How this calculator works
Start with net income after tax and add back depreciation and amortization. Subtract increases in inventory and receivables, and add increases in payables. Enter decreases as negative changes. Income tax payable means its change, not its closing balance. The summary working-capital change excludes tax payable because that adjustment is entered separately. Other adjustments are signed additions to cash flow.
Formula
OCF = net income + depreciation + amortization - change in inventory - change in receivables + change in payables + change in tax payable + other adjustments. Change = closing balance - opening balance. Operating WC change here = inventory change + receivables change - payables change.
Worked example
Net income of $100,000 plus $10,000 depreciation and $5,000 amortization is $115,000. Subtract inventory growth of $10,000 and receivables growth of $5,000; add $4,000 payables growth, $2,000 tax payable growth and $3,000 other adjustments. OCF is $109,000.
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Frequently asked questions
What belongs in other adjustments?
Use signed reconciling items such as gains removed from profit, losses added back, provisions or other operating accruals. Exclude investing and financing cash movements.
Why add depreciation?
It reduced accounting income without a current-period cash payment. Capital spending is a separate investing cash flow.
Can I use this for a Canadian IFRS statement?
Use adjustments matching your statement and its classification policy. This is an indirect reconciliation template, not a complete financial reporting standard or automatic reclassification tool.