Cashflow Available for Debt Service (CFADS)

By August 18, 2022No Comments

The cashflow remaining in a given period (either historical or projected) after cash operating costs and taxes have been deducted from operating revenues. It is emphasised that this is a cashflow – rather than revenue statement (P&L) – concept, so items such as provisions and depreciation are not taken into account. CFADS is a critically important concept in project finance because it is the prime source of debt repayment and interest payments. It is also typically the starting point for calculating the amount of debt and the way in which it is repaid.