How to Calculate Free Cash Flow in Xero

Making the most of your Xero data

What is Free Cash Flow?

Free Cash Flow (FCF) is a measure of how much cash is available to a company after accounting for capital expenditures.

Free Cash Flow is a very important metric for investors, as it provides a good indication of how much money a company has to invest in itself.

Free Cash Flow is calculated by subtracting capital expenditures from net income, and then adding back non-cash expenses like depreciation.

How do you calculate Free Cash Flow in Xero?

It can be difficult to calculate Free Cash Flow directly inside of Xero; that's where Causal comes in.

Causal is a modelling tool which lets you build models on top of your Xero data. You simply connect Causal to your Xero account, and then you can build formulae in Causal to calculate your Free Cash Flow.

What is Causal?

Causal lets you build models effortlessly and share them with interactive, visual dashboards that everyone will understand.

In Causal, you build your models out of variables, which you can then link together in simple plain-English formulae to calculate metrics like Free Cash Flow. This makes your models easy to understand and quick to build, so you can spend minutes, not days, on your models.

A comparison of formulae in Excel and Causal

When you're done, you can share the link to your model with stakeholders. They'll be able to view your model's outputs in a visual dashboard, rather than a jumble of tabs and complex formulae. The dashboards are interactive, letting viewers tweak your assumptions to see how they affect the model's outputs.

A gif showing how users can adjust model inputs, and how they're reflected in dashboards

Causal lets you add visuals in a single click, letting you plot out graphs and distributions for metrics like Free Cash Flow.

A gif showing how you can build visuals in Causal

Get started today with Causal

Start building your own Free Cash Flow models, and connect them to your Xero data.