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 to revenue % 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.
Accum amortization, goodwill and acquisition-related intangibles 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.
Accum Other Comp Inc - Cumulative Translation Adjustments A component of the shareholders' equity account, accumulated other comprehensive income, that derives from foreign currency translation adjustments.
Accum Other Comp Inc - Derivatives Unrealized Gain/Loss A component of the shareholders' equity account, accumulated other comprehensive income, that derives from derivatives-related transactions and cash-flow hedges.
Accum Other Comp Inc - Marketable Security Adjustments 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.
Accum Other Comp Inc - Min Pension Liab Adj 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.
Accum Other Comp Inc - Other Adjustments 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.
Accum Other Comp Inc - Unreal G/L Ret Int in Sec 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.
Accum other comprehensive income (loss) from investments 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.
Accumulated benefit obligation 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.
Accumulated depreciation The cumulative amount by which property, plant and equipment has been expensed through depreciation through time.
Accumulated depreciation / Property, plant and equipment, gross 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.
Accumulated depreciation, PP&E 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.
Accumulated other comprehensive income (loss) 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.
Acquisitions The cash paid in acquiring another business entity.
Acquisitions-related intangibles Intangible assets, other than goodwill, arising as a result of an acquisition. Examples include patents, trademarks, brands, customer lists and non-compete agreements.
Activity (in revenue days) 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.
Actual change in cash and equivalents A term used on the cash flow analysis statement that consists of the change in cash and cash equivalents between reporting periods.
Additional minimum pension liability 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.
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. 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.
Adj. for income taxes paid (recovered) on material non-operating gains or losses 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).
Adjusted EBITDA 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.
Adjusted operating cash flow 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
Allowance for doubtful receivables The amount of outstanding receivables, including accounts receivable and 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 accounts receivable and/or notes receivable.
Allowance for doubtful receivables / Operating receivables, gross The percentage of outstanding operating receivables that are deemed to be uncollectible. It is calculated by dividing the allowance for doubtful receivables by operating receivables before the allowance for doubtful receivables is subtracted.
Alternative minimum tax (AMT) A tax beyond that computed under the regular income tax system. Various adjustments are made to regular taxable income, e.g., the excess of accelerated over straight-line depreciation, to arrive at alternative minimum taxable income. A preliminary tax is then computed on this revised earnings number using the AMT tax rate of 20%. If the AMT tax exceeds the regular tax, then this higher amount must be paid. Once paid, the additional tax beyond that under the regular system may be carried forward without limit. This AMT carryforward can reduce tax payments in future years when the regular tax exceeds the AMT tax.
Amortization expense on acquisition-related intangibles Non-cash amortization expense calculated on intangibles added as part of a corporate acquisition. Amortization expense is no longer computed on goodwill. Amortization expense on acquisition-related intangibles is computed by taking the change in accumulated amortization on acquisition-related intangibles. In computing capital expenditures it is subtracted from depreciation and amortization incl. in cost of revenue and in SG&A.
Amortization period for capitalized debt issue costs (in years, set >0) On the forecast financial statements, the assumed period over which capitalized debt issue costs, when they exist, are to be amortized. The amortization period must be set at an amount greater than zero. A typical amortization period is 5 years.
Analysis of Core Operating Cash Flow A summary of the cash impact of growth and the cash impact of changes in operating cushion and operating working capital days on core operating cash flow.
Analysis of income taxes before adj for taxes on material non-operating gains or losses and excluding tax benefits from stock options An identification of the cash flow drivers and the cash impacts affecting income taxes (paid) recovered before any adjustment is made for material non-operating gains or losses and before the inclusion of any tax benefits from stock options.
Analysis of Income Taxes Paid A summary of the cash impact of growth and the cash impact of changes in the tax cash-flow profile on income taxes paid.
Annual templates Standardized and custom Cash Flow Analytics, LLC financial report formats designed to use annual data.
Annualized aftertax sustainable earnings return on average assets Sustainable earnings divided by average total assets for a quarter, expressed as an annual rate.
Annualized pretax sustainable earnings return on average assets The percent pretax earnings return generated by average total assets during a period. For quarterly financial statements, it is calculated by dividing annualized pretax sustainable earnings by average total assets. Pretax sustainable earnings are adjusted to exclude known items of nonrecurring revenue, gain, expense and loss.
Annualized sustainable earnings return on average equity The percent earnings return generated by average total shareholders' equity during a period. For quarterly financial statements it is calculated by dividing annualized sustainable earnings by average total shareholders' equity. Sustainable earnings are adjusted to exclude known items of nonrecurring revenue, gain, expense and loss.
As % of cash flow available for debt service Measured cash impacts divided by cash flow available for debt service.
As % of cash flow available for investment Measured cash impacts divided by cash flow available for investment.
As % of core operating cash flow Measured cash impacts divided by core operating cash flow.
Assets and Liabilities - Other (Net Change) The period-to-period increase or decrease in other operating assets and liabilities not classified as accounts receivable, inventory, accounts payable or accrued liabilities.
Assumed disbursement period for restructuring and merger-related reserve (in years, set >0) Input data for Cash Flow Analytics, LLC forecast reports. The item measured the period over which a restructuring and / or a merger-related reserve, if any, will be settled The assumed period must be set greater than zero.
Available-for-sale security A default classification for an investment in a debt or equity security that is not classified as either a held-to-maturity security or a trading security.
Average diluted shares outstanding The weighted average number of diluted common shares outstanding during a reporting period.
Average diluted shares outstanding during period / Avg. basic shares outstanding A measure of potential future dilution of average basic shares outstanding through the issue of additional common shares resulting from option exercises and conversions of convertible securities.
Average diluted shares outstanding growth The percentage change in the average diluted shares outstanding from one period to the next. The measure is one indication of the effects of dilution through the issue of additional common shares.
Average exercise price on options exercised during period / Closing market price An approximation of the per-share discount received by purchasers of common stock as a result of options exercised during the period.
Average exercise price on options granted during period / Closing market price An approximation of the per-share discount to be received by recipients of options during the period based on the current market price.
Average exercise price on options outstanding / Closing market price An approximation of the per-share discount to be received by holders of options based on the current market price.
Average interest-bearing borrowings The average principal amount during a 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 balance plus ending balance of all interest-bearing borrowings.
Average preferred stock The average amount of issued preferred stock during a period. Calculated by dividing two into the sum of the beginning balance plus ending balance of preferred stock.
Average useful life of property, plant and equipment (yrs) The depreciation period used for property, plant and equipment. A high or increasing average useful life of property, plant and equipment could indicate that a firm is taking longer than it should to depreciate property, plant and equipment, potentially overstating earnings and leaving reported amounts of property, plant and equipment at risk for an impairment charge. It is computed by finding the reciprocal of the depreciation rate, that is, 1 divided by the depreciation rate.
