Use this calculation when every balance, flow, and elapsed period follows the same accounting basis, currency, entity boundary, and reporting period. It is useful for a reproducible schedule or analytical cross-check, but the result should still reconcile to the ledger.

Operating cash flow

Net cash provided by operating activities for the period; outflows are entered as negative amounts.

Capital expenditures

Cash spent on capital expenditures such as property, plant, and equipment purchases for the same period.

The implemented rule is: Calculate free cash flow as net cash provided by operating activities minus capital expenditures for the same period and currency.^[1]

Free cash flow

Free cash flow: operating cash remaining after capital expenditures; negative values indicate capital spending exceeded operating cash.

The calculator applies the stated arithmetic and does not decide whether a recognition method or classification is permitted under a particular accounting framework. Estimates, cutoff errors, seasonality, acquisition effects, inconsistent averages, and differing policies can make a mathematically correct result misleading. Free cash flow has multiple conventions; this tool uses operating cash flow minus capital expenditure and should be labelled accordingly.

Reconcile the inputs to the general ledger and supporting schedules. For reporting decisions, compare the result with the entity's accounting policy, applicable GAAP or IFRS guidance, prior-period disclosures, and an accountant's review.

• EBITDA from Net Income Addbacks Calculator

  Calculate EBITDA as net income plus interest, taxes, depreciation, and amortization addbacks, all from the same period and currency.

• Cash Conversion Cycle Calculator

  Calculate the cash conversion cycle in days as days inventory outstanding plus days sales outstanding minus days payable outstanding.