Finance English
Analysis

What is Free Cashflow?

Free Cashflow The cash generated by a company after accounting for capital expenditures required to maintain or expand its asset base; represents cash available for debt repayment, dividends, or reinvestment.

Source: CFA Institute, IFRS Foundation, FASB (GAAP), Basel III Framework

How is “Free Cashflow” Used in Practice?

Positive free cashflow allows a company to reduce debt, pay dividends, or pursue new investment opportunities without external financing.

Certification Exam Relevance

CFAACCAFRM

Who Needs to Know This Term?

  • Financial Analysts
  • Bankers
  • Traders

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Frequently Asked Questions

What is Free Cashflow?

The cash generated by a company after accounting for capital expenditures required to maintain or expand its asset base; represents cash available for debt repayment, dividends, or reinvestment.

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