Stock Analysis on Net

Celgene Corp. (NASDAQ:CELG)

$22.49

This company has been moved to the archive! The financial data has not been updated since October 31, 2019.

Analysis of Bad Debts

Microsoft Excel

Allowance for doubtful accounts receivable (bad debts) is a contra account which reduce the balance of the company gross accounts receivable. The relationship between the allowance and the balance in receivables should be relatively constant unless there is a change in the economy overall or a change in customer base.

Paying user area


We accept:

Visa Mastercard American Express Maestro Discover JCB PayPal Google Pay
Visa Secure Mastercard Identity Check American Express SafeKey

Allowance for Doubtful Accounts Receivable

Microsoft Excel
Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015 Dec 31, 2014
Selected Financial Data (US$ in millions)
Allowance for doubtful accounts
Accounts receivable, gross
Financial Ratio
Allowance as a percentage of accounts receivable, gross1

Based on: 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31).

1 2018 Calculation
Allowance as a percentage of accounts receivable, gross = 100 × Allowance for doubtful accounts ÷ Accounts receivable, gross
= 100 × ÷ =


Allowance for doubtful accounts
The allowance for doubtful accounts showed a decreasing trend from 2014 to 2016, declining from 21 million US dollars to 15 million US dollars. It then stabilized around 16 million US dollars in the following two years, 2017 and 2018.
Accounts receivable, gross
There was a consistent and significant increase in gross accounts receivable over the five-year period. The value rose steadily year over year, starting at 1,187 million US dollars in 2014 and reaching 2,082 million US dollars by the end of 2018.
Allowance as a percentage of accounts receivable, gross
This ratio exhibited a clear downward trend throughout the time frame. It decreased from 1.74% in 2014 to 0.77% in 2018, indicating a declining proportion of doubtful accounts relative to the growing accounts receivable balance.
Overall analysis
The data suggests an improvement in the quality of accounts receivable over the period analyzed. Despite the gross accounts receivable nearly doubling, the allowance for doubtful accounts did not increase but slightly decreased and then stabilized. Consequently, the allowance as a percentage of gross accounts receivable declined markedly, which could reflect enhanced credit management, reduced credit risk, or changes in the estimation methodology for doubtful accounts. The steady rise in accounts receivable signals expanding sales or operations, while the decreasing allowance percentage implies greater confidence in collectibility.