Avg. basic shares outstanding during period The weighted average number of basic common shares outstanding during a reporting period.
Avg. diluted shares outstanding during period The weighted average number of diluted common shares outstanding during a reporting period. On the cash flow analysis statement the account is used in computing sustainable operating cash flow per diluted share and sustainable free cash flow per diluted share.
Avg. exercise price per share on options granted The average exercise price per share on options granted during the period. On the financial performance report, the account is used in calculating ratios measuring dilution.
Avg. exercise price per share on options outstanding The average exercise price per share on options outstanding at period end. On the financial performance report, the account is used in calculating ratios measuring dilution.
Avg. exercise price per share received for options exercised (CF Adj) The average exercise price per share received on 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.
Avg. price paid for common shares repurchased The average price paid for common shares repurchased during a period. The model automatically calculates the amount by dividing cash paid for common shares repurchased during period by the no. of common shares repurchased during period. 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).
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Calculated average diluted shares outstanding The weighted average number of diluted common shares outstanding during a reporting period.
Calculated net income (loss) 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.
Calculated to reported capital expenditures 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.
Calculated to reported change in inventory 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.
Calculated to reported change in payables and accruals 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.
Calculated to reported change in receivables 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.
Calculation of income taxes (paid) recovered 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.
Call option A contract that gives its holder the right to buy an asset, typically a financial instrument, at a specified price through a specified date.
Capital expenditures 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 investment to revenue % 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
Capital expenditures cash-flow profile 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.
Capital expenditures equivalent of (additions) to operating leases The net (increase) in the capitalized value of operating leases, which serves as a proxy for the capital expenditures equivalent of new operating leases.
Capital Expenditures Profile: 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.
Capital expenditures to depreciation on property, plant and equipment 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 to revenue % 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.
Capital lease 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.
Capitalize into perpetuity at 12.5% An estimate of the present value of operating leases calculated dividing the current rent expense by the discount rate of 12.5%.
Capitalized debt-issue costs 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.
Capitalized interest 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.
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: CF Adj
Cash flow analysis The search for the fundamental drivers that underlie a company's cash flow stream and affect its sustainability.
Cash Flow Analysis Statement 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.
Cash Flow Analytics Score™ 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.
Cash Flow Analytics Score™ (Four Quarters Ending) The Cash Flow Analytics Score™ measured for a four-quarters ending reporting period.
Cash flow available for debt service 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.
Cash flow available for debt service / (Interest paid + Required principal payments) 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.
Cash flow available for debt service / Interest paid 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 debt service growth rate The percentage change in cash flow available for debt service from one period to the next.
Cash flow available for debt service growth rate (over same quarter previous year) The percentage change in cash flow available for debt service from the same quarter the previous year to the current quarter.
Cash flow available for debt service to total debt service requirements 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.
Cash flow available for debt service to total interest paid 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 investment 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.
Cash flow available for investment / Investment to support operations 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.
Cash flow available for investment growth rate The percentage change in cash flow available for investment from one period to the next.
Cash flow available for investment growth rate (over same quarter previous year) The percentage change in cash flow available for investment between the same quarter of the previous year and the current quarter.
Cash Flow Drivers - Four Quarters Ending 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.
Cash Flow Drivers Report 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.
Cash flow growth profile™ 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.
Cash flow per diluted common share A cash flow measure divided by the diluted number of common shares outstanding during a reporting period.
Cash Flow Snapshot 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.
Cash flow snapshot 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.
Cash flow statement and other sources Sources of data for input to Cash Flow Analytics, LLC reports that come primarily from a company prepared statement of cash flows.
Cash Flow Summary A summary of the components of Sustainable free cash flow.
Cash Flow Summary - Four Quarters Ending A summary of the components of Sustainable free cash flow for a four-quarters ending reporting period.
Cash flow sustainability™ 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 from revenue 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 gross margin Cash from revenue minus cash cost of revenue. It is a cash-based measure of gross profit.
Cash impact of change in accruals days The measured effects of the change in accruals days on the change in accruals from one period to the next.
Cash impact of change in capitalized operating expenses days The measured effects of the change in capitalized operating expenses days on the change in capitalized operating expenses from one period to the next.
Cash impact of change in deferred revenue days The measured effects of the change in deferred revenue days on the change in deferred revenue from one period to the next.
Cash impact of change in GM % The measured effects of the change in gross margin % on the change in gross margin (excl. depreciation & amortization) from one period to the next.
Cash impact of change in gross margin % The measured effects of the change in gross margin % on the change in gross margin (excl. depreciation & amortization) from one period to the next.
Cash impact of change in inventory days The measured effects of the change in inventory days on the change in inventory (incl. capitalized interest) from one period to the next.
Cash impact of change in operating cushion % The measured effects of the change in operating cushion % on the change in operating cushion from one period to the next.
Cash impact of change in operating receivables days The measured effects of the change in operating receivables days on the change in operating receivables from one period to the next.
Cash impact of change in operating working capital days The measured effects of the change in operating working capital days on the change in operating working capital from one period to the next.
Cash impact of change in payables days The measured effects of the change in payables days on the change in payables from one period to the next.
Cash impact of change in prepaids days The measured effects of the change in prepaids days on the change in prepaids from one period to the next.
Cash impact of change in R&D % The measured effects of the change in R&D % on the change in research and development expense from one period to the next.
Cash impact of change in receivables days The measured effects of the change in receivables days on the change in operating receivables from one period to the next.
Cash impact of change in SG&A % 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.
Cash impact of changes in operating cushion 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.
Cash impact of chgs in capex and investment to revenue % on capex 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.
Cash impact of chgs in capex to revenue % on capex The measured effects of changes in capital expenditures to revenue % on the change in capital expenditures from one period to the next.
Cash impact of chgs in investment in ops-related intangibles to revenue % 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.
Cash impact of chgs in investment in other ops-related assets to revenue % 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.
Cash impact of chgs in operating cushion & operating working capital days 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.
Cash impact of growth The total measured effects of growth in revenue from core operations on various cash flow drivers.
Cash impact of growth and chgs in capex to revenue % on capex 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.
Cash impact of growth and chgs in investment in ops-related intangibles to revenue % 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.
Cash impact of growth and chgs in investment in other ops-related assets to revenue % 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.
Cash impact of growth and chgs in op. cushion and op. working capital days 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.
Cash impact of growth on accruals The measured effects of growth in revenue from core operations on the change in accruals from one period to the next.
Cash impact of growth on capex The measured effects of growth in revenue from core operations on the change in capital expenditures from one period to the next.
Cash impact of growth on capex and investment 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.
