Many companies are contemplating whether they will be able to use net operating losses that built up during recent years. This article, by Michael Salama of the Walt Disney Co., suggests a new method and means for evaluating utilization of NOLs from a tax perspective in the context of financial statement and cash tax analysis. It highlights areas where Jensen's inequality may appear in modeling, and offers a step-wise approach to building sounder tax models to address uncertainty associated with data inputs.