asset. This cost is amortized over the relevant useful life.

An estimate of the present value of operating leases calculated dividing the current rent expense by the discount rate of 12.5%.

Costs incurred in the incurrence and issue of debt, including but not limited to such costs as, commitment fees, appraisals, legal fees, recording fees, and points. Capitalized debt-issue costs are amortized to interest expense over the term of the debt issue. On the cash flow analysis statement the account is used in computing total interest paid, a component of sustainable operating cash flow.

Interest incurred during the construction period on monies invested in assets under construction that is added to the cost of the assets. Interest may be capitalized to inventory or to property, plant and equipment under construction. Capitalized interest should be kept separate from other capitalized operating expenses. Adjustments are made to remove capitalized interest from inventory and PP&E and add it to interest paid.

Capitalized operating expenses measured in terms of revenue from core operations per day. Calculated as capitalized operating expenses divided by revenue from core operations measured on a daily basis using a 365-day year.

See also: Capitalized operating expenses days

Capitalized operating expenses measured in terms of revenue from core operations per day. Calculated as capitalized operating expenses divided by revenue from core operations measured on a daily basis using a 365-day year.

See also: Capitalized operating expenses (in revenue days)

Capitalized operating expenses as a percentage of revenue from core operations. In effect, the proportion of revenue from core operations tied up in capitalized operating expenses as of the end of a reporting period.

Currency, coin, and funds on deposit that are available for immediate withdrawal without restriction. Money orders, certified checks, cashier's checks, personal checks, and bank drafts are also considered cash.

The net cash used in the repurchase of shares issued as a result of option exercises. 

The balance in cash and cash equivalents as reported on the balance sheet. On the cash flow analysis statement the account is used in computing change in cash and equivalents after financing.

On the forecast balance sheets this account measures the balance in cash and cash equivalents as reported on the last available historical balance sheet before the beginning of the forecast period.

The balance in cash and cash equivalents as reported on the balance sheet at the end of the previous reporting period and at the beginning of the current reporting period.

The balance in cash and cash equivalents as reported on the balance sheet at the end of the current reporting period. On the forecast balance sheets this account is computed as cash and equivalents - beginning historical balance plus the projected cumulative increase (decrease) in cash and equivalents.

cash and cash equivalents measured in terms of revenue from core operations per day. Calculated as cash and cash equivalents divided by revenue from core operations measured on a daily basis using a 365-day year.

Cash and cash equivalents divided by revenue

Cash and cash equivalents plus short-term investments and trading securities.

Cash and cash equivalents and short-term investments measured in terms of revenue from core operations per day. Calculated as cash and cash equivalents and short-term investments divided by revenue from core operations measured on a daily basis using a 365-day year.

Cash and cash equivalents plus short-term investments and trading securities all divided by the number of common shares outstanding at period end.

Cash and cash equivalents plus short-term investments divided by revenue

Cash and cash equivalents plus short-term investments divided by revenue

Cash payments to vendors and other suppliers, including employees, for the purchase of products and the procurement of services provided to customers. Calculated as the cost of revenue (excluding depreciation and amortization) adjusted for the change in inventory and the change in operating payables.

The time span, calculated based on revenue from core operations measured on a daily basis using a 365-day year, during which a firm's own cash is used to acquire or produce goods and services, which in turn are sold to customers, who in turn ultimately pay for their purchases in cash. It is calculated as operating receivables days plus inventory (incl. capitalized interest) days plus capitalized operating expenses days, plus prepaids days, minus deferred revenue days, minus operating payables days minus accruals days. Reductions in the cash cycle indicate improving efficiencies in managing operating working capital.

See also: Operating working capital measured in revenue days

A coverage ratio that measures the number of times that sustainable free cash flow calculated after required principal payments on long-term debt and capital lease obligations covers dividends on common stock.

Cash paid for common and preferred dividends as carried on the company-reported indirect method statement of cash flows.

Net income plus goodwill amortization.

Short-term and highly liquid investments readily convertible into known amounts of cash and close enough to maturity (e.g., original maturities of 90 days or less) that there is insignificant risk of changes in value from interest rate movements.

An unspecified term that may refer to either total cash flow or operating cash flow. In most cases, use of the term refers to operating cash flow.

There are numerous nonoperating and nonrecurring items for which reported operating cash flow should be adjusted before it is used in analysis. The Cash Flow Analysis Statement adjusts for most of these items with entry of company-reported data from the statements of income and balance sheet. However, certain adjustments require additional manual data input. These adjustment items, found on the Statement of Income and Related Data Input spreadsheet, are labeled with an asterisk (*) and the letters (CF Adj). Note that with quarterly financial statements, data necessary for manual input are typically not available.

See also: CF Adj

The search for the fundamental drivers that underlie a company's cash flow stream and affect its sustainability.

A Cash Flow Analytics, LLC report designed to facilitate analysis that provides multiple partitions of the overall change in cash and cash equivalents and highlight sustainable and nonrecurring sources and uses of cash. The statement is a combination of the direct and indirect cash flow formats, showing the reconciliation of key items from the statement of income to their cash flow counterparts. Important subtotals on the cash flow analysis statement include Core operating cash flow, Sustainable operating cash flow, and Sustainable free cash flow.

The Cash Flow Analytics, LLC proprietary model stock selection score. The score ranges from 0 to 7. In their research paper, An Examination of Abnormal Returns Generated by the Cash Flow Analytics Proprietary Model, Jonathan Clarke and Charles Mulford demonstrate that stocks with Cash Flow Analytics Scores of 0 or 1 significantly under-performed a size-based index while stocks with scores of 6 or 7 significantly out-performed a size-based index. Stocks with scores of 2 or 3 moderately under-performed and stocks with scores of 4 or 5 moderately out-performed a size-based index.

Core operating cash flow plus other recurring cash receipts (disbursements) and less income taxes paid. Cash flow available for debt service is cash flow available for the payment of interest and required principal payments on debt and capital leases.

The number of times that cash flow available for debt service covers interest paid and required principal payments on long-term debt and capital lease obligations. It is a measure of debt service coverage indicating how well cash flow that is available to service debt covers total interest paid and the required principal payments on long-term debt and capital lease obligations.

The number of times that cash flow available for debt service covers total interest paid. It is a measure of debt service coverage indicating how well cash flow that is available to service interest covers total interest paid.

The percentage change in cash flow available for debt service from one period to the next.

The percentage change in cash flow available for debt service from the same quarter the previous year to the current quarter.

The number of times that cash flow available for debt service covers total debt service requirements. It is a measure of debt service coverage indicating how well cash flow that is available to service debt covers total interest paid and the required principal payments on long-term debt and capital lease obligations.

The number of times that cash flow available for debt service covers total interest paid. It is a measure of debt service coverage indicating how well cash flow that is available to service interest covers total interest paid.

Cash flow available for capital expenditures and other investments needed to support operations. It is calculated as sustainable operating cash flow less dividends paid on preferred stock.

A coverage ratio that measures the number of times that cash flow available for capital expenditures and other investments needed to support operations covers such investments needed to support operations.

The percentage change in cash flow available for investment from one period to the next.

The percentage change in cash flow available for investment between the same quarter of the previous year and the current quarter.

The factors that drive or result in increases or decreases in core operating cash flow, sustainable operating cash flow and sustainable free cash flow over time measured here for a four-quarters ending reporting period. An understanding of cash flow drivers facilitates the formation of expectations regarding cash flow sustainability.

A Cash Flow Analytics, LLC report designed to highlight the factors driving core operating cash flow, sustainable operating cash flow, and sustainable free cash flow higher or lower over time so that sustainability of those measures can better be assessed and expectations can be formed regarding a firm's ability to continue generating them.

The capacity of a firm to generate cash flow as it grows, without referring to specifically whether the cash flow generated is core operating cash flow or sustainable free cash flow. A firm's core operating growth profile™ is the capacity of the firm to generate core operating cash flow as it grows and reflects a combination of its operating cushion and operating working capital requirements, expressed as a percentage of revenue. A firm's free cash growth profile™ is the capacity of the firm to generate sustainable free cash flow as it grows and reflects a combination of its core operating growth profile™, income taxes paid as a % of revenue, and capital expenditures and other investments needed to support operations all expressed as a percentage of revenue. The cash flow growth profile™ is forward looking and reports the amount of cash flow that can be expected for any measured amount of growth in revenue under the assumption that a firm's core operating growth profile™ and/or its free cash growth profile™ remain unchanged. A firm with a positive cash flow growth profile™ can grow operations and produce increasing amounts of cash flow. A firm with a negative cash flow growth profile™ will require other sources of cash to support revenue growth.

A cash flow measure divided by the diluted number of common shares outstanding during a reporting period.

A Cash Flow Analytics, LLC report designed to provide a quick view of trends in one company's cash flow performance over time or how a company compares with others at a point in time.

A Cash Flow Analytics report designed to provide a quick view of trends in one company's cash flow performance over time or how a company compares with others at a point in time.

Sources of data for input to Cash Flow Analytics, LLC reports that come primarily from a company prepared statement of cash flows.

A summary of the components of Sustainable free cash flow.

A summary of the components of Sustainable free cash flow for a four-quarters ending reporting period.

A measure of the sustainability of reported operating cash flow. It is computed as the difference between sustainable operating cash flow and reported operating cash flow expressed as a percent of revenue. Sustainable operating cash flow will typically differ from reported operating cash flow due to various nonoperating and/or nonrecurring items. The inclusion of nonoperating and/or nonrecurring cash flow items in reported operating cash flow will result in readings below 0. The Cash Flow Analysis Statement adjusts for most of these items with entry of company-reported data from the statements of income and balance sheet. However, certain adjustments require additional manual data input. These adjustment items, found on the Statement of Income and Related Data Input spreadsheet, are labeled with an asterisk (*) and the letters (CF Adj). Note that with quarterly financial statements, data necessary for manual input are typically not available.

See also: CF Adj; Cash flow adjustment item

Cash collections from customers for product sales and services provided. Calculated as revenue from core operations adjusted for the change in operating receivables and the change in deferred revenue.

Cash from revenue minus cash cost of revenue. It is a cash-based measure of gross profit.

The measured effects of the change in accruals days on the change in accruals from one period to the next.

The measured effects of the change in capitalized operating expenses days on the change in capitalized operating expenses from one period to the next.

The measured effects of the change in deferred revenue days on the change in deferred revenue from one period to the next.

The measured effects of the change in gross margin % on the change in gross margin (excl. depreciation & amortization) from one period to the next.

The measured effects of the change in gross margin % on the change in gross margin (excl. depreciation & amortization) from one period to the next.

The measured effects of the change in inventory days on the change in inventory (incl. capitalized interest) from one period to the next.

The measured effects of the change in operating cushion % on the change in operating cushion from one period to the next.

The measured effects of the change in operating receivables days on the change in operating receivables from one period to the next.

The measured effects of the change in operating working capital days on the change in operating working capital from one period to the next.

The measured effects of the change in payables days on the change in payables from one period to the next.

The measured effects of the change in prepaids days on the change in prepaids from one period to the next.

The measured effects of the change in R&D % on the change in research and development expense from one period to the next.

The measured effects of the change in receivables days on the change in operating receivables from one period to the next.

The measured effects of the change in SG&A % on the change in selling, general and administrative expense (excl. depreciation & amortization) from one period to the next.

A summary of the measured effects of changes in the components of operating cushion %, gross margin %, SG&A % and R&D %, on the change in operating cushion from one period to the next.

The measured effects of changes in capital expenditures and investment to revenue % on the change from one period to the next in capital expenditures and investment to support operations.

The measured effects of changes in capital expenditures to revenue % on the change in capital expenditures from one period to the next.

The measured effects of changes in investment in operations-related intangibles to revenue % on the change in investment in operations-related intangibles from one period to the next.

The measured effects of changes in investment in operations other operations-related assets to revenue % on the change in investment in other operations-related assets from one period to the next.

The measured effects of the change in operating cushion % on the change in operating cushion from one period to the next plus the measured effects of the change in operating working capital days on the change in operating working capital from one period to the next.

The total measured effects of growth in revenue from core operations on various cash flow drivers.

The measured effects of growth in revenue from core operations and changes in capital expenditures to revenue % on the change in capital expenditures from one period to the next.

The measured effects of growth in revenue from core operations and changes in investment in operations-related intangibles to revenue % on the change in investment in operations-related intangibles from one period to the next.

The measured effects of growth in revenue from core operations and changes in investment in other operations-related assets to revenue % on the change in investment in other operations-related assets from one period to the next.

The measured effects of growth in revenue from core operations on changes in operating cushion and operating working capital from one period to the next plus the measured effects of changes in operating cushion % on the change in operating cushion from one period to the next and the effects of changes in operating working capital days on the change in operating working capital from one period to the next.

The measured effects of growth in revenue from core operations on the change in accruals from one period to the next.

The measured effects of growth in revenue from core operations on the change in capital expenditures from one period to the next.

The measured effects of growth in revenue from core operations on the change from one period to the next in capital expenditures and investment to support operations.

The measured effects of growth in revenue from core operations on the change in capital expenditures from one period to the next.

The measured effects of growth in revenue from core operations on the change in capitalized operating expenses from one period to the next.

The measured effects of growth in revenue from core operations on the change in deferred revenue from one period to the next.

The measured effects of growth in revenue from core operations on the change in gross margin from one period to the next.

The measured effects of growth in revenue from core operations on the change in inventory from one period to the next.

The measured effects of growth in revenue from core operations on the change in investments in operations-related intangibles from one period to the next.

The measured effects of growth in revenue from core operations on the change in investment in other operations-related assets from one period to the next.

The measured effects of growth in revenue from core operations on the change in operating cushion from one period to the next.

The measured effects of growth in revenue from core operations on the change in operating payables from one period to the next.

The measured effects of growth in revenue from core operations on the change in operating receivables from one period to the next.

The measured effects of growth in revenue from core operations on the change in operating working capital from one period to the next.

The measured effects of growth in revenue from core operations on the change in investment in other operations-related assets from one period to the next.

The measured effects of growth in revenue from core operations on the change in prepaids from one period to the next.

The measured effects of growth in revenue from core operations on the change in R&D from one period to the next.

The measured effects of growth in revenue from core operations on the change in SG&A from one period to the next.

The measured effects of growth in revenue from core operations and changes in capital expenditures to revenue % on capital expenditures.

The measured effects of growth in revenue from core operations and changes in investment in operations-related intangibles to revenue % on investment in operations-related intangibles.

The measured effects of growth in revenue from core operations and changes in investment in other operations-related assets to revenue % on investment in other operations-related assets.

The measured effects of growth in revenue from core operations and changes in accruals days on the change in accruals from one period to the next.

The measured effects of growth and changes in capitalized operating expenses days on the change in capitalized operating expenses from one period to the next.

The measured effects of growth in revenue from core operations and changes in deferred revenue days on the change in deferred revenue from one period to the next.

The measured effects of growth in revenue from core operations and changes in GM % on the change in gross margin (excl. depreciation & amortization) from one period to the next.

The measured effects of growth in revenue from core operations and changes in inventory days on the change in inventory from one period to the next.

The measured effects of growth in revenue from core operations and changes in profitability, namely gross margin %, SG&A % and R&D %, on changes in operating cushion from one period to the next.

The measured effects of growth in revenue from core operations and changes in operating payables days on the change in operating payables from one period to the next.

The measured effects of growth in revenue from core operations and changes in operating receivables days on the change in operating receivables from one period to the next.

The measured effects of growth in revenue from core operations and changes in operating working capital days on the change in operating working capital from one period to the next.

The measured effects of growth in revenue from core operations and changes in prepaids days on the change in prepaids from one period to the next.

The measured effects of growth in revenue from core operations and changes in R&D % on the change in research and development expense from one period to the next.

The measured effects of growth in revenue from core operations and changes in SG&A % on the change in selling, general and administrative expense (excl. depreciation & amortization) from one period to the next.

Cash paid for sales and marketing, general and administrative, and research and development expenditures. It is calculated as selling, general and administrative expense (excluding depreciation and amortization) plus research and development expense, adjusted for changes in capitalized operating expenses, prepaids and accruals.

Cash disbursements, net of cash received, made for acquisitions during a period as reported in the investing section of a company-prepared statement of cash flows. The account is used on the cash flow drivers report to measure the impact of acquisitions and other transactions, such as translation effects due to changes in currency exchange rates, on reported cash provided (used) by operating activities.

See also: Reported cash paid for acquisitions

The quarterly, year-to-date cash disbursements, net of cash received, made for acquisitions during a period as reported in the investing section of a company-prepared statement of cash flows. The account is used on the cash flow drivers report to measure the impact of acquisitions and other transactions, such as translation effects due to changes in currency exchange rates, on reported cash provided (used) by operating activities.

See also: Reported cash paid for acquisitions

Cash disbursements for repurchases of shares. This is a cash flow adjustment item. It is disclosed on the statement of cash flows in the cash provided or used by financing activities section. On the cash flow analysis statement the account is used in computing net cash paid in buyback of shares for options, a component of other recurring cash receipts (disbursements) and cash flow available for debt service and in computing common equity financing, a component of financing transactions. Note that for the model to complete the calculation of cash paid in buyback of shares for options, five input items are needed: (1) *No. Of common shares repurchased during period (mln) (CF Adj) (2) *Tax benefits from stock options exercised (CF Adj)
(3) *Cash paid for common shares repurchased during period (CF Adj) (4) *No. Of common stock options exercised during period (CF Adj) and (5) *Avg. Exercise price per share received for options exercised (CF Adj).

A term defined by generally accepted accounting principles that consists of cash receipts and payments involving liability and stockholders' equity items, including obtaining cash from creditors and repaying amounts borrowed and obtaining capital from owners and providing them with a return on and a return of, their investments.

See also: Reported cash provided (used) by financing activities

A term defined by generally accepted accounting principles that consists of that consists of cash receipts and payments involving long-term assets, including making and collecting loans and acquiring and disposing of investments and property, plant and equipment.

See also: Reported cash provided (used) by investing activities

A term defined by generally accepted accounting principles that consists of that consists of the cash effects of transactions that enter into the determination of net income such as cash receipts from sales of goods and services and cash payments to suppliers and employees for acquisitions of inventory and services. Interest and income taxes paid are also included. Also referred to as operating cash flow and cash flow from operations.

See also: Reported cash provided (used) by operating activities

That portion of a life insurance premium that will be returned to the policyholder in the event the policy is canceled.

Cash and cash equivalents plus short-term investments and trading securities plus long-term investments, all divided by the number of common shares outstanding at period end.

In contrast to the accrual basis, under this accounting basis revenues are recognized as cash is received and expenses as cash is paid.

The fundamental factors, especially those of growth and changes in profitability and efficiency, that serve to increase or decrease core operating cash flow, sustainable operating cash flow and sustainable free cash flow over time.

The measured effects of cash-flow drivers, especially of growth and changes in profitability and efficiency, on core operating cash flow, sustainable operating cash flow and sustainable free cash flow.

A summary of all measured effects of cash-flow drivers, especially of growth and changes in profitability and efficiency, on core operating cash flow, sustainable operating cash flow and sustainable free cash flow.

Performance measures focused on analyzing cash flow results.

Determining whether cash flows are associated with nonrecurring items of revenue, gain, expense, and loss. The timing of the cash flows is also investigated.

The percentage of revenue from core operations that results in core operating cash flow. It is driven by a firm's operating cushion and its requisite investment in operating working capital.

An abbreviation to indicate that the input is a cash flow adjustment item. There are numerous nonoperating and nonrecurring items for which reported operating cash flow should be adjusted before it is used in analysis. The Cash Flow Analysis Statement adjusts for most of these items with entry of company-reported data from the statements of income and balance sheet. However, certain adjustments require additional manual data input. These adjustment items, found on the Statement of Income and Related Data Input spreadsheet, are labeled with an asterisk (*) and the letters (CF Adj). Note that with quarterly financial statements, data necessary for manual input are typically not available.

See also: Cash flow adjustment item

Abbreviation for Cash Flow Drivers Report.

CICS. Based on a study by E. Fama and K. French, "Industry costs of equity," Journal of Financial Economics, Volume 43, pp. 153 - 193. The classification system maps the SIC (Standard Industrial Classification) to a reduced set of 49 industries.

The Cash Flow Analytics, LLC proprietary model stock selection score. The score ranges from 0 to 7. In their research paper, An Examination of Abnormal Returns Generated by the Cash Flow Analytics Proprietary Model, Jonathan Clarke and Charles Mulford demonstrate that stocks with scores of 0 or 1 significantly under-performed a size-based index while stocks with scores of 6 or 7 significantly out-performed a size-based index. Stocks with scores of 2 or 3 moderately under-performed and stocks with scores of 4 or 5 moderately out-performed a sized-based index.

The Cash Flow Analytics Score™ measured for a four-quarters ending reporting period.