Cash impact of growth on capital expenditures The measured effects of growth in revenue from core operations on the change in capital expenditures from one period to the next.
Cash impact of growth on capitalized operating expenses The measured effects of growth in revenue from core operations on the change in capitalized operating expenses from one period to the next.
Cash impact of growth on deferred revenue The measured effects of growth in revenue from core operations on the change in deferred revenue from one period to the next.
Cash impact of growth on gross margin The measured effects of growth in revenue from core operations on the change in gross margin from one period to the next.
Cash impact of growth on inventory The measured effects of growth in revenue from core operations on the change in inventory from one period to the next.
Cash impact of growth on investment in ops-related intangibles 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.
Cash impact of growth on investment in other ops-related assets 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.
Cash impact of growth on operating cushion The measured effects of growth in revenue from core operations on the change in operating cushion from one period to the next.
Cash impact of growth on operating payables The measured effects of growth in revenue from core operations on the change in operating payables from one period to the next.
Cash impact of growth on operating receivables The measured effects of growth in revenue from core operations on the change in operating receivables from one period to the next.
Cash impact of growth on operating working capital The measured effects of growth in revenue from core operations on the change in operating working capital from one period to the next.
Cash impact of growth on other ops-related assets 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.
Cash impact of growth on prepaids The measured effects of growth in revenue from core operations on the change in prepaids from one period to the next.
Cash impact of growth on R&D The measured effects of growth in revenue from core operations on the change in R&D from one period to the next.
Cash impact of growth on SG&A The measured effects of growth in revenue from core operations on the change in SG&A from one period to the next.
Cash impact on capital expenditures The measured effects of growth in revenue from core operations and changes in capital expenditures to revenue % on capital expenditures.
Cash impact on investment in operations-related intangibles 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.
Cash impact on investment in other ops-related assets 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.
Cash impacts on accruals 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.
Cash impacts on capitalized operating expenses 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.
Cash impacts on deferred revenue 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.
Cash impacts on gross margin (excl. depreciation & amortization) 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.
Cash impacts on inventory 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.
Cash impacts on operating cushion 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.
Cash impacts on operating payables 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.
Cash impacts on operating receivables 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.
Cash impacts on operating working capital 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.
Cash impacts on prepaids 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.
Cash impacts on research and development 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.
Cash impacts on SG&A (excl. depreciation & amortization) 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 operating expense 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.
CF Adj 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
CF Drivers Abbreviation for Cash Flow Drivers Report.
CFA Score™ 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.
CFA Score™ (Four Quarters Ending) The Cash Flow Analytics Score™ measured for a four-quarters ending reporting period.
CFA Stmts Abbreviation for Cash Flow Analysis Statement.
Change in accounting principle (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
Change in accounting principle gain (loss) 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.
Change in accruals 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
Change in accum other comprehensive income (loss) from investments 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.
Change in accumulated other comprehensive income A term used on the cash flow analysis statement that refers to the change in accumulated other comprehensive income between reporting periods.
Change in additional minimum pension liability A source or (use) of cash arising from the period-to-period increase or decrease in the additional minimum pension liability.
Change in balance sheet adjustment 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.
Change in capitalized debt-issue costs 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.
Change in capitalized operating expenses 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
Change in cash and equivalents 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.
Change in cash and equivalents after financing 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.
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
Change in common equity 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.
Change in deferred revenue 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
Change in deferred tax assets 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
Change in deferred tax assets to income before income taxes (On the change in 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.
Change in deferred tax liabilities 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
Change in deferred tax liabilities to income before income taxes (On the change in 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.
Change in dividends payable 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.
Change in effective tax rate (On the change in income tax (expense) benefit) 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.
Change in goodwill and acquisition-related intangibles, net 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.
Change in gross margin (excl. depreciation and amortization) 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.
Change in income tax (expense) benefit 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.
Change in income taxes payable 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
Change in income taxes payable to income before income taxes (On the change in 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.
Change in intangible pension asset The (use) or source of cash arising from an increase or decrease in an intangible asset related to a company's pension plan.
Change in interest payable 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.
Change in inventory 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)
Change in 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.
Change in inventory on balance sheet 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)
Change in inventory on cash flow analysis statement 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)
Change in investments in other assets 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.
Change in leverage 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.
Change in long-term financing obligations 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.
Change in long-term investments 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.
Change in minority interest in equity 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.
Change in net assets of discontinued operations 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.
Change in operating cushion 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
Change in operating payables 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
Change in operating receivables 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
Change in operating receivables before provision for writedown of 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.
Change in operating receivables on balance sheet 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.
Change in operating receivables on cash flow analysis statement 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
Change in operating working capital 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
Change in other mezzanine interests 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.
Change in other operations-related liabilities A source or (use) of cash resulting from an increase or decrease in other unidentified operations-related liabilities.
Change in prepaids 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
Change in property, plant and equipment, net 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
Change in research and development expense 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.
Change in restructuring and merger-related reserve The source or (use) of cash resulting from an increase or decrease in a restructuring or merger-related reserve liability.
Change in SG&A expense (excl. depreciation and amortization) 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.
Change in short-term investments and trading securities 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.
Change in tax refund receivable 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
Change in tax refund receivable to income before income taxes (On the change in 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.
Changes in Current Debt Sources or (uses) of cash from issuing or repaying short-term debt as carried on the company-reported indirect method statement of cash flows.
Closing market price per share of common stock The closing price on the last day of trading for the current period. Closing price is used in computing ratios measuring valuation.
Commercial paper and financing-related notes payable 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.
Common dividends declared The dollar amount of dividends declared on common stock during the reporting period.
Common equity 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.
Common equity financing Net proceeds from the issue of common stock. Changes in deferred compensation and subscription notes receivable are included in this caption.
Common equity-related financing 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.
Common Size Balance Sheet A Cash Flow Analytics, LLC report designed to show all line items of the balance sheet measured as a percentage of total assets.
Common Size Cash Flow Analysis Statement 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.
Common Size Statement of Income 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.
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. 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.
Common stock and additional paid-in capital 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.
Common stock dividend paid in stock 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.
Company reported cash flows: 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.
Company reported net income (loss) 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.
Condensed Quarterly Balance Sheet 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.
Condensed Quarterly Cash Flow Analysis Statement 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.
Condensed Quarterly Cash Flow Analysis Statement Supporting Detail Calculations supporting amounts reported on the quarterly cash flow analysis statement.
Condensed Quarterly Statement of Income 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 cash margin™ CCM™
Core operating cash flow 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.
Core operating cash flow (in revenue days) Input data for Cash Flow Analytics, LLC forecast reports that relate to operating working capital assets and liabilities and determine a forecast cash cycle.
