NOPAT is the after-tax operating cash generated by the business, excluding unusual losses and gains, financing costs, goodwill and other non-cash items. It can be calculated two mathematically equivalent ways: Figure 1: Formulae for NOPAT Source: New Constructs, LLC Below are the primary accounting distortions in reported financial statements that require economic translation and adjustment for the NOPAT calculation. Hidden unusual items from the MD&A and ...
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