Successful methodology for identifying earnings-related reporting indiscretions Creative Cash Flow Reporting and Analysis capitalizes on current concerns with misleading financial reporting on misleading financial reporting. It identifies the common steps used to yield misleading cash flow amounts, demonstrates how to adjust the cash flow statement for more effective analysis, and how to use adjusted operating cash flow to uncover earnings that have been misreported using aggressive or fraudulent accounting practices. Charles W. Mulford, PhD, CPA (Atlanta, GA), is the coauthor of three books, including the bestselling The Financial Numbers Game: Identifying Creative Accounting Practices. Eugene E. Comiskey, PhD, CPA, CMA (Atlanta, GA), is the coauthor of the bestselling The Financial Numbers Game: Identifying Creative Accounting Practices.

Successful methodology for identifying earnings-related reportingindiscretionsCreative Cash Flow Reporting and Analysis capitalizes on currentconcerns with misleading financial reporting on misleadingfinancial reporting. It identifies the common steps used to yieldmisleading cash flow amounts, demonstrates how to adjust the cashflow statement for more effective analysis, and how to use adjustedoperating cash flow to uncover earnings that have been misreportedusing aggressive or fraudulent accounting practices.Charles W. Mulford, PhD, CPA (Atlanta, GA), is the coauthor ofthree books, including the bestselling The Financial Numbers Game:Identifying Creative Accounting Practices. Eugene E. Comiskey, PhDCPA, CMA (Atlanta, GA), is the coauthor of the bestselling TheFinancial Numbers Game: Identifying Creative Accounting Practices.

Foreword xiPreface xiiiAbout the Authors xv1 Seeking Sustainable Cash Flow 1An Artificial Boost to Operating Cash Flow 3Classifying Cash Flow 5Sustainable Cash Flow 9Creative Cash Flow Reporting 18Ignoring the Statement of Cash Flows 29Cash Flow Analysis 30Plan of This Book 32Summary 332 Structure of the Statement of Cash Flows 37Historical Background 38Arrival of the Statement of Cash Flows 49Non-GAAP Measures of Cash Operating Performance 68International Differences in the Statement of Cash Flows 73Summary 743 Is it Operating or Investing Cash Flow? 81Investing Cash Flow 86GAAP Flexibility: Is it Operating or Investing Cash Flow? 91Beyond the Boundaries of GAAP 114Summary 1164 Is it Operating or Financing Cash Flow? 121Financing Cash Flow 125GAAP Flexibility: Is it Operating or Financing Cash Flow? 131Beyond the Boundaries of GAAP 154Summary 1555 Income Taxes and the Statement of Cash Flows 159Tax Reporting Essentials 160Classification of Tax-Related Cash Flow 166Nonrecurring Income Tax Cash Flows 180Summary 2036 Nonrecurring Sources and Uses of Operating Cash Flow 209Characteristics of Nonrecurring Items of Operating Cash Flow 211Examples of Nonrecurring Cash Sources and Uses 211Management Identification of Nonrecurring Operating Cash Flow 213Locating Nonrecurring Items of Operating Cash Flow 218Cash Flow Tracking 231Summary 2357 Measuring Sustainable Operating Cash Flow 241Sustainable Operating Cash Flow 242Calibrating Operating Cash Flow Adjustments 244Measuring Sustainable Operating Cash Flow 252Completed Sustainable Operating Cash Flow Worksheet 257Frequency and Size of Adjustment Items 262Summary 2658 Using Operating Cash Flow to Detect Earnings Problems 269Relationship between Earnings and Operating Cash Flow 271Earnings Supported by Artificial Means 284Excess Cash Margin 290Summary 3009 Analyzing Operating Cash Flow 305Cash Flow Analysis Statement 308Using the Cash Flow Analysis Statement 314Cash Flow Drivers 325Closer Look at Core Operating Cash Flow 336Summary 34110 Understanding Free Cash Flow 345Uses of Free Cash Flow 348What is Free Cash Flow? 358Free Cash Flow to Common Equity: A Closer Look 362Capital Expenditures 370Acquisitions and Free Cash Flow 375Summary 375Glossary 379Subject Index 395Company Index 409