Core operating cash flow growth rate The percentage change in core operating cash flow from one period to the next.
Core operating cash flow growth rate (over same quarter previous year) The percentage change in core operating cash flow between the same quarter the previous year and the current quarter.
Core operating growth profile™ 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.
Creative cash flow reporting 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
CS.BS Abbreviation for Common Size Balance Sheet.
CS.CFA Abbreviation for Common Size Cash Flow Analysis Statement.
CS.Inc Abbreviation for Common Size Income Statement.
Cumulative effect of a change in accounting principle The cumulative prior-year income effect of a change from one generally accepted accounting principle to another.
Current accrued expenses payable 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
Current and operating working capital assets 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.
Current and operating working capital liabilities 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.
Current assets 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 discontinued operations 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.
Current capitalized operating expenses 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
Current customer-related notes receivable, net Amounts due from customers as a result of delivering goods or services that is represented by a more formal credit arrangement than open credit granted in the ordinary course of business and 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
Current deferred revenue 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
Current deferred tax liabilities Future tax obligations that result from the origination of taxable temporary differences. When they originate, these temporary differences cause pretax book income to exceed taxable income. These future tax obligations are later paid when temporary differences reverse, now causing taxable income to exceed pretax book income. The current classification arises from the fact that these deferred tax liabilities arise from balance-sheet items that are classified as current, such as a current asset that is being amortized more rapidly for tax purposes than book purposes or an installment note receivable. 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.
Current deferred tax liabilities to income before income taxes 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
Current financing-related 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.
Current income tax provision 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.
Current liabilities Liabilities expected to be repaid or otherwise settled within one year or the operating cycle, whichever is longer.
Current liabilities of discontinued operations 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.
Current other notes receivable 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
Current portion, capital lease obligations 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.
Current portion, long-term debt 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.
Current portion, long-term debt & capital lease obligations Principal on long-term debt and capital lease obligations that is due and payable within one year.
Current prepaid expenses 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
Current ratio (current and oper. working capital assets to current and oper. working capital liabilities) 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.
Current tax-related assets Tax-related assets generally expected to be realized within one year consisting of a tax refund receivable and current deferred tax assets.
Current tax-related liabilities Tax-related liabilities generally expected to be paid within one year consisting of income taxes payable and current deferred tax liabilities.
Current vendor-related notes payable 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
Depreciation and amortization incl. in SG&A 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. Depreciation and amortization incl. in SG&A may be disclosed on the statement of cash flows or in a footnote to the financial statements. 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 capital expenditures, a component of investment to support operations.
Depreciation and amortization incl. in SG&A (YTD) Quarterly, year-to-date 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. Depreciation and amortization incl. in SG&A may be disclosed on the statement of cash flows or in a footnote to the financial statements. 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 capital expenditures, a component of investment to support operations.
Depreciation and amortization incl. in SG&A as % 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: Depreciation and amortization incl. in SG&A
Depreciation expense on property plant and equipment The periodic amount of depreciation expense calculated on property, plant and equipment.
Depreciation proxy for replacement capital expenditures Depreciation and amortization of property, plant and equipment used in operations that serves as an approximation of the cost of replacing that portion of property, plant and equipment consumed by operations during a reporting period.
Depreciation rate The percentage that property, plant and equipment is depreciated during a period. A low or declining depreciation rate could indicate that a firm is taking longer than it should to depreciate property, plant and equipment, potentially overstating earnings and leaving reported amounts of property, plant and equipment at risk for an impairment charge. It is computed by dividing depreciation expense for a period by average property, plant and equipment, gross.
Diluted EPS effects of change in effective tax rate The earnings impact on EPS of the change in the effective tax rate from one period to the next.
Diluted EPS effects of change in gross margin The earnings impact on EPS of the change in gross margin % from one period to the next.
Diluted EPS effects of change in R&D expense ratio The earnings impact on EPS of the change in the R&D expense ratio, or R&D expense / Revenue from core operations, from one period to the next.
Diluted EPS effects of change in SG&A expense ratio The earnings impact on EPS of the change in the SG&A expense ratio, or SG&A expense / Revenue from core operations, from one period to the next.
Diluted EPS effects of change in SGA expense ratio The earnings impact on EPS of the change in the SG&A expense ratio, or SG&A expense / Revenue from core operations, from one period to the next.
Diluted EPS from continuing operations Income (loss) from continuing operations for a period divided by the weighted average number of diluted common shares outstanding during that period.
Diluted EPS from continuing operations growth The percentage change in diluted EPS from continuing operations from one period to the next.
Dilution Reduction in shareholders' equity per share or earnings per share that arises from some changes among shareholders' proportionate interests.
Direct response advertising Advertising designed to elicit sales to customers who can be shown to have responded specifically to the advertising in the past. Such costs can be capitalized when persuasive historical evidence permits formulation of a reliable estimate of the future revenue that can be obtained from incremental advertising expenditures.
Direct-method format A format for the operating section of a cash flow statement prepared in accordance with generally accepted accounting principles that reports actual cash receipts and cash payments from operating activities.
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 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
Disposition of 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.
Distributions from associated companies Dividends received from investee companies in which the investor has sufficient ownership to exert significant influence.
Dividend income 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.
Dividend payout (Dividends on common stock / Sustainable earnings) 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 - preferred Dividends paid in cash on preferred stock.
Dividends declared - common 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.
Dividends declared - preferred 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.
Dividends on common stock 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.
Dividends on common stock paid in cash (YTD) 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 on preferred as % of average outstanding preferred equity Dividends paid in cash on preferred stock measured as a percentage of average outstanding preferred stock.
Dividends on preferred stock Dividends paid in cash on preferred stock.
Dividends on preferred stock as % of cash flow available for investment Dividends paid in cash on preferred stock measured as a percentage of cash flow available for investment.
Dividends on preferred stock paid in cash (current qtr) The dollar amount of cash dividends paid on preferred stock during the current quarter.
Dividends on preferred stock paid in cash (YTD) 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 payable 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.
Dividends received from equity method investments 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.
Dividends received from equity method investments (YTD) 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.
Drivers of Capital Expenditures 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
Drivers of Core Operating Cash Flow: 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.
Drivers of Income Taxes Paid: 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.
Drivers of Sustainable Free Cash Flow: 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 before depreciation and amortization (EBDA) Earnings measured before depreciation and amortization. May be considered as earnings available for the required payment of principal on debt.
Earnings before interest and taxes (EBIT) Net income measured before interest expense and before income tax expense.
Earnings before interest, depreciation and amortization (EBIDA) Earnings measured before interest expense, depreciation and amortization. May be considered as earnings available for the payment of interest and required principal on debt.
Earnings before interest, taxes, depreciation and amortization (EBITDA) 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.