Abbreviation for Cash Flow Analysis Statement.

Income from operations and the gain or loss on disposal of a discontinued business segment or separately measured business unit. It is reported after income tax effects have been subtracted. On the cash flow statement (indirect method) the account balance is removed from net income (loss) in computing Income (loss) from continuing operations.

See also: Discontinued operations

The cumulative, prior-years income effect of a change in accounting principle. It is reported after income tax effects have been subtracted. On the cash flow analysis statement the account is used in computing other nonrecurring cash receipts (disbursements), a component of investment of sustainable free cash flow.

The period-to-period increase or decrease in operating costs or expenses that have been incurred but not paid. An increase in accruals, a liability, is a source of cash; a decrease is a use of cash.

See also: Accruals

A source or (use) of cash arising from the increase or decrease in accumulated other comprehensive income or (loss) related to available-for-sale investments. 

A term used on the cash flow analysis statement that refers to the change in accumulated other comprehensive income between reporting periods.

A source or (use) of cash arising from the period-to-period increase or decrease in the additional minimum pension liability.

The period-to-period change in the balance sheet adjustment account.  On the cash flow analysis statement, an increase is a source of cash and a decrease is a use of cash included in Other equity-related financing in the Financing transactions section.

The period-to-period increase or decrease in capitalized debt-issue costs. An increase in capitalized debt-issue costs, an asset, is a use of cash; a decrease is a source of cash.

The period-to-period increase or decrease in capitalized operating expenses, or assets to be amortized against future revenue. An increase in capitalized operating expenses is a use of cash; a decrease is a source of cash.

See also: Capitalized operating expenses

The actual change in cash and equivalents during a reporting period. It can be calculated as the ending balance in cash and equivalents less the beginning balance.

The actual change in cash and equivalents during a reporting period. It can be calculated as the ending balance in cash and equivalents less the beginning balance. It can also be calculated as the change in cash and equivalents before external financing plus cash provided from external financing less cash used in external financing.

Sustainable free cash flow less investments of sustainable free cash flow. It is the change in cash and equivalents excluding the effects of any external financing.

See also: Change in cash before external financing

Sustainable free cash flow less investments of sustainable free cash flow. It is the change in cash and equivalents excluding the effects of any external financing.

See also: Change in cash and equivalents before financing

The period-to-period change in common equity.  On the cash flow analysis statement, an increase is a source of cash and a decrease is a use of cash reported as Common equity financing in the Financing transaction section. 

The period-to-period increase or decrease in revenue that is collected in advance of being earned. An increase in deferred revenue, a liability, is a source of cash; a decrease is a use of cash.

See also: Deferred revenue

The period-to-period increase or decrease in future tax benefits resulting from deductible temporary differences or loss or tax-credit carryovers. An increase in deferred tax assets is a use of cash; a decrease is a source of cash.

See also: Deferred tax assets

The measured effects of the change in deferred tax assets to income before income taxes on the change in deferred tax assets from one period to the next.

The period-to-period increase or decrease in future tax obligations resulting from taxable temporary differences. An increase in deferred tax liabilities is a source of cash; a decrease is a use of cash.

See also: Deferred tax liabilities

The measured effects of the change in deferred tax liabilities to income before income taxes on the change in deferred tax liabilities from one period to the next.

The period-to-period change in dividends payable.  On the cash flow analysis statement, an increase is a source of cash and a decrease is a use of cash reported as Dividends on common stock in the Financing transactions section.

The measured effects of the change in the effective tax rate on the change in income tax (expense) benefit from one period to the next.

The period-to-period change in goodwill and acquisition-related intangibles, net.  On the cash flow analysis statement, a decrease is a source of cash and an increase is a use of cash reported in the Investment of sustainable free cash flow section.

The period-to-period increase or decrease in gross margin (excl. depreciation and amortization). An increase in gross margin (excl. depreciation and amortization) is a source of cash, a decrease is a use of cash.

The period-to-period increase or decrease in income taxes (paid) or recovered resulting from a change in the total (provision) benefit for income taxes.

The period-to-period increase or decrease in income taxes presently due and payable to a taxing authority. An increase in income taxes payable, a liability, is a source of cash; a decrease is a use of cash.

See also: Income taxes payable

The measured effects of the change in income taxes payable to income before income taxes on the change in income taxes payable from one period to the next.

The (use) or source of cash arising from an increase or decrease in an intangible asset related to a company's pension plan.

The period-to-period increase or decrease in amounts due for interest incurred. An increase in interest payable, a liabilities, is a source of cash; a decrease is a use of cash.

The period-to-period increase or decrease in the cost of goods held for resale in the ordinary course of operations as reported on the cash flow analysis statement. An increase in inventory, an asset, is a use of cash; a decrease is a source of cash. The change in inventory from one period to the next is adjusted for interest capitalized and for any provision for inventory impairment. For example, an increase in inventory from one period to the next is reduced for interest capitalized to inventory, which is also used to adjust upward interest paid. An increase in inventory is also adjusted upward for any provision for impairment of inventory, which is used to reduce cost of revenue.

See also: Change in inventory; Inventory; Inventory (incl. capitalized interest)

The increase or decrease in inventory resulting in a (use) or source of cash, calculated to include the effects of capitalized interest, if any.

The period-to-period increase or decrease in the cost of goods held for resale in the ordinary course of operations as reported on the balance sheet, excluding adjustments for interest capitalized to inventory and any provision ofr inventory impairment. An increase in inventory, an asset, is a use of cash; a decrease is a source of cash.

See also: Change in inventory; Inventory; Inventory (incl. capitalized interest)

The period-to-period increase or decrease in the cost of goods held for resale in the ordinary course of operations. An increase in inventory, an asset, is a use of cash; a decrease is a source of cash. The change in inventory from one period to the next is adjusted for interest capitalized and for any provision for inventory impairment. For example, an increase in inventory from one period to the next is reduced for interest capitalized to inventory, which is also used to adjust upward interest paid. An increase in inventory is also adjusted upward for any provision for impairment of inventory, which is used to reduce cost of revenue.

See also: Change in inventory; Inventory; Inventory (incl. capitalized interest)

The period-to-period change in other unidentified assets.  On the cash flow analysis statement, an increase is a use of cash and a decrease is a source of cash as reported in the Investment of sustainable cash flow section. 

The one-year change in leverage measured as a percentage of the previous year's amount. Leverage is measured as total borrowings divided by shareholders' equity. When shareholders' equity is a negative amount, leverage is reported as NM. The change in leverage from a positive to a negative amount or from a negative amount to a more negative amount is reported as an increase in leverage. The change in leverage from a negative amount to a less negative or positive amount is reported as a reduction in leverage.

The period-to-period change in long-term financing obligations.  On the cash flow analysis statement, an increase is a source of cash and a decrease is a use of cash reported as Long-term debt financing in the Financing transactions section.

The period-to-period change in the balance in long-term investments.  On the cash flow analysis statement, an increase is a use of cash and a decrease is a source of cash reported in the Investment of sustainable free cash flow section.

The period-to-period change in minority interest in equity.  On the cash flow analysis statement, an increase is a source of cash and a decrease is a use of cash reported as Other equity-related financing in the Financing transactions section.

The period-to-period change in net assets of a discontinued business segment or unit.  On the cash flow analysis statement the account balance decline is reported as disposition of discontinued operations, a source of cash, in the Investment of sustainable free cash flow section.

The period-to-period increase or decrease in operating cushion. An increase in operating cushion is a source of cash, a decrease is a use of cash.

See also: Operating cushion

The period-to-period increase or decrease in amounts due vendors, including accounts payable and notes payable, for purchases made. An increase in operating payables, a liability, is a source of cash; a decrease is a use of cash.

See also: Operating payables

The period-to-period increase or decrease in amounts due from customers, including accounts receivable and notes receivable, as reported on the cash flow analysis statement. An increase in operating receivables, an asset, is a use of cash; a decrease is a source of cash. The change in operating receivables from one period to the next is adjusted for any provision for doubtful receivables. For example, an increase in operating receivables is adjusted upward for a provision for doubtful receivables, which is also used to reduce selling, general and administrative expense.

See also: Change in operating receivables; Operating receivables

The increase or decrease in operating receivables resulting in a (use) or source of cash, calculated before a writedown, if any, of the underlying receivables.

The period-to-period increase or decrease in amounts due from customers, including accounts receivable and notes receivable as reported on the balance sheet. Excluded is the effect on operating receivables of the provision for doubtful receivables incl. in SG&A. An increase in operating receivables, an asset, is a use of cash; a decrease is a source of cash.

The period-to-period increase or decrease in amounts due from customers, including accounts receivable and notes receivable, as reported on the cash flow analysis statement. An increase in operating receivables, an asset, is a use of cash; a decrease is a source of cash. The change in operating receivables from one period to the next is adjusted for any provision for doubtful receivables. For example, an increase in operating receivables is adjusted upward for a provision for doubtful receivables, which is also used to reduce selling, general and administrative expense.

See also: Change in operating receivables; Operating receivables

The period-to-period increase in operating working capital, or assets, including operating receivables, inventory, prepaids and capitalized operating expenses, that are used in operations less liabilities, including deferred revenue, operating payables, and accruals, that are incurred in operations. An increase in operating working capital is a use of cash, a decrease in operating working capital is a source of cash.

See also: Operating working capital

The period-to-period change in other mezzanine interests, items not included with liabilities or shareholders' equity.  On the cash flow analysis statement, an increase is a source of cash and a decrease is a use of cash as Other equity-related financing in the Financing transactions section. 

A source or (use) of cash resulting from an increase or decrease in other unidentified operations-related liabilities.

The period-to-period increase or decrease in costs or expenses that have been paid in advance of being incurred. An increase in prepaids, an asset, is a use of cash; a decrease is a source of cash.

See also: Prepaids

The period-to-period increase or decrease in the book value of property, plant and equipment, or property, plant and equipment at cost less accumulated depreciation. An increase in property, plant and equipment, an asset, is a use of cash used in the calculation of capital expenditures; a decrease is a source of cash.

See also: Property, plant and equipment, net

The period-to-period increase or decrease in research and development expense. An increase in R&D is a use of cash, a decrease is a source of cash.

The source or (use) of cash resulting from an increase or decrease in a restructuring or merger-related reserve liability.

The period-to-period increase or decrease in selling, general and administrative expense (excl. depreciation and amortization). An increase in SG&A expense (excl. depreciation and amortization) is a use of cash, a decrease is a source of cash.

The period-to-period change in the balance in short-term investments and trading securities. On the cash flow analysis statement, an increase is a use of cash and a decrease is a source of cash as reported in the Investment of sustainable free cash flow section.

The period-to-period increase or decrease in a refund due from a taxing authority for income taxes paid in excess of amounts due. An increase in a tax refund receivable, an asset, is a use of cash; a decrease is a source of cash.

See also: Tax refund receivable

The measured effects of the change in tax refund receivable to income before income taxes on the change in the tax refund receivable from one period to the next.

Sources or (uses) of cash from issuing or repaying short-term debt as carried on the company-reported indirect method statement of cash flows.

The CFA Industrial Classification System. Based on a study by E. Fama and K. French, "Industry costs of equity," Journal of Financial Economics, Volume 43, pp. 153 - 193. The classification system maps the SIC (Standard Industrial Classification) to a reduced set of 49 industries.

The closing price on the last day of trading for the current period. Closing price is used in computing ratios measuring valuation.

Short-term financing obligations, including notes payable, negotiable instruments, and other forms of short-term borrowings. On the cash flow analysis statement the account is used in computing short-term debt financing, a component of financing transactions.

The dollar amount of dividends declared on common stock during the reporting period.

A corporation's residual ownership claims, including common stock, additional paid-in capital, retained earnings, accumulated other comprehensive income, other shareholders' equity, less stock held in treasury. 

Net proceeds from the issue of common stock. Changes in deferred compensation and subscription notes receivable are included in this caption.

A term used exclusively on the quarterly cash flow analysis statement to denote all financing related to common shareholders. Included in this caption are common stock and additional paid-in capital, other positive (negative) equity accounts, stock held in (treasury), other equity-related financing, (which includes minority interest in (income) loss, change in minority interest in equity, change in other mezzanine interests, and change in balance sheet adjustment), other inc (dec) in retained earnings, (which includes the change in retained earnings unexplained by net income (loss), dividends on preferred stock paid in cash, and dividends on common stock paid in cash), option and non-cash compensation expense incl. in SG&A, and interest paid with common stock.

A Cash Flow Analytics, LLC report designed to show all line items of the balance sheet measured as a percentage of total assets.

A Cash Flow Analytics, LLC report designed to show all line items of the cash flow analysis statement measured as a percentage of revenue from core operations.

A Cash Flow Analytics, LLC report designed to show all line items of the statement of income measured as a percentage of revenue from core operations.

The dollar amount of an entity's legal capital represented by the par value, stated value or, for common stock without a par value or stated value, the proceeds received upon the issue of shares. Common stock represents one component of common shareholders' claims on the assets, earnings and cash flows of an entity resulting from amounts paid in when shares were issued to them. On the cash flow analysis statement the account is used in computing common equity financing, a component of financing transactions.

Used for quarterly financial statements, the combination of common stock, the dollar amount of an entity's legal capital represented by the par value, stated value or, for common stock without a par value or stated value, the proceeds received upon the issue of shares plus additional paid-in capital, the dollar amount of an entity's capital paid in by common shareholders in excess of that amount considered to be legal capital. Netted against common stock and additional paid-in capital for quarterly financial statements are deferred compensation and subscription notes receivable.

The dollar amount of shares of common stock issued in lieu of the cash payment of dividends on common stock. On the cash flow analysis statement the account is used in computing dividends on common stock, a component of financing transactions and in computing common equity financing, a component of financing transactions.

Cash provided (used) by operating activities, investing activities and financing activities as actually reported by the company. Also reported is the effects of exchange rate changes on cash.

Net income (loss) as reported by the company. The account is used as a data-entry check. A warning indicator is given when calculated net income (loss) is not equal to company reported net income (loss). When the two amounts are not equal, reasons for the difference should be identified and resolved.

A Cash Flow Analytics, LLC report designed to report a firm's financial position as of the end of a quarterly reporting period with particular emphasis on assets and liabilities that are central to a firm's cash flow generations, including operating working capital asset and operating working capital liabilities, other operations-related assets and other investing-related assets, other operations-related liabilities and other financing-related liabilities. Because of reduced disclosures available for interim financial statements, certain line items on the quarterly balance sheet are combined.

A Cash Flow Analytics, LLC quarterly report designed to facilitate analysis that provides multiple partitions of the overall change in cash and cash equivalents and highlight sustainable and nonrecurring sources and uses of cash. The statement is a combination of the direct and indirect cash flow formats, showing the reconciliation of key items from the statement of income to their cash flow counterparts. Important subtotals on the cash flow analysis statement include Core operating cash flow, Sustainable operating cash flow, and Sustainable free cash flow. Because of reduced disclosures available for interim financial statements, certain line items on the quarterly cash flow analysis statement are combined.

Calculations supporting amounts reported on the quarterly cash flow analysis statement.

A Cash Flow Analytics, LLC report designed to show the results of profit-directed activities over a quarter with a particular emphasis on sources of sustainable income. The statement highlights the results of core operations, including revenue from core operations, gross profit from core operations and operating profit from core operations, and the results of non-core operations, including other income (expense) recurring and other income (expense) nonrecurring. Because of reduced disclosures available for interim financial statements, certain line items on the quarterly statement of income are combined.

Core operating cash flow divided by revenue

See Core Cash Growth Profile TM

Cash flow generated by core or central operations, before income taxes, other cash receipts and disbursements and before the payment of interest on borrowed funds. It is calculated as cash gross margin less cash operating expense.

Input data for Cash Flow Analytics, LLC forecast reports that relate to operating working capital assets and liabilities and determine a forecast cash cycle.

The percentage change in core operating cash flow from one period to the next.

The percentage change in core operating cash flow between the same quarter the previous year and the current quarter.

The capacity of a firm to generate core operating cash flow as it grows reflecting a combination of its operating cushion and operating working capital requirements, expressed as a percentage of revenue. It is measured as operating cushion % less operating working capital to revenue %. It is forward looking and reports the amount of core operating cash flow that can be expected for any measured amount of growth in revenue under the assumption that a firm's current mix of operating cushion and operating working capital remains unchanged. A firm with a positive operating growth profile™ can grow operations and produce increasing amounts of core operating cash flow. A firm with a negative operating growth profile™ will require other sources of cash to support revenue growth.

Cost incurred plus profit recognized in excess of amounts billed on contracts accounted for under percentage-of-completion accounting. Cost incurred plus profit recognized also equals revenue recognized on contracts. The account is similar to trade receivables and is often referred to as unbilled receivables. The account is typically classified as a current asset even though realization of amounts owed may not be collected for a period that extends beyond one year. On the cash flow analysis statement the account is used in computing change in operating receivables, a component of cash from revenue.

See also: Unbilled receivables

The cost of generating revenue from core operations, including the cost of goods sold and the cost of services provided. Depreciation and amortization expense, if any, are included. On the cash flow analysis statement the account is used in computing cost of revenue (excl. depreciation & amortization), a component of cash cost of revenue.

The cost of generating revenue from core operations, including the cost of goods sold and the cost of services provided, before the non-cash expenses of depreciation and amortization of productive capacity and before any non-cash provision for impairment of inventory.

The cost of generating revenue from core operations, including the cost of goods sold and the cost of services provided measured as a percentage of revenue from core operations. Depreciation and amortization expense, if any, are included in cost of revenue.

Performance measures focused on analyzing the extent to which various claims are covered by earnings and cash flow amounts available to meet them.

A measure of the sustainability of reported operating cash flow. It is computed as the ratio of sustainable operating cash flow to reported operating cash flow and is reported in percentage terms. The inclusion of nonoperating and/or nonrecurring cash flow items in reported operating cash flow will result in readings of CQI™ below 100. Sustainable operating cash flow will typically differ from reported operating cash flow due to various nonoperating and/or nonrecurring items. The Cash Flow Analysis Statement adjusts for approximately half of these items with entry of company-reported data from the statements of income and balance sheet. However, certain adjustments require additional manual data input. These adjustment items, found on the Statement of Income and Related Data Input spreadsheet, are labeled with an asterisk (*) and the letters (CF Adj). Note that with quarterly financial statements, data necessary for manual input are typically not available.

See also: CF Adj; Cash flow adjustment item

Any and all steps used to alter operating cash flow and, in the process, provide a more positive signal about a firm's sustainable cash-generating ability. Creative cash flow reporting may entail steps taken within the boundaries of GAAP, beyond those boundaries, or by the inclusion of nonrecurring amounts in operating cash flow.

See also: Opportunistic cash flow classifications

Abbreviation for Common Size Balance Sheet.

Abbreviation for Common Size Cash Flow Analysis Statement.

Abbreviation for Common Size Income Statement.

The cumulative prior-year income effect of a change from one generally accepted accounting principle to another.

Incurred operating costs or expenses that have not been paid and for which payment is due within one year or the operating cycle, whichever is longer. On the cash flow analysis statement the account is used in computing change in accruals, a component of cash operating expense.

See also: Accruals

The sum of all assets classified as current plus other operating working capital assets that may not be classified as current. Consists of cash and short-term investments, operating working capital assets, current tax-related assets, and other current assets.

The sum of all liabilities classified as current plus other operating working capital liabilities that may not be classified as current. Consists of operating working capital liabilities, current tax-related liabilities, current financing-related liabilities, and other current liabilities.

Cash and cash equivalents and assets expected to be converted to cash and cash equivalents or consumed within one year or the operating cycle, whichever is longer.

Current assets of business segment or separately-reported business unit that is scheduled for disposition. On the cash flow analysis statement the account is used in computing disposition of discontinued operations, a component of investment of sustainable free cash flow.

Expenditures that are reported as assets to be amortized against future revenue and that are to be expensed within one year or the operating cycle, whichever is longer. On the cash flow analysis statement the account is used in computing change in capitalized operating expenses, a component of cash operating expense.

See also: Capitalized operating expenses

Revenue that is collected in advance of being earned and is reported as a liability. Because it is classified as current, the revenue is expected to be earned within one year or the operating cycle, whichever is longer. Also referred to as unearned revenue, customer deposits, and for airlines, air traffic liability. For contractors, deferred revenue consists of amounts billed customers in excess of cost plus profit recognized. On the cash flow analysis statement the account is used in computing change in deferred revenue, a component of cash from revenue.

See also: Deferred revenue

Future tax benefits that result from (1) the origination of a deductible temporary difference, that is, a tax deduction that can be used in a future period, or (2) a loss or tax-credit carryover measured as a percentage of income before income taxes. The current classification arises from the fact that these deferred tax assets arise from balance-sheet items that are classified as current.

