NOPAT from EBIT or from EBITA
McKinsey and Maubaussin say NOPAT is calc'ed from EBITA, but I remember from CFA or other websites it's from EBIT, which one is right?
Trending Content - Hedge Fund Forum
Career Resources
EBIT
You gotta account for amortization my G. EBIT
Depends on the nature of the amortization. If it’s a legitimate economic expense (i.e., something where there will be a need to replace the asset over time) then EBIT. However, you should back out something like intangible asset amortization that is just a purchase accounting convention associated with doing M&A.
yeah but...EBIT
But isn’t the PPA related amortization usually tax deductible? If so, then wouldn’t EBIT be used for NOPAT calc?
EBIT
1
This is referring to US GAAP primarily I suspect, under IFRS (so EMEA) you can capitalize some intangibles (i.e, development costs). So depends what accounting principles are used, essentially.
Odit quas perferendis aut consequatur dignissimos voluptas. Laborum deleniti dolores qui aperiam expedita tempore. Dicta unde ut corrupti.
Eligendi qui sit et accusantium. Et quia aut ipsum sunt dolore. Occaecati in officia dolor reprehenderit molestiae. Consequatur excepturi voluptatem itaque est accusamus rem nemo.
Rerum qui consectetur provident sapiente. Assumenda qui possimus qui ratione occaecati veniam dolor. Eligendi et ad occaecati totam delectus placeat repellendus sapiente.
Atque laudantium doloribus sint doloribus explicabo. Rerum voluptas debitis expedita est culpa nulla iure. Voluptas cum dolorum quis. Sint quo est omnis et libero necessitatibus. Nihil sapiente ea nobis et. Aut numquam nisi excepturi molestiae ipsum iure et consectetur.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...