Earnings before interest, taxes, depreciation, amortization and rents (EBITDAR) EBITDA measured before rent expense on operating leases. May be considered as earnings available for the payment of interest, taxes and rents.
Earnings Quality Indicator™ EQI™
Earnings sustainability™ 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.
EBDA 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.
EBDA / Required principal payments 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.
EBDA growth The percentage change in EBDA from one period to the next.
EBIDA 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.
EBIDA / (Interest paid + Required principal payments) 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.
EBIDA growth The percentage change in EBIDA from one period to the next.
EBITDA 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.
EBITDA (growth) The percentage change in EBITDA from one period to the next.
EBITDA / (Taxes paid + Interest paid) 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.
EBITDA / 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.
EBITDAR 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.
EBITDAR / (Interest paid + Rents) 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.
EBITDAR / (Taxes paid + Interest paid + Rents) 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.
EBITDAR growth The percentage change in EBITDAR from one period to the next.
Effect of exchange rate changes on cash 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.
Effective tax-rate expense (benefit) % 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
Effects of change in tax cash-flow profile on A summary of the measured effects of changes in tax cash-flow drivers on income tax related accounts from one period to the next.
Effects of exchange rate changes on cash - source (use) 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.
Effects of growth in income before income taxes on A summary of the measured effects of growth in income before income taxes on income tax related accounts from one period to the next.
Effects on income from continuing operations of change in effective tax rate from previous year 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.
Effects on income from continuing operations of change in gross margin from 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.
Effects on income from continuing operations of change in R&D expense ratio from 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.
Effects on income from continuing operations of change in SG&A expense ratio from 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.
Emerging Issues Task Force (EITF) The EITF assists the FASB through the timely identification, discussion, and resolution of financial accounting issues based upon existing authoritative literature.
EQI™ Earnings Quality Indicator™ 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)
Equity in Net Loss (Earnings) 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.
Equity method income (loss) 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.
Equity method investments 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.
Equity security An ownership interest in an enterprise, including preferred and common stock.
F. Bal Sheets Abbreviation for Forecast Balance Sheet.
F. CFA Stmts Abbreviation for Forecast Cash Flow Analysis Statement.
F. Drivers Abbreviation for Forecast Cash Flow Drivers Report.
F. Performance Abbreviation for Forecast Financial Performance Report.
F. Stmts of Inc Abbreviation for Forecast Statement of Income.
Factored accounts receivable The sale of accounts receivable, typically without recourse, to a financial institution that collects the underlying accounts directly from the seller company's customers.
FCM™ Free cash margin™ 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.
Fictitious revenue Revenue recognized on a nonexistent sale or service transaction.
Filing Date This is the date the company files its latest quarterly or annual report with the Securities and Exchange Commission. A new Cash Flow Analytics Score is calculated when the necessary data is made available to our data warehouse. Typically, data is made available to us within seven days of the filing date. If data from a company press release or other source containing results sufficient to calculate a Cash Flow Analytics Score is made available to us at a date earlier than the SEC filing date, that earlier date is used as the filing date.
Film production costs Costs incurred in producing a motion picture, including costs to obtain a screenplay, compensation of cast members, directors, producers, extras and other staff, set construction and operations, wardrobe and accessories, sound synchronization, on-location costs and postproduction costs such as music, special effects and editing.
Financial Accounting Standards Board (FASB) The principal standard setting body in the United States. Its primary products are Statements of Financial Accounting Standards (SFAS).
Financial covenant Agreements between debtors and creditors that commit the debtor to the maintenance of, for example, certain financial ratios. A positive financial covenant would be the requirement to maintain a working capital ratio of at least 1.5/1 or a fixed-charge coverage of at least 3/1. A negative covenant could set a limit set on a firm's ratio of debt to equity. Also referred to as loan covenants.
Financial Executives Institute (FEI) An international organization of financial professionals.
Financial Performance Report A Cash Flow Analytics, LLC 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.
Financial Reporting Standard (FRS) A financial reporting standard issued by the Accounting Standards Board of the United Kingdom.
Financing cash flow See also: Cash provided or used by financing activities
Financing transactions The sum of all cash flow related to external financing transactions.
Floor-plan financing 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.
Footnotes to financial statements and other sources Sources of data for input to Cash Flow Analytics, LLC reports that come primarily from the footnotes to the financial statements.
Forecast amortization expense on acquisition-related intangibles The forecast, based on forecast assumptions in amortization expense on acquisition-related intangibles.
Forecast average interest-bearing borrowings 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.
Forecast balance in capitalized debt issue costs The forecast, based on forecast assumptions, in capitalized debt issue costs.
Forecast balance in restructuring and merger-related reserve The forecast, based on forecast assumptions, in the restructuring and merger-related reserve.
Forecast balance in short-term borrowings The forecast, based on forecast assumptions, in short-term borrowings.
Forecast balance in short-term debt The forecast, based on forecast assumptions, in short-term debt.
Forecast Balance Sheet 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.
Forecast Cash Flow Analysis Statement 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.
Forecast Cash Flow Drivers Report 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.
Forecast Financial Performance Report 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 interest-bearing borrowings Forecast amounts for short-term and long-term debt and capital lease obligations on which interest accrues.
Forecast Statement of Income 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.
Forecast templates Standardized and custom Cash Flow Analytics, LLC financial report formats designed to use annual forecast data.
Foreign currency (gains) losses 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 gains (losses) 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.
Four Qtrs Ending Cash Flow Drivers: 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.
Four Qtrs Ending Cash-Flow Profile: The cash flow growth profile measured for a four-quarters ending reporting period.
Four Qtrs Ending Other Measures: Miscellaneous measures of performance measured for a four-quarters ending reporting period.
Four Qtrs Ending Profitability: Performance measures focused on analyzing the results of income-directed activity, measured here for a four-quarters ending reporting period.
Four quarters ending data 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.
GAAP operating cash flow Cash flow from operating activities computed in accordance with generally accepted accounting principles. See also: Reported operating cash flow
Gain (loss) on disposal of goodwill and intangibles 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.
Gain (loss) on disposal of investments 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.
Gain (loss) on disposal of other investing-related assets 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.
Gain (loss) on disposal of PP&E 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.
(Gain) loss on disposal of goodwill and intangibles 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.
(Gain) loss on disposal of investing-related assets 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.
(Gain) loss on disposal of investments 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.
(Gain) loss on disposal of PP&E 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.
Gains (losses) on asset dispositions 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.
Generally accepted accounting principles (GAAP) 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.
Goodwill 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 acquisition-related intangibles 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.
Goodwill and acquisition-related intangibles (not used) The balance in goodwill and acquisition-related intangibles that were not used in the calculations.
