Abbott Laboratories (ABT)

CASH, CASH EQUIVALENTS AND INVESTMENTS

Cash equivalents consist of bank time deposits, U.S. government securities money market funds and U.S. treasury bills with original maturities of three months or less. Abbott holds certain investments with a carrying value of approximately $235 million that are accounted for under the equity method of accounting. Investments held in a rabbi trust are accounted for as trading securities. All other investments in marketable equity securities are classified as available-for-sale and are recorded at fair value with any unrealized holding gains or losses, net of tax, included in Accumulated other comprehensive income (loss). Investments in equity securities that are not traded on public stock exchanges are recorded at cost. Investments in debt securities are classified as held-to-maturity, as management has both the intent and ability to hold these securities to maturity, and are reported at cost, net of any unamortized premium or discount. Income relating to these securities is reported as interest income.

Abbott reviews the carrying value of investments each quarter to determine whether an other than temporary decline in fair value exists. Abbott considers factors affecting the investee, factors affecting the industry the investee operates in and general equity market trends. Abbott considers the length of time an investment's fair value has been below carrying value and the near-term prospects for recovery to carrying value. When Abbott determines that an other than temporary decline has occurred, the investment is written down with a charge to Other (income) expense, net.

Source: Abbott Laboratories, Annual Report

Abbott Laboratories, adjustment to Net Earnings

USD $ in millions

Abbott Laboratories, adjusted ratios

Ratio	Description	The company
Adjusted net profit margin	An indicator of profitability, calculated as adjusted net income divided by revenue.	Abbott Laboratories's adjusted net profit margin deteriorated from 2015 to 2016 and from 2016 to 2017.
Adjusted ROE	A profitability ratio calculated as adjusted net income divided by shareholders' equity.	Abbott Laboratories's adjusted ROE deteriorated from 2015 to 2016 and from 2016 to 2017.
Adjusted ROA	A profitability ratio calculated as adjusted net income divided by total assets.	Abbott Laboratories's adjusted ROA deteriorated from 2015 to 2016 and from 2016 to 2017.

2017 Calculations

Ratio	Description	The company
Adjusted net profit margin	An indicator of profitability, calculated as adjusted net income divided by revenue.	Abbott Laboratories's adjusted net profit margin deteriorated from 2015 to 2016 and from 2016 to 2017.

2017 Calculations

Ratio	Description	The company
Adjusted ROE	A profitability ratio calculated as adjusted net income divided by shareholders' equity.	Abbott Laboratories's adjusted ROE deteriorated from 2015 to 2016 and from 2016 to 2017.

2017 Calculations

Ratio	Description	The company
Adjusted ROA	A profitability ratio calculated as adjusted net income divided by total assets.	Abbott Laboratories's adjusted ROA deteriorated from 2015 to 2016 and from 2016 to 2017.