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Are Taxes Counted Twice in Operating Cash Flow?

A reader has a question about Operating Cash Flow for corporate 10k filings

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Hi - I am trying to understand Financial Statements and have run into something I can't find an answer for online.

The Cash Flow from Operating Activities (Operating Cash Flow) line item on a company's Consolidated Statement of Cash Flows starts with Net Income from the Income Statement and adds back non-cash items and other adjustments to arrive at the total operating cash generated or consumed in the period. One of these line items is sometimes "Income Tax Paid."  But isn't "Income Tax Provision" already subtracted from EBT on the Income Statement to arrive at Net Income?


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By Djeffery
Feb 26th 2021 08:36 EST

You’re correct regarding the net income. The items that you should see as adjustments in operating cash flow are changes in taxes located on the balance sheet. Deferred tax assets, liabilities, etc.. Then there is a supplemental schedule that is required at the end of the statement for actual cash paid for interest and taxes.

Hopefully, this helps a little bit!

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