Goodwill and acquisition-related intangibles, net 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 intangibles, gross 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.
Goodwill, net 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.
Gross capital expenditures Capital expenditures before subtraction for the proceeds derived from the disposal of productive assets.
Income taxes payable Income taxes presently due and payable to a taxing authority. 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.
Income taxes payable to annualized 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 to 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-statement and balance-sheet change approach A method of computing operating cash flow by adjusting net income for non-cash expenses and changes in operating-related balance sheet accounts.
Increase in Investments Cash used in the purchase of investments as carried on the company-reported indirect method statement of cash flows.
Incremental net margin 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.
Incremental operating margin 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.
Indirect-method format 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.
Intangible pension asset 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.
Interest % earned on cash surplus or paid on cash shortage 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 capitalized to inventory 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 capitalized to inventory (CF Adj) 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 capitalized to inventory (YTD) (CF Adj) 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 capitalized to PP&E 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 capitalized to PP&E (CF Adj) 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 capitalized to PP&E (current qtr) The amount of interest added to property, plant and equipment during the current quarter.
Interest capitalized to PP&E (YTD) (CF Adj) 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.
Interest expense 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.
Interest expense as % of average borrowings Interest expense as reported on the income statement, net of interest capitalized, measured as a percentage of average interest-bearing borrowings.
Interest income 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.
Interest income (expense) on cash surplus (shortage) 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).
Interest paid with common stock 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.
Interest paid with common stock (YTD) 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 payable 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.
Interest-bearing borrowings Short-term and long-term debt and capital lease obligations on which interest accrues.
Internal-use software development costs 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.
International Accounting Standard (IAS) 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.
International Accounting Standards Board (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.
International Financial Reporting Standard (IFRS) A financial reporting standard issued by the International Accounting Standards Board.
Inventories - Finished Goods Stocks or goods that are completed and ready for sale.
Inventories - Other Stocks or goods that cannot be classified as raw materials, work in process or finished goods inventories.
Inventories - Raw Materials Stocks or goods in a raw or unmanufactured state that are used in the manufacture of goods for sale.
Inventories - Work In Process Stocks or goods in a partially manufactured or unfinished state that is not yet ready for sale.
Last-in first-out (LIFO) An inventory method that includes the earliest as opposed to most current, inventory acquisition costs in cost of sales.
Layered adjustments 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.
Lease receivables Amounts due from customers on long-term sales-type lease agreements.
Leverage Performance measures focused on analyzing a firm's ability to meet debt service requirements.
Life cycle 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.
LIFO liquidation 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.
LIFO reserve 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.
Liquidity Performance measures focused on analyzing the availability of funds needed to meet near-term obligations.
Litigation charge (income) 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.
Long-Term Debt - Issuance Cash provided from the issuance of long-term debt as carried on the company-reported indirect method statement of cash flows.
Long-Term Debt - Reduction Cash used to repurchase or retire long-term debt as carried on the company-reported indirect method statement of cash flows.
Long-term debt and capital lease obligations 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 debt financing 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.
Long-term debt maturing 2nd year Principal on long-term debt that is due and payable during the second year after the balance sheet date.
Long-term debt maturing 3rd year Principal on long-term debt that is due and payable during the third year after the balance sheet date.
Long-term debt maturing 4th year Principal on long-term debt that is due and payable during the fourth year after the balance sheet date.
Long-term debt maturing 5th year Principal on long-term debt that is due and payable during the fifth year after the balance sheet date.
Long-term financing obligations 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.
Long-term investments 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.
Long-term receivables Amounts due from customers, typically on an installment basis, which extend beyond one year.
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Net income (loss) from continuing operations 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 per diluted share Net income (loss) from continuing operations divided by the weighted average number of diluted common shares outstanding during the reporting period.
Net income (loss) per diluted share Net income (loss) divided by the average number of diluted common shares outstanding during the reporting period.
Net income plus depreciation Often referred to as traditional cash flow, its calculation removes an important non-cash expense from net income.
Net increase (decrease) in cash and equivalents 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.
Net margin Sustainable earnings to revenue from core operations. The percentage of revenue from core operations that results in sustainable earnings.
Net working capital 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.
NM (Net margin) (Sustainable earnings / Revenue from core operations) The percentage of revenue from core operations that results in sustainable earnings.
No. of common shares outstanding at period end 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.
No. of common shares repurchased during period (mln) (CF Adj) 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).
No. of common stock options exercisable at period end 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.
No. of common stock options exercised during period (CF Adj) 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.
No. of common stock options granted during period 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.
No. of common stock options outstanding at period end 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.
No. of employees in core operations The total number of persons employed by an organization. On the financial performance report, the account is used in calculating ratios measuring activity.
Noncontrolling interest 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.
Noncurrent accrued expenses payable 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
Noncurrent assets 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 discontinued operations 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.
Noncurrent capitalized operating expenses 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
Noncurrent customer-related notes receivable, net Amounts due from customers as a result of delivering goods or services that is represented by a more formal credit arrangement than open credit granted in the ordinary course of business and that is classified as noncurrent. 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
Noncurrent deferred revenue 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
Noncurrent deferred tax liabilities Future tax obligations that result from the origination of taxable temporary differences. When they originate, these temporary differences cause pretax book income to exceed taxable income. These future tax obligations are later paid when temporary differences reverse, now causing taxable income to exceed pretax book income. The noncurrent classification arises from the fact that these deferred tax liabilities arise from balance-sheet items that are classified as noncurrent, such as property, plant and equipment. 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.
Noncurrent deferred tax liabilities to income before income taxes % 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
Noncurrent financing-related notes payable 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.
Noncurrent liabilities 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.
Noncurrent liabilities of discontinued operations 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.
Noncurrent other notes receivable 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
Noncurrent portion, capital lease obligations 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.
Noncurrent portion, long-term debt 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.
Noncurrent prepaid expenses and deferred charges 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
Noncurrent subordinated and convertible debt 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.
Noncurrent subordinated debt 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 vendor-related notes payable 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
Nonqualified stock option 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.
Nonrecurring cash flow 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.
Nonrecurring revenue, expense, gain and loss 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.
Notes payable Promissory notes that are evidence of a debt and state the terms of interest and principal payment.
Notes receivable The sum of the current and noncurrent portions of non-customer-related notes receivable.
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Opportunistic cash flow classifications 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
Option and non-cash compensation expense incl. in SG&A 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.
Option and non-cash compensation expense incl. in SG&A (YTD) 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.
Option premium 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.
Options exercisable at period end / Shares outstanding A measure of the potential near-term dilution of common shares outstanding as a result of the exercise of outstanding options.
Options exercised during period / Average basic shares outstanding A measure of actual dilution of average basic shares outstanding as a result of options exercised during the period.
