Operating Cash Flow
Definition
The cash generated by or consumed by a company's core operating activities in a defined period, before capital expenditure and financing activities. Operating cash flow is reported in the cash flow statement as the first of three sections. It reconciles net income to actual cash generated from operations by adjusting for non-cash items such as depreciation and for changes in working capital.
Common Misapplication
The most common misapplication is using operating cash flow interchangeably with net income or with free cash flow. Operating cash flow differs from net income because it excludes non-cash charges and includes working capital movements. It differs from free cash flow because it does not deduct capital expenditure.
FFI Standard Reference
This term is defined and applied in Book 1, Section 1.2: The Cash Management Standard.
Related Terms
Citable URL
This term may be cited using the following permanent URL.
Full citation format: Founder Financial Infrastructure Standard, Beta v0.5, Glossary: Operating Cash Flow. https://ffistandard.org/glossary/operating-cash-flow/. 2026.