See also: Current deferred tax assets

Future tax obligations that result from the origination of taxable temporary differences measured as a percentage of income before income taxes. The current classification arises from the fact that these deferred tax liabilities arise from balance-sheet items that are classified as current.

See also: Current deferred tax liabilities

The balance sheet amount of financing-related obligations that are due within one year or the operating cycle, which ever is longer, consisting of interest payable, dividends payable, short-term debt and the current portion of long-term debt and capital lease obligations.

The income tax for the period based upon taxable income reported in the corporate tax return. In most cases this amount, with adjustments for changes in taxes payable and refundable, should approximate the income tax actually paid or recovered during the year.

Liabilities expected to be repaid or otherwise settled within one year or the operating cycle, whichever is longer.

Current liabilities of business segment or separately-reported business unit that is scheduled for disposition. On the cash flow analysis statement the account is used in computing disposition of discontinued operations, a component of investment of sustainable free cash flow.

Non-customer-related notes receivable due within one year or the operating cycle, whichever is longer. On the cash flow analysis statement the account is used in computing investment in notes receivable, a component of investment to support operations.

See also: Investment in notes receivable

Amounts due from customers or other operating-related transactions that is due within one year or the operating cycle, whichever is longer. On the cash flow analysis statement the account is used in computing change in operating receivables, a component of cash from revenue.

See also: Customer-related notes receivable

Principal on capital lease obligations that is due and payable within one year. On the annual and forecast annual cash flow analysis statement the opening balance in the account is reported as required principal payments on long-term debt and capital lease obligations, a component of financing transactions. On the quarterly cash flow analysis statement, required principal payments on long-term debt and capital lease obligations are included in long-term debt financing.

Principal on long-term debt that is due and payable within one year. On the annual and forecast annual cash flow analysis statement the opening balance in the account is reported as required principal payments on long-term debt and capital lease obligations, a component of financing transactions. On the quarterly cash flow analysis statement, required principal payments on long-term debt and capital lease obligations are included in long-term debt financing.

Principal on long-term debt and capital lease obligations that is due and payable within one year.

Costs or expenses that have been paid in advance of being incurred and that are expected to be consumed within one year or the operating cycle, whichever is longer. On the cash flow analysis statement the account is used in computing change in prepaids, a component of cash operating expense.

See also: Prepaids

The amount of current and operating working capital assets for every dollar of current and operating working capital liabilities. It is calculated as Current and operating working capital assets divided by current and operating working capital liabilities.

Tax-related assets generally expected to be realized within one year consisting of a tax refund receivable and current deferred tax assets.

Tax-related liabilities generally expected to be paid within one year consisting of income taxes payable and current deferred tax liabilities.

Amounts due vendors within one year or the operating cycle, whichever is longer, for purchases made that are represented by a more formal obligation than credit due on open account. On the cash flow analysis statement the account is used in computing change in operating payables, a component of cash cost of revenue.

See also: Operating payables

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An estimate of the principal amount due if minimum rent expense paid in the current period represented an expenditure made for principal and interest due on outstanding debt. It is calculated by discounting minimum rent expense for the current period at a discount rate of 12.5%.

The cost of issuing debt, including appraisal and recording fees, and commitment fees paid separately to a lender.

A security representing a debt relationship with an enterprise, including a government security, municipal security, corporate bond, convertible debt issue, and commercial paper. For accounting purposes, redeemable preferred stock is also considered to be a debt security.

The fourth and final stage of a company's life cycle during which revenue declines and earnings turn to losses. Depending on the amount of non-cash expenses reported, such as depreciation and amortization expense, operating cash flow may remain positive until very late in the decline stage.

Temporary differences that, upon their reversal, reduce taxable income. The initial tax effects of these temporary differences are recorded as deferred tax assets.

A title that is typically used to describe long-term prepaid expenses.

The amount of equity-based compensation that has not, as yet, been earned. It is reported as a reduction in shareholders' equity and is amortized to compensation expense as it is earned. On the cash flow analysis statement the account is used in computing common equity financing, a component of financing transactions.

Deferred revenue measured in terms of revenue from core operations per day. Calculated as deferred revenue divided by revenue from core operations measured on a daily basis using a 365-day year.

See also: Deferred revenue days

Deferred revenue measured in terms of revenue from core operations per day. Calculated as deferred revenue divided by revenue from core operations measured on a daily basis using a 365-day year.

See also: Deferred revenue (in revenue days)

Deferred revenue as a percentage of revenue from core operations. In effect, the proportion of revenue from core operations that has been collected in advance as of the end of a reporting period.

A contra-asset account established when it is judged probable that some or all of a deferred tax asset balance will not be realized. A probability threshold of 50% is used in making this assessment. A valuation allowance is set off against deferred tax assets that have a probability of not being realized that exceeds 50%.

Deferred tax assets as a percentage of annualized income before income taxes. In effect, the proportion of income before income taxes carried in future tax benefits as of the end of a reporting period.

See also: Deferred tax assets

Deferred tax assets as a percentage of income before income taxes. In effect, the proportion of income before income taxes carried in future tax benefits as of the end of a reporting period.

See also: Deferred tax assets

Deferred tax liabilities as a percentage of annualized income before income taxes. In effect, the proportion of income before income taxes carried in future tax obligations as of the end of a reporting period.

See also: Deferred tax liabilities

Deferred tax liabilities as a percentage of income before income taxes. In effect, the proportion of income before income taxes carried in future tax obligations as of the end of a reporting period.

See also: Deferred tax liabilities

The cumulative amount of any deferred tax liability arising from the amortization of goodwill for income tax purposes. Goodwill arising from certain asset acquisitions is amortizable for tax purposes over a fifteen-year amortization period. The resulting tax deduction creates a temporary difference between book income and taxable income and a reduction in taxes due and payable for that period. This is a cash flow adjustment item. It is disclosed in the notes to the financial statements. On the cash flow analysis statement adjustments are made to income taxes (paid) recovered on continuing operations and to investments in goodwill and acquisition-related intangibles for changes in the deferred tax liability from tax-related goodwill amortization.

The income tax provision or benefit that is based upon the tax effects of the change during the period in cumulative temporary differences.

The non-cash component of income tax expense represented by the change in deferred tax assets and deferred tax liabilities as carried on the company-reported indirect method statement of cash flows.

Depreciation and amortization expense calculated on PP&E and other operations-related assets and intangibles that is included either in cost of revenue or selling, general and administrative expense.

Non-cash depreciation and amortization expense calculated on PP&E and other operations-related assets and intangibles that is included as part of cost of revenue measured as a percentage of revenue from core operations.

See also: Depreciation incl. in cost of revenue

Non-cash depreciation and amortization expense calculated on PP&E and other operations-related assets and intangibles that is included as part of selling, general and administrative expense measured as a % of revenue from core operations.

See also: Amortization incl. in SG&A

The periodic amount of depreciation expense calculated on property, plant and equipment.

Income from operations and the gain or loss on disposal of a discontinued business segment or separately measured business unit. It is reported after income tax effects have been subtracted.

See also: Discontinued operations gain (loss)

Income from operations and the gain or loss on disposal of a discontinued business segment or separately measured business unit. It is reported after income tax effects have been subtracted. On the cash flow statement (indirect method) the account balance is removed from net income (loss) in computing income (loss) from continuing operations.

See also: Discontinued operations

Income from operations and the gain or loss on disposal of a discontinued business segment or separately measured business unit. It is reported after income tax effects have been subtracted. On the cash flow analysis statement the account is used in computing disposition of discontinued operations, a component of investment of sustainable free cash flow.

See also: Discontinued operations

Cash flow related to discontinued operations including the change in net assets related to discontinued operations and any income or loss from a discontinued segment plus any gain or less any loss on disposition. Included as part of investment of sustainable free cash flow.

Dividends received from investee companies in which the investor has sufficient ownership to exert significant influence.

Dividends declared on investments in common or preferred stock that are not accounted for using the equity method. On the cash flow analysis statement the account is used in computing other recurring cash receipts (disbursements), a component of cash flow available for debt service.

The proportion of sustainable earnings, earnings adjusted to exclude known items of nonrecurring revenue, gain, expense and loss, that are paid out in dividends on common stock.

Dividends paid in cash on preferred stock.

The dollar amount of dividends declared on common stock during the reporting period. On the cash flow analysis statement the account is used in computing dividends on common stock, a component of financing transactions.

The dollar amount of dividends declared on preferred stock during the reporting period. On the cash flow analysis statement the account is used in computing dividends - preferred, a component of cash flow available for investment.

Cash payments for dividends on common stock. Calculated as dividends declared on common stock adjusted for any change in dividends payable and any dividends paid with shares of common stock.

Quarterly, year-to-date dividends paid on common stock. In the absence of a quarterly statement detailing activity in retained earnings, including dividends declared on common stock, dividends paid on common stock can be used as an accurate approximation to dividends declared on common stock and should be available on the statement of cash flows.

Dividends paid in cash on preferred stock measured as a percentage of average outstanding preferred stock.

Dividends paid in cash on preferred stock.

Dividends paid in cash on preferred stock measured as a percentage of cash flow available for investment.

The dollar amount of cash dividends paid on preferred stock during the current quarter.

Quarterly, year-to-date dividends paid on preferred stock. In the absence of a quarterly statement detailing activity in retained earnings, including dividends declared on preferred stock, dividends paid on preferred stock, if any, can be used as an accurate approximation to dividends declared on preferred stock. The necessary information may be available on the statement of cash flows. Though dividends on preferred stock paid in cash (YTD) may need to be estimated using the amount of outstanding preferred stock and the dividend payment rate.

Dividends declared on stock that are due and payable. On the cash flow analysis statement the account is used in computing dividends on common stock, a component of financing transactions.

Cash distributions received from investments accounted for under the equity method. On the cash flow analysis statement the account is used in computing other recurring cash receipts (disbursements), a component of cash flow available for debt service, and in computing unremitted equity method income (loss), a component of long-term investments and of investment of sustainable free cash flow.

Quarterly, year-to-date cash distributions received from investments accounted for under the equity method. On the cash flow analysis statement the account is used in computing other recurring cash receipts (disbursements), a component of cash flow available for debt service, and in computing unremitted equity method income (loss), a component of long-term investments and of investment of sustainable free cash flow.

The factors that drive or result in increases or decreases in capital expenditures. An understanding of the drivers of capital expenditures facilitates the formation of expectations regarding cash flow sustainability

The factors that drive or result in increases or decreases in core operating cash flow. An understanding of cash flow drivers facilitates the formation of expectations regarding cash flow sustainability.

The factors that drive or result in increases or decreases in income taxes paid. An understanding of the drivers of income taxes paid facilitates the formation of expectations regarding cash flow sustainability.

The factors that drive or result in increases or decreases in Sustainable free cash flow. An understanding of cash flow drivers facilitates the formation of expectations regarding cash flow sustainability.

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Earnings measured before depreciation and amortization. May be considered as earnings available for the required payment of principal on debt.

Net income measured before interest expense and before income tax expense.

Earnings measured before interest expense, depreciation and amortization. May be considered as earnings available for the payment of interest and required principal on debt.

An earnings-based measure that often serves as a surrogate for cash flow. The measure actually represents working capital provided by operations before interest and taxes.

EBITDA measured before rent expense on operating leases. May be considered as earnings available for the payment of interest, taxes and rents.

A five point score measuring three dimensions of earnings quality: sustainable earnings, sustainable cash flow and balance sheet quality. The three dimensions are measured with five factors. Sustainable earnings are measured with sustainable net margin and incremental net margin. Sustainable cash flow is measured with sustainable free cash margin and the one-year change in sustainable free cash margin. Balance sheet quality is measured with the three-year rate of change in total assets days. For each firm, scores on the five factors are compared with the firm's industry median. For measures that outperform the industry median, a score of 1 is assigned. For measures that underperform the industry median, a score of 0 is assigned. The overall earnings quality score is then computed by summing the measures for the five individual factors. An Earnings Quality score of 0 or 1 is an indication of poor earnings quality. The firm is significantly underperforming its industry benchmark. An Earnings Quality score of 4 or 5 is an indication of good earnings quality. The firm is significantly outperforming its industry benchmark. An Earnings Quality score of 2 or 3 is an indication of earnings quality caution.

A measure of the extent to which reported income from continuing operations differs from earnings that come from sustainable sources, expressed as a percent of revenue from core operations. A negative amount indicates that reported income from continuing operations exceeds sustainable earnings. A positive amount indicates that sustainable earnings exceed reported income from continuing operations. The ratio is calculated as sustainable earnings less reported income (loss) from continuing operations all divided by revenue. Sustainable earnings are earnings adjusted to exclude known items of nonrecurring revenue, gain, expense and loss.

The amount of earnings before depreciation and amortization expense. It is calculated by adding to after-tax sustainable earnings, depreciation and amortization included in cost of revenue, and depreciation and amortization included in selling, general and administrative expense. It is used as an earnings-based measure of debt-service capacity, to measure the extent to which sustainable earnings, adjusted to remove the non-cash expenses of depreciation and amortization, is sufficient to cover the claims of required principal payments on outstanding borrowings.

A coverage ratio that measures the number of times that earnings before depreciation and amortization expense covers required principal payments on long-term debt and capital lease obligations.

The percentage change in EBDA from one period to the next.

The amount of earnings before interest expense, depreciation and amortization expense. It is calculated by adding to after-tax sustainable earnings, interest expense, depreciation and amortization included in cost of revenue, and depreciation and amortization included in selling, general and administrative expense. It is used as an earnings-based measure of debt-service capacity, to measure the extent to which sustainable earnings, adjusted to remove the non-cash expenses of depreciation and amortization, is sufficient to cover the claims of interest expense and required principal payments on outstanding borrowings.

A coverage ratio that measures the number of times that earnings before interest expense, depreciation and amortization expense covers interest paid and required principal payments on long-term debt and capital lease obligations.

The percentage change in EBIDA from one period to the next.

The amount of earnings before interest expense, tax expense, depreciation and amortization expense. It is calculated by adding to pre-tax sustainable earnings, interest expense, depreciation and amortization included in cost of revenue, and depreciation and amortization included in selling, general and administrative expense. It is used as an earnings-based measure of debt-service capacity, to measure the extent to which sustainable pre-tax earnings, adjusted to remove the non-cash expenses of depreciation and amortization, is sufficient to cover the claims of interest expense.

The percentage change in EBITDA from one period to the next.

A coverage ratio that measures the number of times that earnings before interest expense, tax expense, depreciation and amortization expense covers taxes paid and interest paid.

A coverage ratio that measures the number of times that earnings before interest expense, tax expense, depreciation and amortization expense covers interest paid.

The amount of earnings before interest expense, tax expense, depreciation, amortization and rent expense. It is calculated by adding to pre-tax sustainable earnings, interest expense, depreciation and amortization included in cost of revenue, depreciation and amortization included in selling, general and administrative expense, and minimum rent expense on operating leases. It is used as an earnings-based measure of debt-service capacity, to measure the extent to which sustainable pre-tax earnings, adjusted to remove the non-cash expenses of depreciation and amortization, is sufficient to cover the claims of interest and rent expense.

A coverage ratio that measures the number of times that earnings before interest expense, tax expense, depreciation, amortization and rent expense covers interest paid and rent expense.

A coverage ratio that measures the number of times that earnings before interest expense, tax expense, depreciation, amortization and rent expense covers taxes paid, interest paid and rent expense.

The percentage change in EBITDAR from one period to the next.

Company reported effects of changes in exchange rates on foreign currency cash and cash equivalents balances. In accordance with generally accepted accounting principles, such exchange rate effects are not labeled as operating, investing or financing cash flow.

The income tax provision on continuing operations divided by income from continuing operations before income taxes. It measures the proportion of pre-tax income that results in total tax expense.

See also: Effective tax-rate expense (benefit) %

For quarterly financial statements, the effective tax rate divided by the prior-year marginal tax rate. It measures the effects of steps taken to minimize the effective tax rate and indicates a potential impact on earnings of a change in the effective tax rate toward the marginal tax rate.

The effective tax rate divided by the marginal tax rate. It measures the effects of steps taken to minimize the effective tax rate and indicates a potential impact on earnings of a change in the effective tax rate toward the marginal tax rate.

The income tax provision divided by income before income taxes. It measures the proportion of pre-tax income that results in total tax expense.

See also: Effective tax rate

A summary of the measured effects of changes in tax cash-flow drivers on income tax related accounts from one period to the next.

Company reported effects of changes in exchange rates on foreign currency cash and cash equivalents balances. In accordance with generally accepted accounting principles, such exchange rate effects are not labeled as operating, investing or financing cash flow.

A summary of the measured effects of growth in income before income taxes on income tax related accounts from one period to the next.

For quarterly financial statements, the earnings impact on income from continuing operations of the change in the effective tax rate from the same quarter the previous year.

For quarterly financial statements, the earnings impact on income from continuing operations of the change in gross margin % from the same quarter the previous year.

For quarterly financial statements, the earnings impact on income from continuing operations of the change in R&D expense / Revenue from core operations from the same quarter the previous year.

For quarterly financial statements, the earnings impact on income from continuing operations of the change in SG&A expense / Revenue from core operations from the same quarter the previous year.

The EITF assists the FASB through the timely identification, discussion, and resolution of financial accounting issues based upon existing authoritative literature.

Also referred to as Excess Cash Margin (ECM). It is an interpretive ratio used to measure the relationship between sustainable operating cash flow and net income. The ratio measures the excess of sustainable operating cash flow over net income as a percentage of revenue. More specifically, it is calculated as ((Sustainable operating cash flow - Net income) / Revenue) X 100). Significant decreases in the ratio over time are of particular concern and indicate that sustainable operating cash flow is growing slower or declining faster than net income, leading to a build-up of non-cash balance sheet accounts and warning of possible operational difficulties or of aggressive practices in the measurement of earnings. Future earnings may be at risk for decline. Significant increases in the ratio over time indicate that sustainable operating cash flow is growing faster or declining slower than net income, leading to a decline in non-cash balance sheet accounts. Such a development suggests either the possibility of increasingly conservative accounting practices in the measurement of earnings or of a decline in future sustainable operating cash flow. A steady to slightly increasing ratio over time indicates an equilibrium relationship between sustainable operating cash flow and net income. Before net income is used in the calculation of EQI™ it should be adjusted for known nonrecurring items of revenue, gain, expense or loss. Such adjustments remove noise and improve the effectiveness of EQI™. Net income adjusted for nonrecurring items is referred to as sustainable earnings.

See also: Excess Cash Margin (ECM)

The investor's share of an equity-accounted investee's net loss or net earnings as carried on the company-reported indirect method statement of cash flows.

The investor's share of net income (net loss) generated by an investment accounted for using the equity method. On the cash flow analysis statement the account is used in computing unremitted equity method income (loss), which is used in computing long-term investments, a component of investment of sustainable free cash flow.

Investments in common or preferred stock with voting interests that provide the holder with an ownership interest that is sufficient to exert significant influence over the investee. The investor's share of income or loss is recorded and also serves to increase or reduce, respectively, the investment balance. Dividends received are accounted for as a return of investment and reduce the investment balance.

An ownership interest in an enterprise, including preferred and common stock.

Income from operations and the gain or loss on disposal of a discontinued business segment or separately measured business unit. It is reported after income tax effects have been subtracted. On the cash flow statement (indirect method) the account balance is removed from net income (loss) in computing Income (loss) from continuing operations.

See also: Discontinued operations

Gain or loss that is unusual and infrequent in occurrence. It is reported after income tax effects have been subtracted. On the cash flow analysis statement the account is used in computing other nonrecurring cash receipts (disbursements), a component of investment of sustainable free cash flow.

See also: Extraordinary item

Gain or loss that is unusual and infrequent in occurrence. It is reported after income tax effects have been subtracted.

See also: Extraordinary gain (loss)

A combined measure of a gain or loss that is unusual and infrequent in occurrence together with income from operations and the gain or loss on disposal of a discontinued business segment or separately measured business unit.

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Abbreviation for Forecast Balance Sheet.

Abbreviation for Forecast Cash Flow Analysis Statement.

Abbreviation for Forecast Cash Flow Drivers Report.

Abbreviation for Forecast Financial Performance Report.

Abbreviation for Forecast Statement of Income.

The sale of accounts receivable, typically without recourse, to a financial institution that collects the underlying accounts directly from the seller company's customers.

See also: Cash provided or used by financing activities

The sum of all cash flow related to external financing transactions.

A loan arrangement that is typically used to finance durable goods inventory such as automobiles, mobile homes, recreational vehicles, boats and motorcycles, where the underlying inventory is pledged as loan security. Any outstanding loan balance is linked directly to inventory levels, increasing as inventory levels increase and requiring repayment as inventory levels decline.

Sources of data for input to Cash Flow Analytics, LLC reports that come primarily from the footnotes to the financial statements.

