rgonzalez

In the period when you refinance, CFO will decrease, but CFF will increase. In a later period when you will repay your debt - your CFF will decrease accordingly, but CFO won't be affected by this transaction (now its a financial, not operating CF). So now your CFO will be inflated, because your cash outflow is in CFF instead of CFO.


If you look at the net effect of the two periods, CFO will be unaffected - it's all about timing of CFO.