What is the correct way to account for deferred taxes and provisions in a DCF?
Should I just leave the deferred taxes as they are and assume that future taxes will offset each other and have no impact on aggregate cash flows?
Or should I subtract the increase in deferred taxes and only use cash taxes?
If I do leave deferred taxes in, do I have to do anything with the deferred tax liability account? (I'm assuming no since I will be taking them into account in the FCFs)
Lastly, how do you usually treat other provisions in your valuations (operating and non-operating)?
Thank you all for your help