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  "documentTitle": "Essential Utilities, Inc. (WTRG)",
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  "notes": "Uses a table to demonstrate the impact of reclassifying book overdrafts on OCF margins.",
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      "kind": "callout",
      "text": "A CPA Expert Opines That Treating Overdrafts As Operating Cash Flows Is More Appropriate",
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      "text": "Spruce Point finds alarming evidence that WTRG's operating cash flow margin is in continued decline - having been 48.2% in 2017 to just 23.9% in 2022.",
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      "text": "operating cash flow margin: 23.9%",
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      "text": "Spruce Point finds alarming evidence that WTRG's operating cash flow margin is in continued decline - having been 48.2% in 2017 to just 23.9% in 2022. Analytically, we reclassify changes in book overdrafts from financing to operating cash flows because they are classified as current liabilities and form part of working capital movements. Our analytical adjustment is supported by a CPA expert.",
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      "text": "Some companies do not include overdrafts in the definition of cash; instead, they include it in accounts payable. Consequently, the company treats the overdraft as an operating activity (change in accounts payable). So, the company includes the negative cash as a change in a liability in the operating section of the cash flow statement. (Some accountants treat overdrafts as a financing activity, but they clear quickly. Therefore, an operating activity classification is more appropriately.)",
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      "kind": "quote",
      "text": "\"Some companies do not include overdrafts in the definition of cash; instead, they include it in accounts payable. Consequently, the company treats the overdraft as an operating activity (change in accounts payable). So, the company includes the negative cash as a change in a liability in the operating section of the cash flow statement. (Some accountants treat overdrafts as a financing activity, but they clear quickly. Therefore, an operating activity classification is more appropriately.)\" — CPA Hall Talk",
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      "text": "Source: WTRG SEC filings and Spruce Point analysis",
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      "text": "Source: \"Cash Overdrafts: Negative Cash Accounting\", CPA Hall Talk",
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      "text": "Spruce Point's Adjusted Operating Cash Flow table showing OCF, Change in Book Overdraft, Adjusted OCF, Revenues, and % of Revenues from 2017-2022.",
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