Operating Income and Operating Cash Flow - Taxes and Interest

CFA Level II
#1

The proxy for the operting income is EBIT, which is the income from the operating activities before interest and tax. EBIT can also contain non-operating profit/loss, in such a case EBIT should be adjusted to exclude these items. If we substract taxes, we get NOPAT, net operating profit after tax.

When we calculate the operating cash flow, under GAAP it should be equal to CFO, this is cash flow after investing in working capital, interests and taxes.

This is all still confusing, could some shed some light on the differences between operating cash flow and cash flow from operations?

#2

Your question confuses me. Operating cash flow is Cash flow from operations, you just re-arranged the words (http://en.wikipedia.org/wiki/Operating_cash_flow).

Are you struggling with EBIT/NOPAT? you seem to have it correct in your first paragraph (NOPAT=Op.Profit * (1-tr)=EBIAT).

#3

Operating cash flow and cash flow from operations are, as far as I can tell, synonymous.

#4

If this is the same thing, than I’m fine with it. Too much of studying, probably :’(