Options granted during period / Average basic shares outstanding A measure of potential future dilution of average basic shares outstanding resulting from new option grants during the period.
Options outstanding at period end / Shares outstanding A measure of potential future dilution of shares outstanding at period end resulting from the exercise of options.
Order backlog 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.
Originating temporary differences The initial creation of a temporary difference between pretax book income and taxable income.
Other (income) expense - nonrecurring 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.
Other acquisitions-related intangible assets, net 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.
Other current assets 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.
Other current liabilities Current liabilities not directly classifiable elsewhere including other operations-related current liabilities and current liabilities of discontinued operations.
Other equity-related financing 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.
Other financial services assets 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.
Other financial services liabilities 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.
Other financing-related current liabilities 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.
Other financing-related noncurrent liabilities 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.
Other financing-related noncurrent liabilities and other financial services liabilities 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.
Other income (expense) All sources of income and expense from continuing operations that does is not considered part of core operations or of financial services operations.
Other income (expense) - nonrecurring 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.
Other income (expense) - recurring 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.
Other increase (decrease) in retained earnings 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.
Other investing assets Unidentified assets related to the investing activites of as opposed to the operating activities of the firm.
Other investing-related current assets 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.
Other investing-related noncurrent assets 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.
Other mezzanine interests 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.
Other net financial services assets Financial services assets of a finance subsidiary of a non-financial firm less other financial services liabilities.
Other nonrecurring cash receipts (disbursements) 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.
Other operations-related assets 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.
Other operations-related current assets 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 (in revenue days) 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.
Other operations-related current liabilities 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.
Other operations-related noncurrent assets 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 (in revenue days) 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.
Other operations-related noncurrent liabilities 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.
Other positive (negative) equity accounts 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.
Other recurring cash receipts (disbursements) 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 reported financing source (use) of cash Other unidentified financing sources or (uses) of cash as carried on the company-reported indirect method statement of cash flows.
Other reported investing source (use) of cash Other unidentified investing sources or (uses) of cash as carried on the company-reported indirect method statement of cash flows.
Other reported operating source (use) of cash Other unidentified sources of (uses) of cash as carried on the company-reported indirect method statement of cash flows.
Other reported source (use) of cash 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.
Other shareholders' equity 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.
Outsized cash outflow 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.
Overdraft A negative cash balance.
Overdrafts payable 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
Overdrafts payable included in accounts payable 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.
Overdrafts payable included in accounts payable (CF Adj) 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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Pretax sustainable earnings An earnings measure calculated before income tax expense that is adjusted to exclude known items of nonrecurring revenue, gain, expense and loss. It is calculated as operating profit from core operations + operating profit from financial services operations + interest income + dividend income + rental and royalty income + equity method income (loss) - interest expense + minority interest in (income) loss + other recurring income (expense). While it excludes known nonrecurring items, pretax sustainable earnings may still include non-obvious and unknown effects of overly aggressive or increasingly conservative accounting practices. The Earnings Quality Indicator™ or EQI™ is an effective tool for surfacing developing operational problems and aggressive or conservative accounting practices.
Pretax sustainable earnings growth The percentage change in pretax sustainable earnings from one period to the next. See also: Pretax sustainable earnings
Pretax sustainable earnings return on average assets 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.
Price to book value A valuation metric calculated as the closing market price to book value per common share.
Price to cash and investments less borrowings A valuation metric calculated as the closing market price divided by cash and short-term investments net of total borrowings.
Price to cash and investments less borrowings (not less than zero) 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.
Price to EBITDA per diluted share A price multiple calculated using earnings before interest expense, tax expense, depreciation and amortization expense per diluted share.
Price to sustainable free cash flow per diluted share A price multiple calculated using sustainable free cash flow per diluted share.
Price to sustainable operating cash flow per diluted share A price multiple calculated using sustainable operating cash flow per diluted share.
Price to tangible net worth A valuation metric that measures the closing price relative to tangible net worth, shareholders' equity less goodwill and acquisition-related intangibles.
Price to TTM sustainable free cash flow per diluted share For quarterly results, a price multiple calculated using trailing twelve months sustainable free cash flow per diluted share.
Price to TTM sustainable operating cash flow per diluted share For quarterly results, a price multiple calculated using trailing twelve months sustainable operating cash flow per diluted share.
Prior-year current portion, capital lease obligations As of year-end of a prior year, the principal on capital lease obligations scheduled for repayment during the ensuing year.
Prior-year current portion, long-term debt As of year-end of a prior year, the principal on long-term debt scheduled for repayment during the ensuing year.
Pro-forma earnings A measures of earnings performance that selectively excludes nonrecurring as well as some non-cash items.
Proceeds from sale and operating leaseback 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.
Proceeds from sale and operating leaseback transactions (CF Adj) 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.
Proceeds from sale and operating leaseback transactions (YTD) (CF Adj) 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.
Profitability Performance measures focused on analyzing the results of income-directed activities.
Projected benefit obligation 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.
Projected cumulative increase (decrease) in cash and equivalents 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.
Projected increase (decrease) 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.
Property, plant and equipment, gross 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.
Reported operating cash flow 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
Reported operating cash margin The percentage of revenue from core operations that results in reported operating cash flow without adjustment for nonrecurring or nonoperating items.
Required principal payments on long-term debt and capital lease obligations 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.
Research and development expense 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 % 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 %
Restricted Cash 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.
Restructuring and merger-related charge (reversal) 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.
Restructuring and merger-related reserve 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.
Restructuring charge 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.
Restructuring reserve A liability reflecting restructuring costs that were previously accrued but that are to be paid or realized in future periods.
Retained earnings (deficit) 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 - beginning balance Retained earnings at the beginning of the current reporting period.
Retained earnings - ending balance Retained earnings at the end of the current reporting period.
Rev. Days Abbreviation for Revenue Days Balance Sheet.
Revenue backlog to revenue 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.
Revenue Days Balance Sheet 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 from core operations 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.
Sale and leaseback A sale followed by the immediate leaseback of the asset sold by its previous owner.
Sale and leaseback financing 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.
Sale of Common and Preferred Stock The proceeds received by the company for issuing common or preferred stock.
Sale of Investments Cash proceeds provided from the sale of investments as carried on the company-reported indirect method statement of cash flows.
Sale of PP&E and Investments - (Gain) Loss 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.
Sale of Property, Plant & Equipment The proceeds from sale of PP&E, including any gain or loss on sale.
Sarbanes-Oxley Act 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.
Seasonal factors Natural ebbs and flows in business activity occurring annually that are caused by changes in the seasons.
Securitization interest in accounts and notes receivable The portion of accounts or notes receivable that has been sold through a securitization arrangement for the purpose of generating cash proceeds.