The forecast, based on forecast assumptions in amortization expense on acquisition-related intangibles.

The average principal amount during a forecast period on short-term and long-term debt and capital lease obligations on which interest accrues. Calculated by dividing two into the sum of the beginning forecast balance plus ending forecast balance of all interest-bearing borrowings.

The forecast, based on forecast assumptions, in capitalized debt issue costs.

The forecast, based on forecast assumptions, in the restructuring and merger-related reserve.

The forecast, based on forecast assumptions, in short-term borrowings.

The forecast, based on forecast assumptions, in short-term debt.

A Cash Flow Analytics, LLC forecast report designed to report a firm's financial position as of a point in time with particular emphasis on assets and liabilities that are central to a firm's cash flow generations, including operating working capital asset and operating working capital liabilities, other operations-related assets and other investing-related assets, other operations-related liabilities and other financing-related liabilities. The forecast report provides the analyst with reporting flexibility designed to facilitate measurement of the sensitivity of selected balance sheet measures to changes in underlying assumptions concerning such fundamental factors as growth, profitability and efficiency.

A Cash Flow Analytics, LLC forecast report designed to facilitate analysis that provides multiple partitions of the overall change in cash and cash equivalents and highlight sustainable and nonrecurring sources and uses of cash. The statement is a combination of the direct and indirect cash flow formats, showing the reconciliation of key items from the statement of income to their cash flow counterparts. Important subtotals on the cash flow analysis statement include Core operating cash flow, Sustainable operating cash flow, and Sustainable free cash flow. The forecast report provides the analyst with reporting flexibility designed to facilitate measurement of the sensitivity of selected cash flow measures to changes in underlying assumptions concerning such fundamental factors as growth, profitability and efficiency.

A Cash Flow Analytics, LLC forecast report designed to highlight the factors driving core operating cash flow, sustainable operating cash flow, and sustainable free cash flow higher or lower over time so that sustainability of those measures can better be assessed and expectations can be formed regarding a firm's ability to continue generating them. The forecast report provides the analyst with reporting flexibility designed to facilitate measurement of the sensitivity of selected cash flow measures to changes in underlying assumptions concerning such fundamental factors as growth, profitability and efficiency.

A Cash Flow Analytics, LLC forecast report designed to highlight key measures of financial performance separated into the categories of growth, profitability, activity, cash-flow profile, liquidity, leverage, coverage, dilution and valuation. The forecast report provides the analyst with reporting flexibility designed to facilitate measurement of the sensitivity of selected performance measures to changes in underlying assumptions concerning such fundamental factors as growth, profitability and efficiency.

Forecast amounts for short-term and long-term debt and capital lease obligations on which interest accrues.

A Cash Flow Analytics, LLC forecast report designed to show the results of profit-directed activities over a reporting period with a particular emphasis on sources of sustainable income. The statement highlights the results of core operations, including revenue from core operations, gross profit from core operations and operating profit from core operations, and the results of non-core operations, including other income (expense) recurring and other income (expense) nonrecurring. The forecast report provides the analyst with reporting flexibility designed to facilitate measurement of the sensitivity of selected performance measures to changes in underlying assumptions concerning such fundamental factors as growth and profitability.

Standardized and custom Cash Flow Analytics, LLC financial report formats designed to use annual forecast data.

Foreign currency transaction gains (losses) on translating foreign currency transaction balances into a reporting currency. Also includes translation adjustments arising from the application of the monetary/nonmonetary method of translating foreign currency financial statements. On the cash flow statement (indirect method), the account balance is removed from Income (loss) from continuing operations in the computation of sustainable operating cash flow.

Foreign currency transaction gains (losses) on translating foreign currency transaction balances into a reporting currency. Also includes translation adjustments arising from the application of the monetary/nonmonetary method of translating foreign currency financial statements. On the cash flow analysis statement the account is used in computing other nonrecurring cash receipts (disbursements), a component of investments of sustainable free cash flow.

The factors that drive or result in increases or decreases in core operating cash flow, sustainable operating cash flow and sustainable free cash flow over time measured here for a four-quarters ending reporting period. An understanding of cash flow drivers facilitates the formation of expectations regarding cash flow sustainability.

The cash flow growth profile measured for a four-quarters ending reporting period.

Miscellaneous measures of performance measured for a four-quarters ending reporting period.

Performance measures focused on analyzing the results of income-directed activity, measured here for a four-quarters ending reporting period.

Data that reflects four quarters, that is, a full year's worth of income or cash flow results, through the indicated quarter. For example, four quarters ending data for September 30, 2007 reflects results for the quarters ending December 31, 2006, March 31, 2007, June 30, 2007 and September 30, 2007. Also known as "Trailing Twelve Months" or "TTM" data.

Cash flow available for common shareholders that can be used for such discretionary purposes as stock buybacks and dividends without affecting the firm's ability to grow and generate more. Calculated as operating cash flow less preferred dividends, net capital expenditures and other long-term assets needed to support operations.

See also: Sustainable free cash flow

The percentage of revenue from core operations that results in sustainable free cash flow. It is driven by the determinants of operating cash margin, the payment of preferred dividends, net capital expenditures and other long-term assets needed to support operations.

See also: FCM™ Free cash margin™

See Free Cash Growth Profile TM

The Stochastic (STC) oscillator, developed by George Lane, is a momentum indicator that compares the price of a security relative to the trading (high/low) range over a period of time. Closing levels that are consistently at the top of the range indicate accumulation of the security (buying pressure), whereas closing levels near the bottom of the range suggests distribution (selling pressure).

The Full Stochastic Oscillator takes three parameters. The first and last parameters are identical to the Fast and Slow versions. The first is the number of periods used to calculate the %K line and the last is the number of periods used to create the %D signal line. The difference is the second parameter, which is used as a smoothing factor of the %K line. With the smoothing factor, this Stochastic is thus more flexible for analysis.

Traditionally defined as working capital, i.e., the excess of current assets over current liabilities.

A term used by real estate investment trusts (REITs) and defined as net income or loss excluding gains or losses from debt restructuring and sales of property, plus depreciation and amortization of real estate assets.

Unidentified sources or (uses) of working capital generated by operations as carried on the company-reported indirect method statement of cash flows.

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Cash flow from operating activities computed in accordance with generally accepted accounting principles.

See also: Reported operating cash flow

Any realized gain or loss arising from the sale of intangible assets. It is measured as the difference between the net proceeds from sale and the asset's balance sheet carrying value on the date of sale. Because goodwill cannot be disposed of separately from the disposal of a company, this category includes any gain or loss on sale of a company not considered to be discontinued operations. A gain or loss on discontinued operations should be reported in that caption. On the cash flow analysis statement the account is used in computing investments in goodwill and acquisition-related intangibles, a component of investment of sustainable free cash flow.

Any realized gain or loss arising from the sale of investments. It is measured as the difference between the net proceeds from sale and the asset's balance sheet carrying value on the date of sale. On the cash flow analysis statement the account is used in computing long-term investments, a component of investment of sustainable free cash flow.

Any realized gain or loss arising from the disposal of assets that cannot be classified elsewhere. It is measured as the difference between the net proceeds from sale and the asset's balance sheet carrying value on the date of sale. On the cash flow analysis statement the account is used in computing investments in other assets, a component of investment of sustainable free cash flow.

The excess (shortage) of the proceeds received from the sale of a PP&E item relative to its book value. Combining the decrease in the book value of an item of PP&E that has been disposed of with the gain or (loss) on sale yields the proceeds from sale of PP&E. These proceeds from sale of PP&E are included as a source of cash in computing capital expenditures.

Any realized gain or loss arising from the sale of intangible assets. It is measured as the difference between the net proceeds from sale and the asset's balance sheet carrying value on the date of sale. Because goodwill cannot be disposed of separately from the disposal of a company, this category includes any gain or loss on sale of a company not considered to be discontinued operations. A gain or loss on discontinued operations should be reported in that caption. On the cash flow statement (indirect method), the account balance is removed from Income (loss) from continuing operations in the computation of sustainable operating cash flow.

Any realized gain or loss arising from the disposal of assets that cannot be classified elsewhere. It is measured as the difference between the net proceeds from sale and the asset's balance sheet carrying value on the date of sale. On the cash flow statement (indirect method), the account balance is removed from Income (loss) from continuing operations in the computation of sustainable operating cash flow.

Any realized gain or loss arising from the sale of investments. It is measured as the difference between the net proceeds from sale and the asset's balance sheet carrying value on the date of sale. On the cash flow statement (indirect method), the account balance is removed from Income (loss) from continuing operations in the computation of sustainable operating cash flow.

The excess or shortage of the proceeds received from the sale of a PP&E item relative to its book value. On the cash flow statement (indirect method) the account balance is removed from Income (loss) from continuing operations in the computation of sustainable operating cash flow.

The excess (shortage) of the proceeds received from the sale of various assets, including PP&E, investments, other investing-related assets, and goodwill and intangibles, relative to book value.

A common set of standards and procedures for the preparation of general-purpose financial statements that either have been established by an authoritative accounting rule-making body, such as the Financial Accounting Standards Board (FASB), or have over time become common accepted practice.

An intangible asset representing the amount paid in the acquisition of either significant influence or control of an entity over the fair value of the acquired entity's identifiable net assets. Goodwill is carried without amortization but is reviewed for impairment at least annually.

Goodwill and other intangible assets, net of accumulated amortization, if any, arising as a result of amounts paid in an acquisition in excess of the fair value of identifiable net assets.  Examples of non-goodwill acquisition-related intagibles include patents, trademarks, brands, customer lists and non-compete agreements. 

The balance in goodwill and acquisition-related intangibles that were not used in the calculations.

Goodwill and other intangible assets, net of accumulated amortization, if any, arising as a result of amounts paid in an acquisition in excess of the fair value of identifiable net assets. Examples of non-goodwill acquisition-related intangibles include patents, trademarks, brands, customer lists and non-compete agreements.

Goodwill and other intangible assets, reported before subtracting accumulated amortization, if any, arising as a result of amounts paid in an acquisition in excess of the fair value of identifiable net assets.  Examples of non-goodwill acquisition-related intangibles include patents, trademarks, brands, customer lists and non-compete agreements. 

An intangible asset representing the amount paid in the acquisition of either significant influence or control of an entity over the fair value of the acquired entity's identifiable net assets, less any accumulated amounts of amortization from prior-periods or writedowns for impairment. Goodwill is now carried without amortization but is reviewed for impairment at least annually. On the cash flow analysis statement the account is used in computing investments in goodwill and acquisition-related intangibles, a component of investment of sustainable free cash flow.

Capital expenditures before subtraction for the proceeds derived from the disposal of productive assets.

Revenue from core operations minus cost of revenue.

See also: Gross margin

The percentage change in a reported item from one period to the next calculated as the current period amount minus the amount for the same quarter the previous year all divided by the prior year amount.

The percentage change in a reported item from one period to the next calculated as the current period amount minus the prior period amount all divided by the prior period amount.

The measured effects of growth in income before income taxes on the change in deferred tax assets from one period to the next.

The measured effects of growth in income before income taxes on the change in deferred tax liabilities from one period to the next.

The measured effects of growth in income before income taxes on the change in income tax (expense) benefit from one period to the next.

The measured effects of growth in income before income taxes on the change in income taxes payable from one period to the next.

The measured effects of growth in income before income taxes on the change in tax refund receivable from one period to the next.

The second period in a company's life cycle during which operating earnings turn positive and revenue increases faster than the rate of growth in the overall economy. Operating cash flow may be negative during the early part of the growth stage of a company's life cycle and turn positive as the firm becomes more established.

Capital expenditures required to replace productive capacity consumed during a reporting period and to add infrastructure needed to maintain revenue growth. It is computed as capital expenditures net of cash received for dispositions of property, plant and equipment less the depreciation proxy for replacement capital expenditures.

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A debt security for which the investing entity has both the positive intent and ability to hold until maturity.

Supporting calculations for amounts reported on the Historical balance sheet.

Calculations supporting amounts reported on the Historical ratios report.

Supporting calculations for amounts reported on the Historical statement of operations or income statement.

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A summary of the effects of acquisitions and other undisclosed transactions, including, for example, the effects of foreign currency fluctuations on selected cash flow calculations.

A special charge taken to expense in order to write down the balance sheet carrying value of goodwill and intangibles that have become value impaired. On the cash flow analysis statement the account is used in computing investments in goodwill and acquisition-related intangibles a component of investment of sustainable free cash flow.

A special charge taken to expense in order to write down the balance sheet carrying value of investments that have become value impaired. On the cash flow analysis statement the account is used in computing long-term investments, a component of investment of sustainable free cash flow.

A special charge taken to expense in order to write down the balance sheet carrying value of PP&E that has become value impaired. On the cash flow analysis statement the account is used in computing capital expenditures, a component of investment of investment to support operations.

Changes in retained earnings resulting from transactions not accounted for elsewhere. On the cash flow analysis statement the account is used in computing other equity-related financing, a component of financing transactions.

Changes in retained earnings resulting from stock repurchases not accounted for as treasury stock and for the effects of conversions of convertible securities. On the cash flow analysis statement the account is used in computing common equity financing, a component of financing transactions.

Change in retained earnings resulting from stock repurchases not accounted for as treasury stock, for the effects of conversions of convertible securities and for other transactions not accounted for elsewhere, such as the effects of a prior-period adjustment.

Income from continuing operations measured before discontinued operations, extraordinary items and the cumulative effect of changes in accounting principles and before the provision for income taxes. It is a subtotal that is automatically calculated by the model.

After-tax net income before discontinued operations, extraordinary items and the cumulative effect of changes in accounting principle per average diluted common shares outstanding during the period. A calculated amount measured by subtracting income tax expense (benefit) from income (loss) before income taxes and dividing the difference by average diluted common shares outstanding during the period.

After-tax net income before discontinued operations, extraordinary items and the cumulative effect of changes in accounting principle.

See also: Net income (loss) from continuing operations

Income from continuing operations measured before discontinued operations, extraordinary items and the cumulative effect of changes in accounting principles and before the provision for income taxes.

The percentage change in income (loss) from continuing operations from one period to the next.

After-tax net income before discontinued operations and extraordinary items carried on the company-reported indirect method statement of cash flows.

The total (provision) benefit for income taxes measured on income from continuing operations before income taxes. On a statement of income, an income tax (benefit) is typically presented as a bracketed amount. However, for purposes of cash flow calculations, an income tax benefit is a source of cash and is presented without brackets. On the cash flow analysis statement the account is used in computing income taxes (paid) recovered on continuing operations, a component of cash flow available for debt service. Thus, as a use of cash, income tax (expense) is presented as a bracketed amount.

See also: Income tax expense (benefit)

All tax-related accounts used in the calculation of income taxes (paid) recovered on continuing operations.

The measured effects of changes in the tax cash-flow profile on income taxes (paid) recovered. It is calculated as the sum of the income tax cash impact of the change in the effective tax rate, of the change in deferred tax assets to income before income taxes, of the change in deferred tax liabilities to income before income taxes, of the change in tax refund receivable to income before income taxes, and the change in income taxes payable to income before income taxes.

The sum of the measured effects of growth in income before income taxes on income taxes (paid) recovered plus the measured effects of the change in the tax cash-flow profile on income taxes (paid) recovered.

The measured effects of growth in income before income taxes on income taxes (paid) recovered. It is calculated as the sum of the income tax cash impact of growth in income before income taxes on the change in income tax (expense) benefit, on the change in deferred tax assets, on the change in deferred tax liabilities, on the change in tax refund receivable and on the change in income taxes payable.

The drivers underlying income taxes paid as a % of income before income taxes. These drivers consist of the effective tax rate expense (benefit) %, the deferred tax assets to income before income taxes %, the deferred tax liabilities to income before income taxes %, the tax refund receivable to income before income taxes %, and the income taxes payable to income before income taxes %.

A summary of the measured effects of growth and changes in income tax cash flow drivers on income tax related accounts from one period to the next.

The total provision (benefit) for income taxes measured on income from continuing operations before income taxes. On a statement of income, an income tax (benefit) is typically presented as a bracketed amount. However, for purposes of cash flow calculations, an income tax benefit is a source of cash and is presented without brackets. On the cash flow analysis statement the account is used in computing income taxes (paid) recovered on continuing operations, a component of cash flow available for debt service. Thus, as a use of cash, income tax (expense) is presented as a bracketed amount.

See also: Income tax (expense) benefit

Income tax expense as computed on income before taxes and reported on the income statement.

Income tax expense on a measure of pre-tax income calculated using the effective income tax rate.

Income tax expense on a measure of pre-tax income calculated using the marginal income tax rate, or the rate applicable to the last amount of pre-tax income earned.

A tax refund due from a taxing authority for income taxes paid in excess of amounts currently payable or as the result of the utilization of an operating loss or tax credit carryback.

See also: Tax refund receivable

Actual cash disbursements or receipts arising from income taxes incurred on income from continuing operations. Measured as the income tax provision on income from continuing operations adjusted for changes in deferred tax assets, deferred tax liabilities, income tax refunds receivable and income taxes payable. It is measured before any tax benefits from stock options exercised, which are considered to be more of a financing cash flow.

See also: Income taxes (paid) recovered on continuing operations

The amount of income taxes (paid) or recovered through carryback calculated before any manual adjustment for taxes related to investing or financing activities.

Income taxes (paid) recovered calculated using as-reported amounts of income tax expense (benefit) and changes in tax-related balance sheet accounts. Income taxes (due) or recovered on material gains or losses can result in misleading tax payment amounts. As a result, adjustments are made for such taxes, removing them from operating cash flow and transferring their amounts to other nonrecurring cash receipts (disbursements).

See also: Adjustment for income taxes paid (recovered) on material non-operating gains or losses

Income taxes (paid) recovered on continuing operations after any tax benefits from stock options have been subtracted.

Actual cash disbursements or receipts arising from income taxes incurred on income from continuing operations. Measured as the income tax provision on income from continuing operations adjusted for changes in deferred tax assets, deferred tax liabilities, income tax refunds receivable and income taxes payable. It is measured before any tax benefits from stock options exercised, which are considered to be more of a financing cash flow.

See also: Tax benefits from stock options exercised

The change in income taxes payable as carried on the company-reported indirect method statement of cash flows.

The dollar amount of income taxes paid on material investing-related or financing-related gains or the dollar amount of income taxes (recovered) or (saved) on material investing-related or financing-related losses. This is a cash flow adjustment item. Note that amounts paid are entered without brackets, amounts (recovered) are entered with brackets. The tax amount must be gleaned from the income tax footnote to the financial statements and by a careful examination of income taxes paid during the period. An example is taxes paid on a gain arising from the sale of an investment or a company. Another example is taxes saved as a result of a loss on the early termination of debt. On the cash flow analysis statement the account is used in computing income taxes (paid) recovered on continuing operations, a component of cash flow available for debt service and in computing other nonrecurring cash receipts (disbursements), a component of investment of sustainable free cash flow.

The quarterly, year-to-date dollar amount of income taxes paid on material investing-related or financing-related gains or the dollar amount of income taxes (recovered) or (saved) on material investing-related or financing-related losses. This is a cash flow adjustment item for which necessary data may not be available in quarterly financial statements. Note that amounts paid are entered without brackets, amounts (recovered) are entered with brackets. The tax amount must be gleaned from the income tax footnote to the financial statements and by a careful examination of income taxes paid during the period. An example is taxes paid on a gain arising from the sale of an investment or a company. Another example is taxes saved as a result of a loss on the early termination of debt. On the cash flow analysis statement the account is used in computing income taxes (paid) recovered on continuing operations, a component of cash flow available for debt service and in computing other nonrecurring cash receipts (disbursements), a component of investment of sustainable free cash flow.

The percentage computed by dividing cash payments for income taxes after adjustment for income taxes paid (recovered) on material non-operating gains or losses by income from continuing operations before income taxes. Cash payments of income taxes are volatile and can affect sustainable operating cash flow and sustainable free cash flow. Changes in income taxes paid as a % of income before income taxes measure the effects of changes in tax payments relative to income before income taxes on sustainable operating cash flow and sustainable free cash flow. In this calculation, income taxes paid are not reduced for tax benefits from stock options exercised.

See also: Income taxes paid to revenue %

The percentage computed by dividing cash payments for income taxes after adjustment for income taxes paid (recovered) on material non-operating gains or losses by revenue from core operations. Cash payments of income taxes are volatile and can affect sustainable operating cash flow and sustainable free cash flow. In computing income taxes paid to revenue %, the direct effect of income taxes paid on FCM™, Free cash growth profile™, can be ascertained. In this calculation, income taxes paid are not reduced for tax benefits from stock options exercised.

See also: Income taxes paid as % of income before income taxes

Income taxes payable as a percentage of income before income taxes. In effect, the proportion of income before income taxes carried in taxes payable as of the end of a reporting period.

