In finance, we are generally more interested in cash flows than in accounting profits. Free cash flow (FCF) is calculated as after-tax operating income plus depreciation less the sum of capital expenditures and changes in net working capital.

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This statement is true. Finance professionals typically focus more on the actual cash flows that a business generates rather than simply its accounting profits, as these cash flows can provide a more accurate picture of a company's financial health and ability to invest in future growth. Free cash flow is one commonly used metric to assess cash flow, and it is calculated based on several key financial figures.

In Finance, We Are Generally More Interested in Cash Flows