# Free Cash Flow to the Firm

Written by Jerry Ratzlaff on . Posted in Manufacturing Engineering

Free cash flow to the firm, abbreviated as FCFF, is the available cash flow for investors.

## free cash flow to the firm Formulas

 $$\large{ FCFF = OCF + IE \; \left( 1 - TR \right) - CapEx }$$ $$\large{ FCFF = NI + NCC + IE \; \left( 1 - TR \right) - WC_i - CapEx }$$

### Where:

$$\large{ FCFF }$$ = free cash flow to the firm

$$\large{ OCF }$$ = operating cash flow

$$\large{ CapEx }$$ = capitol expenditures

$$\large{ IE }$$ = interest expense

$$\large{ NW_i }$$ = investment in working capital

$$\large{ NI }$$ = net income

$$\large{ NCC }$$ = non-cash charges

$$\large{ TR }$$ = tax rate