Hi dig,
Don't confuse tax style depreciation and income statement style depreciation.
The tax type version affects the tax liability.
On the income statement side of things, depreciation of fixed assets is a pure accounting calculation to reflect the diminution in the value of fixed assets over time.
You buy a car. Every year, its value diminishes but you don't pay anyone anything because it does so. What you paid for your car is in the purchase price.
So Wave purchased its fixed assets. And it is recognising that the value of those assets has diminished over time.
No effect on cash flow. So you have to pull it out of the cash flow calculation.
And of course, because Wave makes losses, the depreciation of the assets is a gathering tax asset, but this asset will not appear on the balance sheet.
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