See also: Income taxes payable

Income taxes payable as a percentage of income before income taxes. In effect, the proportion of income before income taxes carried in taxes payable as of the end of a reporting period.

See also: Income taxes payable

A method of computing operating cash flow by adjusting net income for non-cash expenses and changes in operating-related balance sheet accounts.

Cash used in the purchase of investments as carried on the company-reported indirect method statement of cash flows.

The incremental addition to sustainable earnings contributed by an increase in revenue from core operations, reported in percentage terms. It is measured as the change in sustainable earnings divided by the change in revenue from core operations.

The incremental addition to operating profit contributed by an increase in revenue from core operations, reported in percentage terms. It is measured as the change in operating profit from core operations divided by the change in revenue from core operations.

A format for the operating section of the cash-flow statement that presents the derivation from net income of cash flow provided by operating activities. The format starts with net income and adjusts for nonoperating items, noncash income and expense and changes in operating-related working capital accounts.

An intangible asset that arises when a defined-benefit pension plan is underfunded. The amount of the underfunding is the excess of the accumulated benefit obligation over the fair value of pension assets held by the pension trust. The amount of this underfunding must be reported on the balance sheet as a net pension liability. If the pension plan sponsor's books do not already carry a net pension liability equal to or greater than the amount of the underfunding, then an adjustment, known as the additional minimum pension liability, is recorded for the amount needed to bring the previously reported net pension liability up to the amount of the underfunding. An intangible pension may be recognized as an offset to the additional minimum pension liability for an amount consisting primarily of any accumulated prior-service cost, that is, the accumulated plan underfunding arising from amendments to the plan that increase retirement benefits. However, any underfunding arising for reasons other than the amount of the accumulated prior-service cost must be recorded as a charge to accumulated other comprehensive income (loss). On the cash flow analysis statement the account is used in computing other nonrecurring cash receipts (disbursements), a component of investment of sustainable free cash flow.

On forecast financial statements, the interest rate to be used in forecast periods in computing interest income (expense) on cash surplus (shortage). For historical periods, the interest % earned on cash surplus or paid on cash shortage is equal to total interest paid as % of average borrowings.

Interest incurred on borrowed funds and capital leases during the construction of a discrete inventory project that is added to the cost of the project. This is a cash flow adjustment item. Interest capitalized to inventory is included in inventory on the balance sheet. On the cash flow analysis statement the account is used in computing change in inventory, a component of cash cost of revenue, and in computing total interest paid, a component of sustainable operating cash flow. That is, interest capitalized to inventory is removed from cash cost of revenue and added to total interest paid.

Interest incurred on borrowed funds and capital leases during the construction of a discrete inventory project that is added to the cost of the project. This is a cash flow adjustment item. Interest capitalized to inventory is included in inventory on the balance sheet. On the cash flow analysis statement the account is used in computing change in inventory, a component of cash cost of revenue, and in computing total interest paid, a component of sustainable operating cash flow. That is, interest capitalized to inventory is removed from cash cost of revenue and added to total interest paid.

Quarterly, year-to-date interest incurred on borrowed funds and capital leases during the construction of a discrete inventory project that is added to the cost of the project. This is a cash flow adjustment item for which necessary data may not be available in quarterly financial statements. Interest capitalized to inventory is included in inventory on the balance sheet. When data is available, on the cash flow analysis statement the account is used in computing change in inventory, a component of cash cost of revenue, and in computing total interest paid, a component of sustainable operating cash flow. That is, interest capitalized to inventory is removed from cash cost of revenue and added to total interest paid.

Interest incurred on borrowed funds and capital leases during the construction of a PP&E project that is added to the cost of the project. This is a cash flow adjustment item. It is disclosed in the notes to the financial statements. The amount of interest capitalized to PP&E is included PP&E on the balance sheet. On the cash flow analysis statement the account is used in computing total interest paid, a component of sustainable operating cash flow, and in computing capital expenditures, a component of investment to support operations. That is, interest capitalized to PP&E is removed from capital expenditures and added to total interest paid.

Interest incurred on borrowed funds and capital leases during the construction of a PP&E project that is added to the cost of the project. This is a cash flow adjustment item. It is disclosed in the notes to the financial statements. The amount of interest capitalized to PP&E is included PP&E on the balance sheet. On the cash flow analysis statement the account is used in computing total interest paid, a component of sustainable operating cash flow, and in computing capital expenditures, a component of investment to support operations. That is, interest capitalized to PP&E is removed from capital expenditures and added to total interest paid.

The amount of interest added to property, plant and equipment during the current quarter.

Quarterly, year-to-date interest incurred on borrowed funds and capital leases during the construction of a PP&E project that is added to the cost of the project. This is a cash flow adjustment item for which necessary data may not be available in quarterly financial statements. When available it is disclosed in the notes to the financial statements. The amount of interest capitalized to PP&E is included PP&E on the balance sheet. On the cash flow analysis statement the account is used in computing total interest paid, a component of sustainable operating cash flow, and in computing capital expenditures, a component of investment to support operations. That is, interest capitalized to PP&E is removed from capital expenditures and added to total interest paid.

The expense deduction during a period arising from outstanding debt and capital lease obligations as reported on the statement of income. Interest expense excludes interest capitalized to PP&E and inventory. On the cash flow analysis statement the account is used in computing interest paid, a component of sustainable operating cash flow. In instances where firms report interest expense, net, that interest expense, net is reported as interest expense.

Interest expense as reported on the income statement, net of interest capitalized, measured as a percentage of average interest-bearing borrowings.

Income generated during a period on interest-bearing credit balances. On the cash flow analysis statement the account is used in computing other recurring cash receipts (disbursements), a component of cash flow available for debt service.

On the forecast statements of income this account measures interest income projected to be earned on any cash surplus that is forecast to arise or interest expense to be incurred on any cash shortage that is forecast to arise. In each ensuing period, interest income (expense) is measured on the previous period's ending cash surplus or (shortage).

The dollar amount of shares of common stock issued in lieu of the cash payment of interest. The account is used in computing total interest paid, a component of sustainable operating cash flow and in computing common equity financing, a component of financing transactions.

The quarterly, year-to-date dollar amount of shares of common stock issued in lieu of the cash payment of interest. The account is used in computing total interest paid, a component of sustainable operating cash flow and in computing common equity financing, a component of financing transactions.

Interest due on borrowed funds that is currently due and payable. On the cash flow analysis statement the account is used in computing total interest paid, a component of sustainable operating cash flow.

Short-term and long-term debt and capital lease obligations on which interest accrues.

Costs incurred in developing new software applications for a company's own use and not for licensing to customers. Internal-use software development costs are capitalized once the preliminary project stage is completed.

An accounting standard issued by the International Accounting Standards Committee. This Committee has been replaced by the International Accounting Standards Board (IASB). IAS standards have been adopted by the IASB.

An international standard setting body. Its principal standard setting products are International Financial Reporting Standards (IFRS). The IASB assumed its duties from the International Accounting Standards Committee (IASC). Existing International Accounting Standards issued by the IASC were adopted by the IASB.

A financial reporting standard issued by the International Accounting Standards Board.

Stocks or goods that are completed and ready for sale.

Stocks or goods that cannot be classified as raw materials, work in process or finished goods inventories.

Stocks or goods in a raw or unmanufactured state that are used in the manufacture of goods for sale.

Stocks or goods in a partially manufactured or unfinished state that is not yet ready for sale.

The cost of goods held for resale in the ordinary course of operations. On the cash flow analysis statement the account is used in computing change in inventory, a component of cash cost of revenue.

See also: Inventory (incl. capitalized interest)

Inventory measured in terms of revenue from core operations per day. Calculated as inventory (incl. capitalized interest) divided by revenue from core operations measured on a daily basis using a 365-day year.

See also: Inventory (incl. capitalized interest) days

Inventory measured in terms of revenue from core operations per day. Calculated as inventory (incl. capitalized interest) divided by revenue from core operations measured on a daily basis using a 365-day year.

See also: Inventory (in revenue days)

Inventory (incl. capitalized interest) as a percentage of revenue from core operations. In effect, the proportion of revenue from core operations tied up in inventory at the end of a reporting period.

The change in inventory as carried on the company-reported indirect method statement of cash flows.

The amount of inventory measured on a FIFO cost or current cost basis. It is computed by adding the LIFO reserve back to LIFO inventory.

The FIFO cost or current cost of inventory measured relative to inventory valued on a LIFO basis. The measure provides an approximation to the amount of undervaluation of inventory as reported on the balance sheet.

Inventory measured in terms of revenue from core operations per day. Calculated as inventory, which includes capitalized interest, divided by revenue from core operations measured on a daily basis using a 365-day year.

See also: Inventory (in revenue days)

The number of times during a year that inventory is sold and replaced. Calculated by dividing cost of goods sold by ending inventory.

See also: Cash provided or used by investing activities

Cash invested in non-customer-related notes receivable measured as the change in notes receivable from one period to the next. For example, these receivables would include notes receivable from non-customers for the purpose of generating interest income as part of non-core operations. They are included as part of investment to support operations. Examples include retail notes receivable or other receivables generated by a finance subsidiary of a non-financial firm. Customer related notes receivable should be included with operating receivables.

See also: Investment in other net financial services assets

Intangible assets purchased to support operations but not acquired as part of an acquisition. Examples include patents and other purchased technology-related assets, copyrights and trademarks. Capitalized operating expenses related to intangible assets, such as capitalized software development costs, are reported separately. Computed as the change in operations-related intangibles from one period to the next. It is included as part of investment to support operations.

The driver underlying investment in operations-related intangibles. In particular, investment in operations-related intangibles is measured as a percentage of revenue from core operations on the presumption that operations-related intangibles will generally grow along with revenue and the scale of operations.

Investment in operations-related intangibles divided by revenue from core operations. Investment in operations-related intangibles to revenue % provides insight into the effects on sustainable free cash flow of changes in the pattern of spending on operations-related intangibles.

Other financial services assets, including notes receivable and other financial assets of a finance subsidiary of a non-financial firm less other financial services liabilities. Computed as the change in net other financial services assets from one period to the next. It is included as part of investment to support operations.

See also: Investment in notes receivable

Assets purchased to support operations that are not included elsewhere. Computed as the change in other operations-related assets from one period to the next. These assets were purchased to support operations rather than as an investment of sustainable free cash flow.

The driver underlying investment in other operations-related assets. In particular, investment in other operations-related assets is measured as a percentage of revenue from core operations on the presumption that other operations-related assets will generally grow along with revenue and the scale of operations.

Investment in other operations-related assets divided by revenue from core operations. Investment in other operations-related assets to revenue % provides insight into the effects on sustainable free cash flow of changes in the pattern of spending on other operations-related assets.

The driver underlying investment in other operations-related assets. In particular, investment in other operations-related assets is measured as a percentage of revenue from core operations on the presumption that other operations-related assets will generally grow along with revenue and the scale of operations.

Investment in other operations-related assets divided by revenue from core operations. Investment in other operations-related assets to revenue % provides insight into the effects on sustainable free cash flow of changes in the pattern of spending on other operations-related assets.

Discretionary investments of sustainable free cash flow including short-term and long-term investments, acquisitions and other assets. Not to be confused with investment to support operations, which is needed to provide operations infrastructure.

The proportion of revenue from core operations expended on investment support, or investment-related cash expenditures to provide operations infrastructure, including capital expenditures, notes receivable and operations-related intangible assets.

Investment-related cash expenditures to provide operations infrastructure, including capital expenditures, notes receivable and operations-related intangible assets. Not to be confused with the more discretionary investment of sustainable free cash flow.

Goodwill, the excess of the amount paid in an acquisition over the fair value of the acquired entity's identifiable net assets, plus other intangible assets, acquired as part of a business acquisition. It is included as part of investment of sustainable free cash flow. Note that property, plant and equipment acquired as part of an acquisition are included with capital expenditures.

Purchases of assets not properly classifiable elsewhere. Included as part of investment of sustainable free cash flow.

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An inventory method that includes the earliest as opposed to most current, inventory acquisition costs in cost of sales.

Adjustments to reported operating cash flow for nonrecurring items grouped into layers based upon the extent to which each item is perceived as being nonrecurring. The layered adjustments are employed in the process of measuring sustainable operating cash flow.

Amounts due from customers on long-term sales-type lease agreements.

Performance measures focused on analyzing a firm's ability to meet debt service requirements.

The progression of a firm through various stages of its organizational life, consisting of start-up, growth, maturity and decline, during which earnings and operating cash flow have certain characteristic relationships.

A reduction in the physical quantity of an inventory that is accounted for using the LIFO method. A LIFO liquidation usually produces a nonrecurring increase in earnings because the older costs associated with the liquidated units are lower than current inventory costs.

A disclosure required for firms reporting inventory on a LIFO, or last-in, first-out basis, it is the difference between inventory measured on a LIFO cost basis, reflecting older purchases costs, and that same inventory measured on a FIFO cost or current cost basis. For LIFO firms, the LIFO reserve provides an approximation to the amount that inventory is undervalued relative to current cost. On the financial performance report the account is used in computing ratios measuring activity.

Performance measures focused on analyzing the availability of funds needed to meet near-term obligations.

Any expense, loss or (income), where (income) is entered as a bracketed amount, resulting from corporate litigation. On the cash flow analysis statement the account is used in computing other nonrecurring cash receipts (disbursements), a component of investment of sustainable free cash flow.

Cash provided from the issuance of long-term debt as carried on the company-reported indirect method statement of cash flows.

Cash used to repurchase or retire long-term debt as carried on the company-reported indirect method statement of cash flows.

Financing obligations due beyond one year, consisting of the noncurrent portion of long-term debt, the noncurrent portion of capital lease obligations, noncurrent financing-related notes payable, and other financing-related noncurrent liabilities.

Long-term financing consisting of bonds payable, long-term debt, long-term capital lease obligations, other financing-related notes payable and other financing-related noncurrent liabilities.

Principal on long-term debt that is due and payable during the second year after the balance sheet date.

Principal on long-term debt that is due and payable during the third year after the balance sheet date.

Principal on long-term debt that is due and payable during the fourth year after the balance sheet date.

Principal on long-term debt that is due and payable during the fifth year after the balance sheet date.

The principal due on debt obligations, including notes payable, bonds payable and other similar obligations considered to be part of a firm's financing arrangements, classified as long-term, that is, typically due beyond one year.

Investments in marketable and nonmarketable securities, including investments accounted for under the equity method, held for periods expected to extend beyond one year or the operating cycle, whichever is longer. On the cash flow analysis statement the account is used in computing long-term investments, a component of investment of sustainable free cash flow.

Amounts due from customers, typically on an installment basis, which extend beyond one year.

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A presentation required by the SEC of registrants in their 10-K and 10-Q filings. The information includes commentary on changes in earnings over the past three years, a discussion of liquidity and capital resources, and the provision of information concerning contractual cash obligations.

Preferred stock that carries an unconditional obligation to be repurchased at a specified or determinable date, making the shares a hybrid security between debt and equity.

The highest rate at which the last amount of revenue, gain, expense, or loss is taxed. In most cases the marginal rate is the combined statutory federal and state rates that are disclosed in the reconciliation of expected and actual taxes found in the tax note. The account is used on the financial performance report in computing ratios measuring profitability.

See also: Marginal tax rate

The highest rate at which the last amount of revenue, gain, expense, or loss is taxed. In most cases the marginal rate is the combined statutory federal and state rates that are disclosed in the reconciliation of expected and actual taxes found in the tax note. The account is used on the financial performance report in computing ratios measuring profitability.

See also: Marginal fed, state & foreign income tax rate on contg ops

The market value of a firm's outstanding common shares. It is computed as the number of common shares outstanding times the closing market price per share.

The third segment of a company's life cycle during which growth in revenue slows to or below the rate of growth in the overall economy, though earnings may continue to grow at a faster rate. Depending on the amount of non-cash expenses reported, such as depreciation and amortization expense, operating cash flow will usually exceed earnings.

All claims on the assets, earnings and cash flows of an entity that are not classifiable as liabilities or shareholders' equity. It is calculated as the sum of minority interest in equity plus other mezzanine interests.

A middle section on the balance sheet positioned between liabilities and shareholders' equity, where claims that have elements of both, including minority interests, are typically reported.

The amount of rent charged to expense on operating leases during the period, excluding contingent rents measured as a percentage of revenue from core operations.

See also: Minimum rent expense on operating leases

An attribution to the third-party owners of that portion of net income of a consolidated entity that is not 100% owned. On the cash flow analysis statement the account is used in computing other equity-related financing, a component of investment of financing transactions.

The interest in the equity of an entity that reflects the portion of shareholders' equity owned by noncontrolling or third-party investors, or investors outside the consolidated entity. On the cash flow analysis statement the account is used in computing other equity-related financing, a component of financing transactions.

An attribution to the third-party owners of that portion of net income of a consolidated entity that is not 100% owned. On the cash flow statement (indirect method) the account balance serves as an adjustment to Income (loss) from continuing operations in computing sustainable operating cash flow.

An accounting basis that is a blend of cash and accrual accounting. Some items are accounted for on an accrual basis while others are accounted for on a cash basis.

The Money Flow Index (MFI) is used to measure the strength of money flowing in and out of a security. The MFI is similar to the Relative Strength Index (RSI), but also takes into consideration volume action.

The Moving Average Convergence Divergence (MACD), developed by Gerald Appel, is both an oscillator and a trend indicator. It is the difference between a fast Exponential Moving Average (EMA) and a slow Exponential Moving Average and the fast Moving Average is continually converging towards or diverging away from the slow Moving Average. A third Exponential Moving Average, or signal line, is then plotted to identify changes in trends and market sentiment.

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Net assets, assets less liabilities and mezzanine interests, measured in terms of revenue from core operations per day. Calculated as net assets divided by revenue from core operations measured on a daily basis using a 365-day year.

Net assets, assets less liabilities and mezzanine interests, measured in terms of revenue from core operations per day. Calculated as net assets divided by revenue from core operations measured on a daily basis using a 365-day year.

The separately identified assets less liabilities of a business segment or unit slated for disposition.

Gross capital expenditures less proceeds from the disposal of productive assets.

The cash paid to repurchase shares issued as a result of the exercise of stock options by company officers and employees. The net amount paid is computed by subtracting the proceeds received from option exercises during the year from the cash paid to repurchase the same number of shares. Subtracted from this net payment is the amount of any tax benefit from stock options exercised.

The actual change in retained earnings from one period to the next as reported on the balance sheet. It will equal net change in retained earnings. This amount is automatically calculated.

The actual change in retained earnings from one period to the next computed as calculated net income (loss) less dividends declared - preferred, less dividends declared - common, plus the inc (dec) in retained earnings for stock repurchases and conversions, plus the inc (dec) in retained earnings for other equity transactions plus other increase (decrease) in retained earnings. The amount will equal the net change in RE from balance sheet.

Total debt less cash and cash equivalents on hand.

GAAP-defined income as reported on the primary statement of income. Consists of net income (loss) from continuing operations less the effects, if any, of discontinued operations, extraordinary items and the cumulative effect of changes in accounting principle.

After-tax net income before discontinued operations, extraordinary items and the cumulative effect of changes in accounting principle.

See also: Income (loss) from continuing operations

Net income (loss) from continuing operations divided by the weighted average number of diluted common shares outstanding during the reporting period.

Net income (loss) divided by the average number of diluted common shares outstanding during the reporting period.

Often referred to as traditional cash flow, its calculation removes an important non-cash expense from net income.

The actual company reported change in cash and cash equivalents during a period. The model automatically calculates the change by combining reported cash provided (used ) by operating activities, reported cash provided (used) by investing activities, reported cash provided (used) by financing activities, effects of exchange rate changes on cash - source (use), and other reported source (use) of cash.

Sustainable earnings to revenue from core operations. The percentage of revenue from core operations that results in sustainable earnings.

Current and operating working capital assets less current and operating working capital liabilities. A positive figure represents the amount of working capital assets that must be financed with other liabilities or shareholders' equity. A negative figure represents the amount that is being used to finance other noncurrent assets.

The percentage of revenue from core operations that results in sustainable earnings.

The total number of common shares outstanding as of the end of a reporting period. It is the number of common shares issued less common shares held in the treasury. On the financial performance report, the account is used in calculating ratios measuring dilution.

The number of common shares repurchased during a period, whether held in the treasury, canceled or resold. This is a cash flow adjustment item. The amount is disclosed on the statement of shareholders' equity. On the cash flow analysis statement the account is used in computing net cash paid in buyback of shares for options, a component of other recurring cash receipts (disbursements).

The number of common shares covered by stock options that may be exercised at any time. On the financial performance report, the account is used in calculating ratios measuring dilution.

