Data Feed: Net Income to NOPAT Reconciliation

This data set contains the adjustments we make to convert reported net income to Net Operating Profit After Tax (NOPAT), the unlevered, normalized, recurring after-tax cash flows of the business. Updated daily.

See the General Information page for details on coverage, data file structure, delivery information, and sample real-time, point-in-time backtest and historical data files.


GAAP Net Income
GAAP net income.
+ Total Hidden Non-Operating Expense, Net
Total Net Non-Operating Expenses Hidden in Operating Earnings are the net of losses and gains that do not appear directly on the income statement. These items are bundled inside other line items that appear on the income statement. Hidden items are found only in the Management Discussion & Analysis (MD&A) or in the footnotes to the financial statements.
+ Reported Non-Operating Expense, Net
Reported Net Non-Operating Expenses are the net of non-operating charges and gains that appear directly on the income statement.
+ Change in Total Reserves
Change in Total Reserves captures changes in LIFO reserves, other inventory reserves, and loan loss reserves.
+ Goodwill Amortization Expense, Net
Goodwill Amortization Expenses, net is a gradual, formulaic reduction in goodwill asset value using any of the several GAAP amortization methods. In 2002, FASB did away with Goodwill amortization and replaced it with the practice of goodwill impairment. This adjustment only appears in historical filings prior to adoption of the new accounting standards.
- ESO Expense (Employee Stock Options)
ESO Expense (Employee Stock Options), net is the cost of issuing (at-the-money) employee stock options (ESOs) to employees before companies were required to expense ESOs. Prior to 2006, businesses were not required to record any cost for issuing ESOs. Using data provided only in footnotes, we charge companies for the cost of all ESO issuances long before FASB required companies to report the expense. This charge only appears in historical filings prior to adoption of the new accounting standards.
+ Implied Interest for Standardized Operating and Variable Lease Obligations
Interest for PV of Operating Leases is the implied interest expense added back to NOPAT for the capitalization of operating leases, a form of off-balance sheet debt. As of 2019, FASB requires operating leases to be on balance sheet. In the meantime, we capitalize all operating leases to make them like capital leases to ensure apples-to-apples comparability between companies employing different accounting techniques (i.e. capital leases vs operating leases) for the same economic activity.
+ Non-Operating Tax Adjustment
Non-Operating Tax Adjustment normalizes the reported income tax provision and accounts for the effects of non-operating items and deferred taxes.
+ Reported After-Tax Non-Operating Expense/(Income), Net
Net After-Tax Non-Operating Expense/(Income) are the net of non-operating expenses and income that appear directly on the income statement after tax. We classify Non-Operating After-Tax Expenses into the following types:
= NOPAT (Net Operating Profit After Tax)
NOPAT (Net Operating Profit After Tax)
= NOPAT (Net Operating Profit After Tax) Financing Approach
NOPAT calculated by the financing approach (adjusting Net Income to calculate NOPAT).

*Indicates the datapoint is affected by stock price.