what is earnings before interest after taxes ebiat 
earnings before interest after taxes ebiat is one of a number of financial measures that is used to evaluate a company s profitability over a certain period such as a quarter or a year it is calculated by subtracting taxes from a company s earnings before interest and taxes ebit ebiat is not generated using generally accepted accounting principles gaap so it is not required to be used for external reporting or public disclosures 1 this also means that ebiat can be calculated differently by companies which can make comparisons between companies more challenging ebiat may still be a useful metric for internal management and investors it can help inform key decisions such as how much to invest in future growth understanding ebiatebiat s primary function is to gauge the amount of cash a company has to repay its debt obligations before considering any debt interest expenses and after factoring in taxes one key feature of ebiat is the fact that it considers taxes an unavoidable expense the calculation of ebiat includes taxes and removes any potential tax benefits that might be gained from debt financing such as the ability to deduct interest on debt to reduce a company s taxable income the purpose of the ebiat approach is to gain a more accurate picture of the company s financial standing because it removes factors that could artificially boost or reduce its financial strength ebiat may be more relevant in analyzing companies that have significant tax liabilities because it reflects a company s tax burden and can provide a more realistic view of the cash available to repay its obligations 