Metev Case in Equity Topic Test

CFA Level II Equities
#1

Hi guys

A quick question on Metev Case in CFAI’s Equity Topic Test. For Question 3, the answer says EBITDA overestimates cash flow from operations if working capital is growing. Why so?

Thanks.

#2

Discussed here

http://www.analystforum.com/forums/cfa-forums/cfa-level-ii-forum/91333103

#3

Thanks for directing me to the post, it’s quite useful discussion!