The number of common shares issued as a result of stock options exercised during the period. This is a cash flow adjustment item. The amount is disclosed in the notes to the financial statements. On the cash flow analysis statement the account is used in computing net cash paid in buyback of shares for options, a component of other recurring cash receipts (disbursements) and in computing common equity financing, a component of financing transactions.

The number of common shares covered by stock options that were granted during the period. On the financial performance report, the account is used in calculating ratios measuring dilution.

The number of common shares covered by stock options outstanding at period end. On the financial performance report, the account is used in calculating ratios measuring dilution.

The total number of persons employed by an organization. On the financial performance report, the account is used in calculating ratios measuring activity.

Generally, minority interest. However, the term is used to reflect a minority shareholder interest when the definition of control is extended beyond a simple majority share ownership interest. Any interest in an entity besides that of a controlling shareholder.

Incurred operating costs or expenses that have not been paid and for which payment is expected to be made beyond one year or the operating cycle, whichever is longer. On the cash flow analysis statement the account is used in computing change in accruals, a component of cash operating expense.

See also: Accruals

Assets not classified as current assets. When a total amount is given, it represents the total amount of noncurrent assets as reported on the balance sheet.

Noncurrent assets of business segment or separately-reported business unit that is scheduled for disposition. On the cash flow analysis statement the account is used in computing disposition of discontinued operations, a component of investment of sustainable free cash flow.

Expenditures that are reported as assets to be amortized against future revenue and that are classified as noncurrent. On the cash flow analysis statement the account is used in computing change in capitalized operating expenses, a component of cash operating expense.

See also: Capitalized operating expenses

Revenue that is collected in advance of being earned and is reported as a liability. Because it is classified as noncurrent, the revenue is expected to be earned beyond one year or the operating cycle, whichever is longer. Also referred to as unearned revenue, customer deposits, and for airlines, air traffic liability. For contractors, deferred revenue consists of amounts billed customers in excess of cost plus profit recognized. On the cash flow analysis statement the account is used in computing change in deferred revenue, a component of cash from revenue.

See also: Deferred revenue

Future tax benefits that result from (1) the origination of a deductible temporary difference, that is, a tax deduction that can be used in a future period, or (2) a loss or tax-credit carryover, measured as a percentage of income before income taxes. The noncurrent classification arises from the fact that these deferred tax assets arise from balance-sheet items that are classified as noncurrent.

See also: Noncurrent deferred tax assets

Future tax obligations that result from the origination of taxable temporary differences measured as a percentage of income before income taxes. The noncurrent classification arises from the fact that these deferred tax liabilities arise from balance-sheet items that are classified as noncurrent.

See also: Noncurrent deferred tax liabilities

Notes payable and other borrowings the principal on which is due beyond one year. On the cash flow analysis statement the account is used in computing long-term debt financing, a component of financing transactions.

Liabilities expected to be repaid or otherwise settled beyond one year or the operating cycle, whichever is longer. When a total is given it represents the total of noncurrent liabilities as reported on the balance sheet.

Current liabilities of business segment or separately-reported business unit that is scheduled for disposition. On the cash flow analysis statement the account is used in computing disposition of discontinued operations, a component of investment of sustainable free cash flow.

Non-customer-related notes receivable classified as noncurrent. On the cash flow analysis statement the account is used in computing investment in notes receivable, a component of investment to support operations.

See also: Investment in notes receivable

Amounts due from customers or other operating-related transactions that is due beyond one year or the operating cycle, whichever is longer. On the cash flow analysis statement the account is used in computing change in operating receivables, a component of cash from revenue.

See also: Customer-related notes receivable

Principal on capital lease obligations net of any principal due within one year. On the cash flow analysis statement the account is used in computing long-term debt financing, a component of financing transactions.

Principal on long-term debt borrowings net of any principal due within one year. On the cash flow analysis statement the account is used in computing long-term debt financing, a component of financing transactions.

Costs or expenses that have been paid in advance of being incurred and that are classified as noncurrent. On the cash flow analysis statement the account is used in computing change in prepaids, a component of cash operating expense.

See also: Prepaids

Principal amount on borrowings that, in the event of liquidation of corporate assets, have a secondary claim to other senior obligations. Convertible debt, which is typically subordinated, is included here. On the cash flow analysis statement the account is used in computing subordinated debt financing, a component of financing transactions.

Principal amount on borrowings that, in the event of liquidation of corporate assets, have a secondary claim to other senior obligations. On the cash flow analysis statement the account is used in computing subordinated debt financing, a component of financing transactions.

Noncurrent amounts due vendors for purchases made that are represented by a more formal obligation than credit due on open account. On the cash flow analysis statement the account is used in computing change in operating payables, a component of cash cost of revenue.

See also: Operating payables

An option to purchase stock that requires payment of ordinary income taxes by the option holder on the date of exercise on income equal to the excess of the market price of the purchased stock over the exercise price of the option. The company issuing the option receives an expense deduction equal to the ordinary income of the option holder.

Operating cash flow that appears infrequently or that may appear with some regularity but is very irregular in amount. In addition, even though included in operating cash flow, nonrecurring cash flow is often not closely tied to the core operating activities of the firm.

Items that appear infrequently or that may appear with some regularity but are very irregular in amount. These items are usually not closely tied to the core operating activities of the firm.

Promissory notes that are evidence of a debt and state the terms of interest and principal payment.

The sum of the current and noncurrent portions of non-customer-related notes receivable.

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The percentage of revenue from core operations that results in sustainable operating cash flow. It is driven by the determinants of a firm's core cash margin, its other recurring cash receipts and disbursements, income taxes paid, and interest paid. Because it is calculated as the amount of sustainable operating cash flow generated during a period measured as a percentage of revenue from core operations, Operating cash margin™ is influenced by changes in a firm's cash-flow drivers. For example, a reduction in inventory days or an increase in operating payables days would increase Operating cash margin™, but only temporarily. As such, a firm's Operating cash margin™ for one period is not necessarily indicative of Operating cash margin™ for future periods.

Costs incurred in exploring for new oil reserves and for preparing existing reserves for sale, including the drilling and equipping of wells.

The percentage of revenue from core operations that results in operating profit.

Cash flow from operating activities computed in accordance with generally accepted accounting principles.

See also: Operating profit

A lease that does not transfer the risks and rewards of ownership to the lessee. Operating lease payments are expensed as incurred.

The cumulative minimum rent expense on operating leases due within five years.

The cumulative minimum rent expense on operating leases due beyond five years.

Losses are first carried back for two-years, eliminating previous profits and producing a tax refund. If losses remain, then these may be carried forward for as long as 20 years. These losses will shield future profits from taxation. Corporations may also elect to forgo the loss carryback and only carry the loss forward for 20 years.

Operating profit to revenue from core operations.

Operating payables measured in terms of revenue from core operations per day. Calculated as operating payables divided by revenue from core operations measured on a daily basis using a 365-day year.

See also: Operating payables days; Payables days

Operating payables measured in terms of revenue from core operations per day. Calculated as operating payables divided by revenue from core operations measured on a daily basis using a 365-day year.

See also: Operating payables (in revenue days); Payables days

Operating payables as a percentage of revenue from core operations. In effect, the proportion of revenue from core operations owed to vendors as of the end of a reporting period.

Core pretax profit from central operations calculated as revenue less cost of goods sold, selling, general and administrative expense and research and development expense.

See also: Operating profit from core operations

Core pretax profit from central operations calculated as revenue less cost of goods sold, selling, general and administrative expense and research and development expense.

See also: Operating profit

The percentage change in operating profit from core operations from one period to the next.

Operating profit of a non-core financial services subsidiary calculated as revenue from financial services operations less expenses of financial services operations.

The percentage change in operating profit from financial services operations from one period to the next.

Operating receivables measured in terms of revenue from core operations per day. Calculated as operating receivables divided by revenue from core operations measured on a daily basis using a 365-day year.

See also: Operating receivables days; Receivables days

Operating receivables measured in terms of revenue from core operations per day. Calculated as operating receivables divided by revenue from core operations measured on a daily basis using a 365-day year.

See also: Receivables days

Operating receivables as a percentage of revenue from core operations. In effect, the proportion of revenue from core operations tied up in amounts due from customers as of the end of a reporting period.

The time span, calculated based on revenue from core operations measured on a daily basis using a 365-day year, during which a firm's own cash is used to acquire or produce goods and services, which in turn are sold to customers, who in turn ultimately pay for their purchases in cash. It is calculated as operating receivables days plus inventory (incl. capitalized interest) days plus capitalized operating expenses days, plus prepaids days, minus deferred revenue days, minus operating payables days minus accruals days. Reductions in the measure indicate improving efficiencies in managing operating working capital.

See also: Cash cycle; Operating working capital (cash cycle) (in revenue days)

The time span, calculated based on revenue from core operations measured on a daily basis using a 365-day year, during which a firm's own cash is used to acquire or produce goods and services, which in turn are sold to customers, who in turn ultimately pay for their purchases in cash. It is calculated as operating receivables days plus inventory (incl. capitalized interest) days plus capitalized operating expenses days, plus prepaids days, minus deferred revenue days, minus operating payables days minus accruals days. Reductions in the measure indicate improving efficiencies in managing operating working capital.

See also: Cash cycle; Operating working capital (cash cycle) (in revenue days)

Assets used in operations consisting of operating receivables, inventory, capitalized operating expenses and prepaids

Operating working capital assets, consisting of operating receivables, inventory, capitalized operating expenses and prepaids, measured in terms of revenue from core operations per day. Calculated as operating working capital assets divided by revenue from core operations measured on a daily basis using a 365-day year.

Liabilities incurred in operations consisting of deferred revenue, operating payables and accruals.

Operating working capital liabilities, consisting of deferred revenue, operating payables, and accruals, measured in terms of revenue from core operations per day. Calculated as operating working capital liabilities divided by revenue from core operations measured on a daily basis using a 365-day year.

The time span, calculated based on revenue from core operations measured on a daily basis using a 365-day year, during which a firm's own cash is used to acquire or produce goods and services, which in turn are sold to customers, who in turn ultimately pay for their purchases in cash. It is calculated as operating receivables days plus inventory (incl. capitalized interest) days plus capitalized operating expenses days, plus prepaids days, minus deferred revenue days, minus operating payables days minus accruals days. Reductions in the measure indicate improving efficiencies in managing operating working capital.

See also: Cash cycle; Operating working capital (cash cycle) (in revenue days)

The time span, calculated based on revenue from core operations measured on a daily basis using a 365-day year, during which a firm's own cash is used to acquire or produce goods and services, which in turn are sold to customers, who in turn ultimately pay for their purchases in cash. It is calculated as operating receivables days plus inventory (incl. capitalized interest) days plus capitalized operating expenses days, plus prepaids days, minus deferred revenue days, minus operating payables days minus accruals days. Reductions in the measure indicate improving efficiencies in managing operating working capital. For quarterly results, revenue is annualized before the ratio is computed.

See also: Cash cycle; Operating working capital (cash cycle) (in revenue days)

The time span, calculated based on revenue from core operations measured on a daily basis using a 365-day year, during which a firm's own cash is used to acquire or produce goods and services, which in turn are sold to customers, who in turn ultimately pay for their purchases in cash. It is calculated as operating receivables days plus inventory (incl. capitalized interest) days plus capitalized operating expenses days, plus prepaids days, minus deferred revenue days, minus operating payables days minus accruals days. Reductions in the measure indicate improving efficiencies in managing operating working capital.

See also: Cash cycle; Operating working capital (cash cycle) (in revenue days)

Operating working capital as a percentage of revenue from core operations. In effect, the proportion of revenue from core operations tied up in working capital as of the end of a reporting period. Core operating cash flow is consumed by increases in operating working capital. Changes in operating working capital to revenue % measures a firm's efficiency in managing operating working capital.

See also: Cash cycle

Operating working capital as a percentage of revenue from core operations. In effect, the proportion of revenue from core operations tied up in working capital as of the end of a reporting period. Core operating cash flow is consumed by increases in operating working capital. Changes in operating working capital to revenue % measures a firm's efficiency in managing operating working capital. For quarterly results, revenue is annualized before the ratio is computed.

See also: Cash cycle

Intangible assets purchased to support operations but not acquired as part of an acquisition. Examples include patents and other purchased technology-related assets, copyrights and trademarks. Capitalized operating expenses related to intangible assets, such as capitalized software development costs, are reported separately. On the cash flow analysis statement the account is used in computing investment in operations-related intangibles, a component of investment to support operations.

Operations-related intangibles measured in terms of revenue from core operations per day. Calculated as operations-related intangibles, net divided by revenue from core operations measured on a daily basis using a 365-day year.

Cash flow classifications that are motivated by the desire to achieve a particular operating cash flow outcome. The presence of some degree of flexibility or ambiguity in cash flow classification is exploited.

See also: Creative cash flow reporting

Equity-related compensation expense that is included in SG&A. On the cash flow analysis statement, the account is used in computing selling, general and administrative expense (excl. depreciation & amortization), a component of cash operating expense, and in computing common equity financing, a component of financing transactions.

Quarterly, year-to-date equity-related compensation expense that is included in SG&A. On the cash flow analysis statement, the account is used in computing selling, general and administrative expense (excl. depreciation & amortization), a component of cash operating expense, and in computing common equity financing, a component of financing transactions.

The purchase price of a call option or put option that reflects both an intrinsic value for the option represented by the difference between the option's exercise price and the market price of the asset covered by the option and the time value of money.

A measure of the potential near-term dilution of common shares outstanding as a result of the exercise of outstanding options.

A measure of actual dilution of average basic shares outstanding as a result of options exercised during the period.

A measure of potential future dilution of average basic shares outstanding resulting from new option grants during the period.

A measure of potential future dilution of shares outstanding at period end resulting from the exercise of options.

The amount of outstanding, unfilled orders as of the end of the period. On the financial performance report, the account is used in calculating ratios measuring profitability.

The initial creation of a temporary difference between pretax book income and taxable income.

Income or expense of a nonrecurring nature that does not fit identified categories. Judging whether other income or expense is recurring or nonrecurring depends on such factors as the likely source and whether amounts are reasonably stable or growing consistently over time. On the cash flow statement (indirect method), the account balance is removed from Income (loss) from continuing operations in the computation of sustainable operating cash flow.

Intangible assets, other than goodwill, arising as a result of an acquisition, net of accumulated amortization or writedowns for impairment. Examples include patents, trademarks, brands, customer lists and non-compete agreements. On the cash flow analysis statement the account is used in computing investments in goodwill and acquisition-related intangibles, a component of investment of sustainable free cash flow.

Current assets not directly classifiable elsewhere including current other notes receivable, other operations-related current assets, other investing-related current assets and current assets of discontinued operations.

Current liabilities not directly classifiable elsewhere including other operations-related current liabilities and current liabilities of discontinued operations.

Net proceeds from equity-related financing transactions that are not classified as either preferred equity financing or common equity financing. Mezzanine financing is included here, including changes in minority interests. Changes in retained earnings for transactions excluding net income or dividends are included here, for example, reductions in retained earnings resulting from stock buybacks and stock conversions. Also included is any change in the amount by which the balance sheet is out of balance.

Notes receivable and other financial assets of a finance subsidiary of a non-financial firm. On the cash flow analysis statement the account is used in computing investment in other net financial services assets, a component of investment to support operations.

Financing-related obligations of a financial services firm that are not included as borrowings elsewhere. Accruals and other liabilities arising in the course of operations should be excluded. On the cash flow analysis statement the account is used in computing investment in other net financial services assets, a component of investment to support operations.

The principal amount on obligations due within one year that are not included as borrowings elsewhere. Financing-related liabilities do not include accruals and other liabilities arising in the course of operations. On the cash flow analysis statement the account is used in computing short-term debt financing, a component of financing transactions.

The principal amount on obligations due beyond one year that are not included as borrowings elsewhere. Financing-related liabilities do not include accruals and other liabilities arising in the course of operations. On the cash flow analysis statement the account is used in computing long-term debt financing, a component of financing transactions.

All financing-related obligations that are not included as borrowings elsewhere. Calculated as the sum of other financing-related noncurrent liabilities and other financial services liabilities.

All sources of income and expense from continuing operations that does is not considered part of core operations or of financial services operations.

Income or expense of a nonrecurring nature that does not fit identified categories. Judging whether other income (expense) is recurring or nonrecurring depends on such factors as the likely source and whether amounts are reasonably stable or growing consistently over time. On the cash flow analysis statement the account is used in computing other nonrecurring cash receipts (disbursements), a component of investment of sustainable free cash flow.

Income or expense of a recurring nature that does not fit identified categories. Judging whether other income (expense) is recurring or nonrecurring depends on such factors as the likely source and whether amounts are reasonably stable or growing consistently over time. On the cash flow analysis statement the account is used in computing other recurring cash receipts (disbursements), a component of cash flow available for debt service.

An amount needed to account for the change in retained earnings from one period to the next that has not already been accounted for with net income, dividends, and other known equity-related transactions. This account, which is automatically computed, reconciles the change in retained earnings accounted for with income, dividends and other known equity-related transactions with the actual change in retained earnings from one period to the next as reported on the balance sheet. Prior-period restatements and reclassifications can cause this account to show a balance. However, it is also possible that input data for the statement of income, statement of shareholders' equity or the balance sheet were entered in error. When a balance is reported for this account, except in the first year for which data is available for a firm, activity in retained earnings on the company-provided statement of shareholders' equity should be compared with similar activity on the statement of income and related input data to evaluate and resolve its cause. On the cash flow analysis statement the account is used in computing other increase (decrease) in retained earnings, a component of financing transactions.

Unidentified assets related to the investing activites of as opposed to the operating activities of the firm.

Assets, not classifiable elsewhere, that are not purchased in direct support of operations infrastructure but that serve as a discretionary use of sustainable free cash flow. The assets will be consumed or disposed of within one year or the operating cycle, whichever is longer. On the cash flow analysis statement the account is used in computing investments in other assetes, a component of investment of sustainable free cash flow.

Assets, not classifiable elsewhere, that are not purchased in direct support of operations infrastructure but serve as a discretionary use of sustainable free cash flow. The assets are classified as noncurrent. On the cash flow analysis statement the account is used in computing investments in other assets, a component of investment of sustainable free cash flow.

Claims on the assets, earnings and cash flows of an entity that are not classifiable as liabilities or shareholders' equity and that are not a component of minority interest in equity. One example is redeemable preferred stock that is not classified as a liability. On the cash flow analysis statement the account is used in computing other equity-related financing, a component of financing transactions.

Financial services assets of a finance subsidiary of a non-financial firm less other financial services liabilities.

Cash receipts and disbursements that are not from a sustainable origin. Included as part of investment of sustainable free cash flow. Examples include nonrecurring revenue and other nonrecurring income or expense, foreign currency gains and losses, restructuring charges adjusted for changes in a restructuring reserve, litigation charges, extraordinary items, and changes in other balance sheet accounts such as other operations-related liabilities and accumulated other comprehensive income.

Assets purchased to support operations that are not included elsewhere. These assets were purchased to support operations rather than as an investment of sustainable free cash flow.

Assets purchased to support operations infrastructure that are not included elsewhere and that are to be held for less than one year or the operating cycle, whichever is longer. On the cash flow analysis statement the account is used in computing investment in other operations-related assets, a component of investment to support operations.

Other operations-related current assets measured in terms of revenue from core operations per day. Calculated as other operations-related current assets divided by revenue from core operations measured on a daily basis using a 365-day year.

Obligations incurred in operations that are not classified elsewhere and that are due within one year or the operating cycle, whichever is longer. On the cash flow analysis statement the account is used in computing other nonrecurring cash receipts (disbursements), a component of investment of sustainable free cash flow.

Assets purchased to support operations that are not included elsewhere and that are classified as noncurrent. On the cash flow analysis statement the account is used in computing investment in other operations-related assets, a component of investment to support operations.

Other operations-related noncurrent assets measured in terms of revenue from core operations per day. Calculated as other operations-related noncurrent assets divided by revenue from core operations measured on a daily basis using a 365-day year.

Obligations incurred in operations that are not classified elsewhere and that are classified as noncurrent. On the cash flow analysis statement the account is used in computing other nonrecurring cash receipts (disbursements), a component of investment of sustainable free cash flow.

Shareholders' equity accounts that are not classified elsewhere. On the cash flow analysis statement the account is used in computing common equity financing, a component of financing transactions.

Cash receipts and disbursements that are not part of core operations but that are nonetheless from a sustainable source. Examples include collections for interest, dividends, rents, royalties and miscellaneous collections that are nonetheless considered recurring. Also included are revenue and expenses from financial services operations and any net cash paid in the buyback of shares for options.

Other unidentified financing sources or (uses) of cash as carried on the company-reported indirect method statement of cash flows.

Other unidentified investing sources or (uses) of cash as carried on the company-reported indirect method statement of cash flows.