Securitization interest in customer-related accounts and notes receivable (CF Adj) 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.
Securitized accounts receivable 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.
Selling, general and administrative expense 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.
Selling, general and administrative expense (excl. depreciation & amortization) 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 (excl. depreciation & 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) %
Senior borrowings Total borrowings, including both short-term and long-term amounts, excluding any subordinated borrowings.
Senior borrowings (Borrowings - subordinated debt) 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.
Senior borrowings / Shareholders' equity 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.
Senior borrowings / Tangible net worth 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.
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.
SG&A expense ratio 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
SG&A to revenue % 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.
Shareholders' equity 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.
Shareholders' equity growth The percentage change in shareholders' equity from one period to the next.
Short-term borrowings The principal on debt obligations, including notes payable and other short-term obligations, that are classified as current liabilities, typically due within one year.
Short-term debt 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.
Short-term debt financing 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.
Short-Term Investments - Change 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.
Short-term investments and trading securities 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 days 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.
Short-term investments, excl. trading 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.
Simple Moving Average (SMA) 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.
Software development costs 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.
Special charges 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.
Special purpose entity (SPE) 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).
Start-up stage The opening period in a company's life cycle during which operating losses are often reported and operating cash flow is consumed.
Statement of Income 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.
Statement of shareholders' equity 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.
Statements of income and dividends forecast input Input data for Cash Flow Analytics, LLC forecast reports derived from the statements of income and shareholders' equity.
Statements of Standard Accounting Practice (SSAP) 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.
Statutory income tax rates The income tax rates for different levels of taxable income found in the applicable income tax law.
Stmts of Inc. Abbreviation for Statement of Income.
Stock held in (treasury) 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.
Stock held in treasury 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.
Stock option 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.
Stock warrant 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.
Stop-and-Reversal (SAR) See also: Parabolic Stop-and-Reversal (SAR)
Subordinated and convertible debt financing 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.
Subordinated debt financing Funds raised through debentures and other long-term debt that is subordinated to other senior sources of financing.
Subscriber acquisition costs See also: Customer acquisition costs
(Subscription notes receivable) 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.
Supplemental data 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.
Sustainable cash flow worksheet 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.
Tax benefits from stock options exercised Realized tax savings resulting from the exercise of nonqualified options by company officers and employees. The tax savings arise due to a tax deduction received for the excess of the market price over the exercise price for any nonqualified options exercised. This is a cash flow adjustment item. It is disclosed on the statement of cash flows. Such benefits are reported as operating cash flow under GAAP. On the cash flow analysis statement the account is used in computing common equity financing, a component of financing transactions. In those cases where there is net cash paid in the buyback of shares for options, the account is subtracted from net cash paid in buyback of shares for options, a component of other recurring cash receipts (disbursements) and cash flow available for debt service.
Tax benefits from stock options exercised (CF Adj) Realized tax savings resulting from the exercise of nonqualified options by company officers and employees. The tax savings arise due to a tax deduction received for the excess of the market price over the exercise price for any nonqualified options exercised. This is a cash flow adjustment item. It is disclosed on the statement of cash flows. Such benefits are reported as operating cash flow under GAAP. On the cash flow analysis statement the account is used in computing common equity financing, a component of financing transactions. In those cases where there is net cash paid in the buyback of shares for options, the account is subtracted from net cash paid in buyback of shares for options, a component of other recurring cash receipts (disbursements) and cash flow available for debt service.
Tax benefits from stock options exercised (YTD) (CF Adj) Quarterly, year-to-date realized tax savings resulting from the exercise of nonqualified options by company officers and employees. The tax savings arise due to a tax deduction received for the excess of the market price over the exercise price for any nonqualified options exercised. Such benefits are reported as operating cash flow under GAAP. On the cash flow analysis statement the account is used in computing common equity financing, a component of financing transactions. For quarterly financial statement, sufficient option-related data is typically unavailable to permit calculation of net cash paid in buyback of shares for options. Accordingly, tax benefits from stock options exercised (YTD) are not used in the calculation of net cash paid in buyback of shares for options for quarterly financials.
Tax books A shorthand reference to the tax return income statement.
Tax cash impact of change in deferred tax assets to income before income taxes 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.
Tax cash impact of change in deferred tax liabilities to income before income taxes 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.
Tax cash impact of change in effective tax rate on income tax (expense) benefit 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.
Tax cash impact of change in income taxes payable to income before income taxes The measured effects of the change in income taxes payable to income before income taxes on the change in tax refund receivable from one period to the next.
Tax cash impact of change in tax refund receivable to income before income taxes The measured effects of the change in tax refund receivable to income before income taxes on the change in tax refund receivable from one period to the next.
Tax cash impact of deferred tax assets The measured effects of growth in income before income taxes and changes in the percentage of deferred tax assets to income before income taxes on the change in deferred tax assets from one period to the next.
Tax cash impact of deferred tax liabilities The measured effects of growth in income before income taxes and changes in the percentage of deferred tax liabilities to income before income taxes on the change in deferred tax liabilities from one period to the next.
Tax cash impact of growth on deferred tax assets The measured effects of growth in income before income taxes on the change in deferred tax assets from one period to the next.
Tax cash impact of growth on deferred tax liabilities The measured effects of growth in income before income taxes on the change in deferred tax liabilities from one period to the next.
Tax cash impact of growth on income tax (expense) benefit The measured effects of growth in income before income taxes on the change in income tax (expense) benefit from one period to the next.
Tax cash impact of growth on income taxes payable The measured effects of growth in income before income taxes on the change in income taxes payable from one period to the next.
Tax cash impact of growth on tax refund receivable The measured effects of growth in income before income taxes on the change in tax refund receivable from one period to the next.
Tax cash impact of income tax (expense) benefit The measured effects of growth in income before income taxes and changes in the effective tax rate on income tax expense during a period.
Tax cash impact of income taxes payable The measured effects of growth in income before income taxes and changes in the percentage of income taxes payable to income before income taxes on the change in income taxes payable from one period to the next.
Tax cash impact of tax refund receivable The measured effects of growth in income before income taxes and changes in the percentage of a tax refund receivable to income before income taxes on the change in a tax refund receivable from one period to the next.
Tax credits A direct dollar-for-dollar reduction in taxes payable.
Tax loss carryback Taxes paid on previously reported taxable earnings may be recovered by carrying losses back and setting them off against such previously reported taxable earnings. The current carryback period is generally two years, though a temporary extension to five years was enacted in connection with the recession that followed September 11, 2001.
Tax loss carryforward Current tax-return losses that exceed tax-return earnings in the loss carryback period may be carried forward. The current net operating loss (NOL) carryforward period is twenty years.