Other unidentified sources of (uses) of cash as carried on the company-reported indirect method statement of cash flows.

Company reported changes in cash that are not classified as operating, investing, financing cash flow or as the effects of exchange rate changes in cash.

Common shareholder claims on the assets, earnings and cash flows of an entity that are not classifiable elsewhere. It consists of other positive (negative) equity accounts, less deferred compensation, less subscription notes receivable, and plus or minus the amount, if any, by which the balance sheet is out of balance.

A cash outflow of which a portion is unlikely to be sustained. A common example is a dramatically increased contribution to underfunded defined benefit pension plans.

A negative cash balance.

A negative cash balance for reporting purposes consisting of the excess of outstanding checks over a stated bank cash balance. On the cash flow analysis statement the account is used in computing short-term debt financing, a component of financing transactions.

See also: Book overdraft

The amount of book overdrafts included in accounts payable. If material, it is disclosed in the notes to the financial statements. On the balance sheet, overdrafts payable are included with short-term debt. On the cash flow analysis statement the account is used in computing change in operating payables, a component of cash cost of revenue, and in computing short-term debt financing, a component of financing transactions.

The amount of book overdrafts included in accounts payable. This is an adjustment item. If material, it is disclosed in the notes to the financial statements. On the balance sheet, overdrafts payable are included with short-term debt. On the cash flow analysis statement the account is used in computing change in operating payables, a component of cash cost of revenue, and in computing short-term debt financing, a component of financing transactions.

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The number of days it would take to pay the ending balance in operating payables at the average rate of costs of goods sold per day. Calculated by dividing 365 by payables turnover.

See also: Operating payables days

The number of times during a year that operating payables are repaid and re-incurred. Calculated by dividing cost of goods sold by ending operating payables.

The price / earnings multiple computed using the closing price and sustainable earnings per diluted share.

The price / earnings multiple computed using the closing price and TTM sustainable earnings per diluted share.

A method of accounting for contracts requiring extended periods of completion where revenue and profit are recognized based on progress made toward completion. Revenue amounts recognized may differ from amounts billed.

Abbreviation for Financial Performance Report.

A difference between book and tax return income that never reverses. Life insurance proceeds are considered to be revenue for book purposes but are exempt from taxation. A fine is never deductible in the tax return but is typically a deduction in the book income statement. Each of these is a permanent difference.

A secured borrowing arrangement based on accounts receivable where selected accounts receivable serve as loan collateral.

See also: Customer acquisition costs

Dividends declared on preferred stock.

The dollar amount of dividends declared on preferred stock during the reporting period.

The dollar amount of preferred dividends on cumulative preferred stock that has not been paid. Typically, these dividends must be paid before dividends may be paid on common stock.

Net proceeds from the issue of preferred stock.

The dollar amount of issued preferred stock. On the cash flow analysis statement the account is used in computing preferred equity financing, a component of financing transactions.

The dollar amount of shares of common stock issued in lieu of the cash payment of dividends on preferred stock. On the cash flow analysis statement the account is used in computing dividends - preferred, a component of cash flow available for investment and in computing common equity financing, a component of financing transactions.

The total dollar value of the greater of the voluntary liquidation value of all outstanding preferred shares or the mandatory redemption value of those shares.

Revenue recognized for a confirmed sale or service transaction in a period prior to that called for by generally accepted accounting principles.

Prepaids measured in terms of revenue from core operations per day. Calculated as prepaids divided by revenue from core operations measured on a daily basis using a 365-day year.

See also: Prepaids days

Prepaids measured in terms of revenue from core operations per day. Calculated as prepaids divided by revenue from core operations measured on a daily basis using a 365-day year.

See also: Prepaids (in revenue days)

Prepaids as a percentage of revenue from core operations. In effect, the proportion of revenue from core operations tied up in prepaids as of the end of a reporting period.

The percentage change in pretax sustainable earnings from one period to the next.

See also: Pretax sustainable earnings

The percent pretax earnings return generated by average total assets during a period. Calculated by dividing pretax sustainable earnings by average total assets. Pretax sustainable earnings are adjusted to exclude known items of nonrecurring revenue, gain, expense and loss.

A valuation metric calculated as the closing market price to book value per common share.

A valuation metric calculated as the closing market price divided by cash and short-term investments net of total borrowings.

A valuation metric that measures the closing price relative to cash and cash equivalents plus short-term investments, trading securities and long-term investments, less outstanding borrowings. No amount is reported when borrowings exceed cash and investments.

A price multiple calculated using earnings before interest expense, tax expense, depreciation and amortization expense per diluted share.

A price multiple calculated using sustainable free cash flow per diluted share.

A price multiple calculated using sustainable operating cash flow per diluted share.

A valuation metric that measures the closing price relative to tangible net worth, shareholders' equity less goodwill and acquisition-related intangibles.

For quarterly results, a price multiple calculated using trailing twelve months sustainable free cash flow per diluted share.

For quarterly results, a price multiple calculated using trailing twelve months sustainable operating cash flow per diluted share.

As of year-end of a prior year, the principal on capital lease obligations scheduled for repayment during the ensuing year.

As of year-end of a prior year, the principal on long-term debt scheduled for repayment during the ensuing year.

A measures of earnings performance that selectively excludes nonrecurring as well as some non-cash items.

The cash proceeds from the sale of assets that are simultaneously leased back under operating leases. Such transactions are, in substance, financing events. This is a cash flow adjustment item. Proceeds from sale and operating leaseback transactions may be found in reported cash provided (used) by investing activities, in reported cash provided (used) by financing activities, or, if not disclosed on the statement of cash flows, such proceeds may be found in the notes to the financial statements. On the cash flow analysis statement the account is used in computing capital expenditures, a component of investment to support operations and in computing sale and leaseback financing, a component of financing transactions.

The cash proceeds from the sale of assets that are simultaneously leased back under operating leases. Such transactions are, in substance, financing events. This is a cash flow adjustment item. Proceeds from sale and operating leaseback transactions may be found in reported cash provided (used) by investing activities, in reported cash provided (used) by financing activities, or, if not disclosed on the statement of cash flows, such proceeds may be found in the notes to the financial statements. On the cash flow analysis statement the account is used in computing capital expenditures, a component of investment to support operations and in computing sale and leaseback financing, a component of financing transactions.

The quarterly, year-to-date cash proceeds from the sale of assets that are simultaneously leased back under operating leases. Such transactions are, in substance, financing events. This is a cash flow adjustment item, for which necessary data may not be available in quarterly financial statements. Proceeds from sale and operating leaseback transactions may be found in reported cash provided (used) by investing activities, in reported cash provided (used) by financing activities, or, if not disclosed on the statement of cash flows, such proceeds may be found in the notes to the financial statements. On the cash flow analysis statement the account is used in computing capital expenditures, a component of investment to support operations and in computing sale and leaseback financing, a component of financing transactions.

Performance measures focused on analyzing the results of income-directed activities.

The actuarial present value of all benefits earned to date on a defined-benefit pension plan in which future compensation levels are incorporated into the estimation of the plan obligation.

On the forecast balance sheets this account measures the cumulative increase (decrease) in cash and equivalents that is forecast as of the end of each forecast period. The account includes any interest income (expense) on cash surplus (shortage). When added to cash and equivalents - beginning historical balance, projected cumulative increase (decrease) in cash and equivalents yields cash and equivalents - end of period, which is the forecast ending balance in cash and equivalents.

On the forecast cash flow analysis statement this account measures the projected increase (decrease) in cash and cash equivalents for one year.

The cost of property, plant and equipment before accumulated depreciation is subtracted. Property, plant and equipment, also known as PP&E or fixed assets, consists of the infrastructure needed to support operations, including such items as land, buildings, manufacturing equipment, and furniture and fixtures.

A non-cash charge, which is included in selling, general and administrative expense, to write down operating receivables for that portion the collection of which is in doubt measured as a percentage of revenue from core operations.

See also: Provision for doubtful receivables incl. in SG&A

A non-cash charge, which is included in cost of revenue, to write down inventory that is slow-moving or obsolete measured as a percentage of revenue from core operations.

See also: Provision for impairment of inventory incl. in cost of revenue

Cash used in the repurchase of a company's own stock as carried on the company-reported indirect method statement of cash flows.

An unfinished research and development project that is acquired from another firm, either by direct purchase or through an acquisition. In an acquisition, a portion of the purchase price is attributed to purchased in-process research and development based on a determination of its fair value. On the cash flow analysis statement the account is used in computing other nonrecurring cash receipts (disbursements), a component of investment of sustainable free cash flow.

A contract that gives its holder the right to sell an asset, typically a financial instrument, at a specified price through a specified date.

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Abbreviation for Condensed Quarterly Balance Sheet.

Abbreviation for Quarterly Cash Flow Drivers Report.

Abbreviation for Condensed Quarterly Cash Flow Analysis Statement.

Abbreviation for Quarterly Financial Performance Report.

Abbreviation for Condensed Quarterly Statement of Income.

Option to purchase stock that provides the option holder with the right to postpone payment of any income taxes due on exercise of the option to the date on which the purchased stock is ultimately sold. The company issuing the option receives no tax deduction upon either the issue or exercise of the stock option.

Standardized and custom Cash Flow Analytics, LLC financial report formats designed to use quarterly data for individual quarters.

A Cash Flow Analytics, LLC report designed to highlight the factors driving core operating cash flow, sustainable operating cash flow, and sustainable free cash flow higher or lower over a quarter so that sustainability of those measures can better be assessed and expectations can be formed regarding a firm's ability to continue generating them.

A Cash Flow Analytics, LLC quarterly report designed to highlight key measures of financial performance separated into the categories of growth, profitability, activity, cash-flow profile, liquidity, leverage, coverage, dilution and valuation.

Standardized and custom Cash Flow Analytics, LLC financial report formats designed to use quarterly data for annual and interim periods covering four full quarters.

Standardized and custom Cash Flow Analytics, LLC financial report formats designed to use quarterly data for year-to-date interim periods.

Cash and assets that can be quickly converted to cash. It consists of cash and cash equivalents plus short-term investments and trading securities, plus operating receivables, tax refund receivable and current other notes receivable.

The extent to which quick assets cover current and operating working capital liabilities.

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Research and development expense as a percentage of revenue from core operations. In effect, the proportion of revenue from core operations spent on research and development during a reporting period.

See also: R&D to revenue %

Research and development expense as a percentage of revenue from core operations. In effect, the proportion of revenue from core operations spent on research and development during a reporting period.

See also: R&D expense / Revenue from core operations

Research and development expense as a percentage of revenue from core operations. In effect, the proportion of revenue from core operations spent on research and development during a reporting period.

See also: R&D %

An entity that may invest in real estate or mortgages on real estate and whose earnings are exempt from federal taxation. REITs must meet certain strict requirements contained in the Internal Revenue Code including distribution of at least 90% of their earnings to shareholders to avoid taxation of profit at the corporate level.

The reduction in tax cash payments, or the recovery of previous tax payments, that result from the deduction of option expense in the tax return.

Proceeds from the sale or securitization of accounts or notes receivable.

The number of days it would take to collect the ending balance in operating receivables at the year's average rate of revenue per day. Calculated by dividing 365 by receivables turnover.

See also: Operating receivables days

The number of times during a year that operating receivables are collected and replaced with new revenue transactions. Calculated by dividing revenue by ending operating receivables.

An adjustment to reported operating cash flow that moves a cash flow item from one classification to another, such as from operating cash flow to investing cash flow or from financing cash flow to operating cash flow. An example would be the reclassification of a tax benefit from stock options from operating cash flow to financing cash flow. The goal of these reclassifications is to produce a more sustainable measure of operating cash flow.

Option tax benefits that are recognized by additions to paid-in capital. These recognized benefits could equal, exceed, or fall short of the realized option tax benefits. A deferred tax asset is normally recorded for recognized benefits in excess of realized benefits. Alternatively, the deferred tax asset is reduced when the previously recognized excess benefits are realized.

Developed by J. Welles Wilder and introduced in his 1978 book, New Concepts in Technical Trading Systems, the Relative Strength Index (RSI) is an extremely useful and popular momentum oscillator. The RSI compares the magnitude of a stock's recent gains to the magnitude of its recent losses and turns that information into a number that ranges from 0 to 100. It takes a single parameter, the number of time periods to use in the calculation. In his book, Wilder recommends using 14 periods.

Wilder recommended using 70 and 30 as overbought and oversold levels respectively. Generally, if the RSI rises above 30 it is considered bullish for the underlying stock. Conversely, if the RSI falls below 70, it is a bearish signal. Some traders identify the long-term trend and then use extreme readings for entry points. If the long-term trend is bullish, then oversold readings could mark potential entry points.

Buy and sell signals can also be generated by looking for positive and negative divergences between the RSI and the underlying stock. For example, consider a falling stock whose RSI rises from a low point of (for example) 15 back up to say, 55. Because of how the RSI is constructed, the underlying stock will often reverse its direction soon after such a divergence. As in that example, divergences that occur after an overbought or oversold reading usually provide more reliable signals.

Cash that is generated from replenishable, non-depleting sources. The purchase and sale of inventory at a profit generates a renewable source of cash. The activity can be repeated. However, the purchase and sale of an investment generates an increment to cash only to the extent that the investment can be sold at a gain. Once the investment is sold, the ability to generate cash flow from the purchase and sale of an additional investment depends on the investment's uncertain change in price. Generally, when speaking of non-financial firms, such investing cash flow is not considered to be renewable. Similarly, cash provided by borrowed money, a financing activity, is not derived from a renewable source. Lenders may decide to stop loaning funds and funds provided must be repaid.

See also: Sustainable free cash flow

Recurring income received for the use of tangible and intangible corporate assets. On the cash flow analysis statement the account is used in computing other recurring cash receipts (disbursements), a component of cash flow available for debt service.

Capital expenditures required to replace productive capacity consumed during a reporting period.

Reported expenditures made in the purchase of long-term productive assets such as property, plant and equipment. It is measured net of cash received for related asset dispositions.

Reported capital expenditures measured as a percentage of revenue from core operations.

Cash disbursements, net of cash received, made for acquisitions during a period as reported in the investing section of a company-prepared cash flow statement. The amount is used as an indicator for potential disruptions to reported cash provided (used) by operating activities resulting from acquisitions.

See also: Cash paid for acquisitions

Cash flow from financing activities computed in accordance with generally accepted accounting principles as reported by the company.

See also: Cash provided or used by financing activities

Cash flow from investing activities computed in accordance with generally accepted accounting principles as reported by the company.

See also: Cash provided or used by investing activities

Cash flow from operating activities computed in accordance with generally accepted accounting principles as reported by the company. On the cash flow drivers report the account is used in computing ratios measuring cash-flow profile.

See also: GAAP operating cash flow; Reported operating cash flow

Quarterly, year-to-date cash flow from operating activities computed in accordance with generally accepted accounting principles as reported by the company. On the cash flow drivers report the account is used in computing ratios measuring cash-flow profile.

See also: GAAP operating cash flow; Reported operating cash flow

The change in inventory on the statement of cash flows as reported by the company. The account is used on the cash flow drivers report to measure the impact of acquisitions and other transactions, such as translation effects due to changes in currency exchange rates, on reported cash provided (used) by operating activities.

The quarterly, year-to-date change in inventory on the statement of cash flows as reported by the company. The account is used on the cash flow drivers report to measure the impact of acquisitions and other transactions, such as translation effects due to changes in currency exchange rates, on reported cash provided (used) by operating activities.

The change in payables and accruals on the statement of cash flows as reported by the company. The account is used on the cash flow drivers report to measure the impact of acquisitions and other transactions, such as translation effects due to changes in currency exchange rates, on reported cash provided (used) by operating activities.

The quarterly, year-to-date change in payables and accruals on the statement of cash flows as reported by the company. The account is used on the cash flow drivers report to measure the impact of acquisitions and other transactions, such as translation effects due to changes in currency exchange rates, on reported cash provided (used) by operating activities.

The change in receivables on the statement of cash flows as reported by the company. The account is used on the cash flow drivers report to measure the impact of acquisitions and other transactions, such as translation effects due to changes in currency exchange rates, on reported cash provided (used) by operating activities.

The quarterly, year-to-date change in receivables on the statement of cash flows as reported by the company. The account is used on the cash flow drivers report to measure the impact of acquisitions and other transactions, such as translation effects due to changes in currency exchange rates, on reported cash provided (used) by operating activities.

The as-reported version of the Earnings Quality Indicator.

See also: EQI™ Earnings Quality Indicator™

Cash flow available for common shareholders that can be used for such discretionary purposes as stock buybacks and dividends without affecting the firm's ability to grow and generate more. Calculated as reported operating cash flow less preferred dividends and reported capital expenditures. 

See also: Free cash flow

AS REPORTED. The capacity of a firm to generate sustainable free cash flow as it grows, reflecting a combination of its core operating growth profile, income taxes paid, capital expenditures and other investments needed to support operations, expressed as a percentage of revenue. It is measured as operating cushion % less operating working capital to revenue % less reported income taxes paid to revenue %, and less reported capital expenditures to revenue %. It is forward looking and reports the amount of sustainable free cash flow that can be expected for any measured amount of growth in revenue under the assumption that a firm's current mix of operating cushion, operating working capital, income taxes paid to revenue % and capital expenditures to revenue % remain unchanged. A firm with a positive free cash growth profile™ can grow operations and produce increasing amounts of sustainable free cash flow. A firm with a negative free cash growth profile™ will require other sources of cash to support revenue growth.

See also: Free cash flow; Free cash growth profile™

The percentage of revenue from core operations that results in reported free cash flow. Reported free cash flow is reported operating cash flow less preferred dividends and capital expenditures.

The company reported amount of earnings per diluted share on continuing operations. Continuing operations excludes discontinued operations, extraordinary items and the cumulative effects of changes in accounting principle.

After-tax net income before discontinued operations and extraordinary items, as reported by the company.

Cash disbursements for income taxes paid during the period.

See also: Income taxes (paid) recovered on continuing operations

Cash disbursements for income taxes paid during the period divided by revenue.

See also: Income taxes (paid) recovered on continuing operations; Reported income taxes paid

The incremental addition to reported net income contributed by an increase in revenue from core operations. It is measured as the change in reported net income divided by the change in revenue from core operations.

The incremental addition to reported net income from continuing operations contributed by an increase in revenue from core operations. It is measured as the change in reported net income from continuing operations divided by the change in revenue from core operations.

Cash disbursements for interest paid during the period, net of interest capitalized, as reported by the company.

The quarterly, year-to-date net capital expenditures on the statement of cash flows as reported by the company. The account is used on the cash flow drivers report to measure the impact of acquisitions and other transactions, such as translation effects due to changes in currency exchange rates, on reported cash provided (used) by operating activities.

Net capital expenditures on the statement of cash flows as reported by the company. The account is used on the cash flow drivers report to measure the impact of acquisitions and other transactions, such as translation effects due to changes in currency exchange rates, on reported cash provided (used) by operating activities.

Reported net income to revenue from core operations. The percentage of revenue from core operations that results in reported net income.

Reported net income from continuing operations to revenue from core operations. The percentage of revenue from core operations that results in reported net income from continuing operations.

Cash flow from operating activities computed in accordance with generally accepted accounting principles as reported by the company.

See also: GAAP operating cash flow; Reported cash provided (used) by operating activities

The percentage of revenue from core operations that results in reported operating cash flow without adjustment for nonrecurring or nonoperating items.

The current portion of long-term debt and capital lease obligations at the beginning of a year that is scheduled for payment during an ensuing year.

Expenditures incurred in the search for new knowledge with the expectation that it will be useful in the development of a new product or service or in the translation of research findings into a plan or design for a new product or service, whether intended for sale or use. Depreciation and amortization included in research and development expense is typically not disclosed and accordingly, research and development is measured after depreciation and amortization. On the cash flow analysis statement the account is used in computing research and development expense, a component of cash operating expense.

See also: R&D %

Research and development expense as a percentage of revenue from core operations. In effect, the proportion of revenue from core operations spent on research and development during a reporting period.

See also: R&D %

Cash set aside for a particular purpose either through a legal restriction related to a third party or through a more informal internal company restriction.

The estimated expense needed to effect a restructuring and/or the assimilation of an acquired entity. A reversal is a negative expense amount, effectively an increase to income, resulting from the reversal of a restructuring and merger-related charge that was previously accrued through a reduction in the restructuring and merger-related reserve. On the cash flow analysis statement the account is used in computing other nonrecurring cash receipts (disbursements), a component of investment of sustainable free cash flow.

A liability reflecting both restructuring costs and costs related to the assimilation of an acquired entity that were previously accrued but that are to be paid or realized in future periods. On the cash flow analysis statement the account is used in computing other nonrecurring cash receipts (disbursements), a component of investment of sustainable free cash flow.

Costs associated with restructuring activities, including the consolidation and/or relocation of operations or the disposition or abandonment of operations or productive assets. Such charges may be incurred in connection with a business combination, a change in an enterprise's strategic plan, or a managerial response to declines in demand, increasing costs, or other environmental factors.

A liability reflecting restructuring costs that were previously accrued but that are to be paid or realized in future periods.

An entity's accumulated earnings (losses) less dividends and other distributions. On the cash flow analysis statement, changes in the account, other than those caused by net income and dividends, are used in computing various components of financing transactions. Inc (Dec) in retained earnings for stock repurchases and conversions is used in computing common equity financing. Inc (Dec) in retained earnings for other equity transactions is used in computing other equity-related financing. Other increase (decrease) in retained earnings is used in computing financing transactions.

Retained earnings at the beginning of the current reporting period.

Retained earnings at the end of the current reporting period.

Abbreviation for Revenue Days Balance Sheet.

The proportion of revenue from core operations for the period covered by outstanding orders. It is calculated by dividing the outstanding orders by revenue from core operations.

A Cash Flow Analytics, LLC report designed to report all line items of the balance sheet measured in terms of revenue days, the number of days it would take to recover the item through revenue from core operations measured on a per-day basis using a 365-day year.

Revenue generated by core or central operations and excludes nonrecurring revenue or revenue or other income generated by non-core operations. Financial revenue, including interest income and revenue generated by a finance subsidiary, is also excluded. On the cash flow analysis statement the account is used in computing revenue from core operations, a component of cash from revenue.

The percentage change in revenue from core operations from one period to the next.

See also: Revenue from core operations growth; Revenue growth rate

The percentage change in revenue from core operations from one period to the next.

See also: Revenue from core operations % increase over previous year; Revenue growth rate

Revenue of a recurring nature generated by a non-core financial services subsidiary. It may be comprised of separately identified interest income or other financial services related fees such as commitment fees, commissions, or other fees for services provided. On the cash flow analysis statement the account is used in computing other recurring cash receipts (disbursements), a component of cash flow available for debt service.

A nonrecurring source of revenue arising from outside core or central operations. An example would be a short-lived stream of license fee revenue that is earned by a firm whose core revenue is generated by product sales.

A revenue stream that is not considered to be from core or central operations that is, nonetheless, considered to be generated by a recurring source. An example would be a separate, recurring stream of license fee revenue that is earned by a firm whose core revenue is generated by product sales. On the cash flow analysis statement the account is used in computing other recurring cash receipts (disbursements), a component sustainable operating cash flow.

The percentage change in revenue from core operations from one period to the next.

See also: Revenue from core operations growth

The percentage change in revenue from core operations from the same quarter the previous year and the current quarter.

See also: Revenue from core operations growth

The amount of revenue from core operations per employee. It is calculated by dividing revenue from core operations by the total number of employees at a firm.

The inclusion of an item of revenue, gain, expense, or loss in the tax return that has earlier been included in book earnings. Alternatively, the inclusion of a revenue, gain, expense, or loss in book earnings that has earlier been included in the tax return.

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A sale followed by the immediate leaseback of the asset sold by its previous owner.

The proceeds from the sale of an asset that is simultaneously leased back on an operating lease. Proceeds from assets sold and leased back under capital leases are included with long-term debt and capital lease financing.

The proceeds received by the company for issuing common or preferred stock.

Cash proceeds provided from the sale of investments as carried on the company-reported indirect method statement of cash flows.

Any realized gain or loss arising from the sale of  PP&E or investments. It is measured as the difference between the net proceeds from sale and the asset's balance sheet carrying value on the date of sale.

The proceeds from sale of PP&E, including any gain or loss on sale.

An Act of Congress signed into law on July 30, 2002 that tightened the oversight of firms that audit public companies, added criminal penalties for earnings management activities and took steps generally to improve company internal controls and corporate governance.

The Cash Flow Analytics Score™ and Earnings Quality Score™ measured for a four-quarters ending reporting period.

Natural ebbs and flows in business activity occurring annually that are caused by changes in the seasons.

The portion of accounts or notes receivable that has been sold through a securitization arrangement for the purpose of generating cash proceeds.

Net proceeds received from securitization interests granted on outstanding customer-related accounts receivable and notes receivable. This is a cash flow adjustment item. The amount is disclosed in the notes to the financial statements. On the balance sheet, securitization interests serve to gross up operating receivables and appear as a component of short-term debt. On the cash flow analysis statement the account is used in computing change in operating receivables, a component of cash from revenue, and in computing receivables-related financing, a component of financing transactions.

A financing arrangement where accounts receivable are pooled and an undivided interest in the receivables pool, which represents a claim on the entire pool of receivables, is sold, effectively creating a security that is backed by the receivables. It is accounted for as a sale of accounts receivable.

Expenses incurred in marketing and promoting a company's core products and services plus expenses incurred in administering core operations. Depreciation and amortization expense, if any, are included. On the cash flow analysis statement the account is used in computing selling, general and administrative expense (excl. depreciation & amortization), a component of cash operating expense.

Expenses incurred in marketing and promoting a company's core products and services plus expenses incurred in administering core operations, all measured before the non-cash expenses of depreciation and amortization of assets used in these activities and before other non-cash expenses such as non-cash compensation expense and the non-cash provision for doubtful receivables.

See also: SG&A (excl. depreciation and amortization) %

Selling, general and administrative expense (excluding depreciation & amortization) as a percentage of revenue from core operations. In effect, the proportion of revenue from core operations spent on selling, general and administrative expense during a reporting period, excluding the effects of depreciation and amortization expense.

See also: SG&A (excl. depreciation and amortization) %

Total borrowings, including both short-term and long-term amounts, excluding any subordinated borrowings.

The principal amount of borrowings that have a prior claim to other subordinated obligations in the event of liquidation of corporate assets. It is calculated by subtracting from total short-term and long-term borrowings the amount of noncurrent subordinated debt.

A measure of financial leverage calculated by dividing senior borrowings by total shareholders' equity. It measures the amount of senior borrowings for every dollar of shareholders' equity. Higher amounts denote higher financial leverage.

A measure of financial leverage calculated by dividing senior borrowings by tangible net worth. It measures the amount of senior borrowings for every dollar of tangible net worth. Higher amounts denote higher financial leverage.

Selling, general and administrative expense as a percentage of revenue from core operations. In effect, the proportion of revenue from core operations spent on selling, general and administrative expense during a reporting period. When the ratio is expressed in this manner, SG&A expense includes the effects of depreciation and amortization expense.

See also: SG&A expense / Revenue from core operations

Selling, general and administrative expense as a percentage of revenue from core operations. In effect, the proportion of revenue from core operations spent on selling, general and administrative expense during a reporting period. When the ratio is expressed in this manner, SG&A expense includes the effects of depreciation and amortization expense.

All ownership claims as reported on the balance sheet, including common equity and preferred equity. The measure includes common stock, preferred stock, additional paid-in capital, other shareholders' equity, retained earnings (deficit), accumulated other comprehensive income (loss) and is net stock held in (treasury). Mezzanine interests, if any, are excluded.

The percentage change in shareholders' equity from one period to the next.

The principal on debt obligations, including notes payable and other short-term obligations, that are classified as current liabilities, typically due within one year.

The balance sheet amount of borrowings that are due within one year or the operating cycle, whichever is longer. The balance consists of commercial paper, financing-related notes payable, other financing-related current liabilities, overdrafts payable and securitization interests outstanding on accounts receivable.

Debt financing that is due within one year or the operating cycle, whichever is longer. It consists primarily of commercial paper and financing-related notes payable but may also include financing provided through overdrafts payable and other financing-related current liabilities.

A source of use of cash arising from the sale or purchase of short-term investments as carried on the company-reported indirect method statement of cash flows.

Marketable securities and other short-term investments including those held for trading purposes. Included as part of investment of sustainable free cash flow.

Short-term investments measured in terms of revenue from core operations per day. Calculated as short-term investments divided by revenue from core operations measured on a daily basis using a 365-day year.

Marketable securities and other short-term investments, excluding those held for trading purposes. On the cash flow analysis statement the account is used in computing short-term investments and trading securities, a component of investment of sustainable free cash flow.

A Simple Moving Average (SMA) finds the average price of a security over a set number of periods. The calculation of the SMA is like the name suggests, simple. The mean of the underlying financial instrument is calculated over a period of time. Prices during this period area added and then divided by the total number of time periods. Every bar is thus given the same weighting.

Costs incurred in developing new software applications. Software development costs incurred in developing software for licensing to customers are capitalized once technological feasibility is reached.

Nonrecurring items of expense or loss that are not considered to be unusual and accordingly are not classified as extraordinary items. Examples include purchased in-process research and development, restructuring and merger-related charge, litigation charge, impairment charge on investments, impairment charge on PP&E, and impairment charge on goodwill and intangibles.

An entity established by a corporate sponsor to carry out a limited business activity on behalf of the sponsor. The sponsor need not consolidate the SPE provided the sponsor is not a controlling owner and the entity's equity is sufficient to absorb any expected losses that may be generated. A SPE is also known as a Variable Interest Entity (VIE).

The opening period in a company's life cycle during which operating losses are often reported and operating cash flow is consumed.

A Cash Flow Analytics, LLC report designed to show the results of profit-directed activities over a reporting period with a particular emphasis on sources of sustainable income. The statement highlights the results of core operations, including revenue from core operations, gross profit from core operations and operating profit from core operations, and the results of non-core operations, including other income (expense) recurring and other income (expense) nonrecurring.

A financial statement which details activity in various shareholders' equity accounts during a reporting period. Of particular interest for purposes of data entry for Cash Flow Analytics, LLC reports is activity in retained earnings for a reporting period, including dividends declared on preferred stock, dividends declared on common stock, increases or decreases in retained earnings for stock repurchases or conversions and increases or decreases in retained earnings for other equity transactions.

Input data for Cash Flow Analytics, LLC forecast reports derived from the statements of income and shareholders' equity.

Statements issued by the United Kingdom's Accounting Standards Committee. These standards were adopted by the Accounting Standards Board, which is the successor to the Accounting Standards Committee.

The income tax rates for different levels of taxable income found in the applicable income tax law.

Abbreviation for Statement of Income.

The dollar amount of common or preferred shares that have been issued and then repurchased and held by the issuing firm. It is a deduction from shareholders' equity. On the cash flow analysis statement the account is used in computing treasury stock transactions, a component of financing transactions.

The dollar amount of common or preferred shares that have been issued and then repurchased and held by the issuing firm. It is a deduction from shareholders' equity. On input assumptions for forecast analysis, stock held in treasury is entered without brackets.

A contract that gives its holder the right to buy (call option) or sell (put option) an interest in stock at a specified price through a specified date.

A contract, similar to an option, that gives its holder the right to buy stock at a specified price through a specified date. Warrants may be granted with the issue of other securities such as bonds or preferred stock, or may be granted with the issue of common stock, giving its holder the right to purchase additional shares. When granted as a form of compensation, stock warrants are more likely to be referred to as stock options.

See also: Parabolic Stop-and-Reversal (SAR)

Funds raised through debentures and other long-term debt that is subordinated to other senior sources of financing and through debt securities that are convertible into common equity.

Funds raised through debentures and other long-term debt that is subordinated to other senior sources of financing.

See also: Customer acquisition costs

Amounts due for shares issued. It is reported as a reduction in shareholders' equity and not as an asset. On the cash flow analysis statement the account is used in computing common equity financing, a component of financing transactions.

Sources of data for input to Cash Flow Analytics, LLC reports that come primarily from various sources in company prepared financial statements, including the statement of cash flows and the footnotes to the financial statements.

A worksheet that begins with reported operating cash flow and then adds and subtracts three different layers of nonrecurring operating cash flow items. Additions and subtractions are also made for reclassified operating cash flow items. Income tax adjustments are made where appropriate. Three different measures of sustainable cash flow are produced after the three different layers of adjustments have been recorded.

The percentage change in sustainable earnings from one period to the next.

See also: Sustainable earnings

The PEG ratio, or PE to growth, calculated using sustainable earnings per diluted share and the 3-year historical compound annual growth rate in sustainable earnings.

Sustainable earnings divided by the weighted average number of diluted common shares outstanding during the reporting period.

The percent earnings return generated by average total shareholders' equity during a period. Calculated by dividing sustainable earnings by average total shareholders' equity. Sustainable earnings are adjusted to exclude known items of nonrecurring revenue, gain, expense and loss.

Sustainable earnings per share divided by the closing market price.  It measures the percentage yield in terms of sustainable earnings on an investment at the closing market price. 

See also: Sustainable earnings

See also: Sustainable free cash flow

Sustainable cash flow available for common shareholders that can be used for such discretionary purposes as stock buybacks and dividends without affecting the firm's ability to grow and generate more. Calculated as sustainable operating cash flow less preferred dividends, net capital expenditures and other long-term assets needed to support operations.

See also: Sustainable operating cash flow

The percentage change in sustainable free cash flow from one period to the next.

The percentage change in sustainable free cash flow between the same quarter of the previous year and the current quarter.

The PEG ratio, or PE to growth, calculated using sustainable free cash flow per diluted share and the 3-year historical compound annual growth rate in sustainable free cash flow.

Sustainable free cash flow divided by the weighted average number of diluted common shares outstanding during the reporting period.

Sustainable free cash flow per share divided by the closing market price.  It measures the percentage yield in terms of sustainable free cash flow on an investment at the closing market price. 

See also: Sustainable free cash flow

Cash flow from operations after interest charges and income taxes that is derived from renewable sources, supported by profitable operations, and is calculated before capital expenditures and other long-term assets needed to support operations. Sustainable operating cash flow will typically differ from reported operating cash flow due to various nonoperating and/or nonrecurring items. The Cash Flow Analysis Statement adjusts for most of these items with entry of company-reported data from the statements of income and balance sheet. However, certain adjustments require additional manual data input. These adjustment items, found on the Statement of Income and Related Data Input spreadsheet, are labeled with an asterisk (*) and the letters (CF Adj). Note that with quarterly financial statements, data necessary for manual input are typically not available.

See also: CF Adj; Cash flow adjustment item

Cash flow from operations after interest charges and income taxes that is derived from renewable sources, supported by profitable operations, and is calculated before capital expenditures and other long-term assets needed to support operations. Sustainable operating cash flow will typically differ from reported operating cash flow due to various nonoperating and/or nonrecurring items. The Cash Flow Analysis Statement adjusts for most of these items with entry of company-reported data from the statements of income and balance sheet. However, certain adjustments require additional manual data input. These adjustment items, found on the Statement of Income and Related Data Input spreadsheet, are labeled with an asterisk (*) and the letters (CF Adj). Note that with quarterly financial statements, data necessary for manual input are typically not available.  Note that this forecast measure of sustainable operating cash flow includes interest income (expense) on projected cash surpluses or shortages.

A coverage ratio that measures the number of times that sustainable operating cash flow, which is cash flow available for the payment of dividends, covers dividends on preferred stock.

The percentage change in sustainable operating cash flow from one period to the next.

The percentage change in sustainable operating cash flow between the same quarter of the previous year and the current quarter.

The PEG ratio, or PE to growth, calculated using sustainable operating cash flow per diluted share and the 3-year historical compound annual growth rate in sustainable operating cash flow.

Sustainable operating cash flow divided by the weighted average number of diluted common shares outstanding during the reporting period.

Sustainable operating cash flow per share divided by the closing market price.  It measures the percentage yield in terms of sustainable operating cash flow on an investment at the closing market price. 

See also: Sustainable operating cash flow

Items of income or (expense) that are from sources other than core operations, consisting of interest income, dividend income, rental and royalty income, equity method income (loss), interest expense, minority interest in (income) loss, and other income (expense) - recurring. These source of income or (expense) are considered to be sustainable, though their growth may not be at a rate that is commensuratae with the rate of growth in core operations.

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Tangible assets less total liabilities. It is calculated as shareholders' equity less goodwill and acquisition-related intangibles, net.

A tax refund due from a taxing authority for income taxes paid in excess of amounts currently payable or as the result of the utilization of an operating loss or tax credit carryback. On the cash flow analysis statement the account is used in computing income taxes (paid) recovered on continuing operations, a component of cash flow available for debt service.

See also: Income tax refund receivable

Tax refund receivable as a percentage of income before income taxes. In effect, the proportion of income before income taxes carried in a tax refund receivable as of the end of a reporting period.

See also: Tax refund receivable

Tax refund receivable as a percentage of income before income taxes. In effect, the proportion of income before income taxes carried in a tax refund receivable as of the end of a reporting period.

See also: Tax refund receivable

Income as measured on a corporation's tax return reflecting taxable revenues and gains less permitted tax deductions. Taxable income for a reporting period is used in computing the amount of income taxes due and payable for that period.

Temporary differences that, upon their reversal, increase taxable income. The initial tax effects of these temporary differences are recorded as deferred tax liabilities.

A difference between the book and tax basis of both assets and liabilities. Alternatively, a temporary difference is a difference between book and tax return earnings that will reverse at some future point in time. Temporary differences give rise to deferred tax assets and liabilities.

The total of all assets, including current and operating working capital assets and noncurrent assets, as reported on the balance sheet.

Total assets measured in terms of revenue from core operations per day. Calculated as total assets divided by revenue from core operations measured on a daily basis using a 365-day year.

Total assets measured in terms of revenue from core operations per day. Calculated as total assets divided by revenue from core operations measured on a daily basis using a 365-day year.

The three-year compound average growth rate (or average rate of change) in total assets days.

The percentage change in total assets from one period to the next.

The change in reported cash and cash equivalents during a reporting period.

The total cash paid on debt service during a period consisting of total interest paid plus required principal payments on long-term debt and capital lease obligations.

Interest obligations that accrue during a period, including interest expensed that period plus interest capitalized to PP&E and interest capitalized to inventory.

Total cash payments for interest on debt and capital eases, including capitalized interest, measured as a percentage of average interest-bearing borrowings.

See also: Total interest paid

The total of all obligations, including current and noncurrent, operating-related and financing-related, as reported on the balance sheet. Mezzanine interests, if any, are excluded.

A measure of financial leverage calculated by dividing total liabilities by total shareholders' equity. It measures the amount of total liabilities for every dollar of shareholders' equity. Higher amounts denote higher financial leverage.

A measure of financial leverage calculated by dividing total liabilities by tangible net worth. It measures the amount of total liabilities for every dollar of tangible net worth. Higher amounts denote higher financial leverage.

The sum of total liabilities, mezzanine interests, and shareholders' equity. The sum will equal total assets.

The percentage change in total liabilities from one period to the next.

Realized and unrealized gains or losses generated by short-term investments classified as trading securities. On the cash flow statement (indirect method), the account balance is removed from Income (loss) from continuing operations in the computation of sustainable operating cash flow.

A variant on the cash cycle consisting of operating receivables, inventory and operating payables measured in terms of revenue from core operations per day. Calculated as operating receivables plus inventory and operating payables divided by revenue from core operations measured on a daily basis using a 365-day year.

Realized and unrealized gains (losses) generated by short-term investments classified as trading securities. On the cash flow analysis statement the account is used in computing short-term investments and trading securities, a component of investment of sustainable free cash flow.

Marketable debt or equity securities bought and held for sale in the near term to generate income on short-term price changes. On the cash flow analysis statement the account is used in computing short-term investments and trading securities, a component of investment of sustainable free cash flow.

Net income plus depreciation and amortization.

A corporation's issued stock that has subsequently been repurchased by the company and not retired.

Cash paid or received for purchases or sales of treasury stock.

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Cost plus profit recognized on contracts in excess of amounts billed customers.

See also: Cost + profit in excess of billings

See also: Deferred revenue

A cash flow statement, often used by lenders and credit analysts, that highlights sources and uses of cash to facilitate analysis. Uniform Credit Analysis™ and (UCA)™ are registered trademarks of the Risk Management Association, Philadelphia, Pennsylvania.

On the cash flow statement (indirect method), an adjustment to Income (loss) from continuing operations to remove the non-cash component of equity method income in the computation of sustainable operating cash flow.

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Performance measures focused on analyzing the relationship of market price to various measures of earnings and cash flow.

Amounts owed vendors for purchased goods or services, reported as accounts payable.

The Volatility indicator, developed by Marc Chaikin, measures the trading range between an instrument's high and low for each period. The Exponential Moving Average of the difference between the period's high and low is first calculated (instead of the traditional period close). Then the Rate of Change of that moving average is taken, which represents an oscillator that measures volatility. A positive result indicates increasing volatility, whereas negative values signals decreasing volatility.

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The Williams %R, developed by Larry Williams, is used to measure whether or not a security is overbought or oversold. The indicator is designed to show the relationship between the period high and the current close within the specified period. The %R is plotted on an upside down scale with 0 at the top and -100 at the bottom.

Current assets minus current liabilities.