Balance Sheet: Liabilities and Stockholders’ Equity
The balance sheet provides creditors, investors, and analysts with information on company resources (assets) and its sources of capital (its equity and liabilities). It normally also provides information about the future earnings capacity of a company assets as well as an indication of cash flows that may come from receivables and inventories.
Liabilities represents obligations of a company arising from past events, the settlement of which is expected to result in an outflow of economic benefits from the entity.
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- Cash Flow Statement
- Analysis of Profitability Ratios
- Analysis of Solvency Ratios
- Analysis of Short-term (Operating) Activity Ratios
- DuPont Analysis: Disaggregation of ROE, ROA, and Net Profit Margin
- Analysis of Geographic Areas
- Enterprise Value (EV)
- Capital Asset Pricing Model (CAPM)
- Current Ratio since 2005
- Price to Book Value (P/BV) since 2005
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EMC Corp., consolidated balance sheet: liabilities and stockholders’ equity
US$ in millions
Based on: 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31).
The financial data indicates several notable trends in the company's liabilities, equity, and overall financial structure over the five-year period ending December 31, 2015.
- Current Liabilities
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Accounts payable showed variability with a general upward trend, increasing from $1,102 million in 2011 to a peak of $1,696 million in 2014 before slightly decreasing to $1,644 million in 2015. Salaries and benefits costs consistently increased until 2014, reaching $1,260 million, followed by a decline to $1,189 million in 2015. Product warranties declined steadily from $255 million in 2011 to $172 million in 2015, indicating possible improvements in product quality or warranty management.
Dividends payable appeared only from 2013 onward, stabilizing around $234 million in 2015. Partner rebates steadily increased from $168 million in 2011 to a peak of $235 million in 2014, followed by a slight decrease in 2015. Restructuring charges showed a significant increase from $62 million in 2011 to $333 million in 2015, which may reflect ongoing operational changes or cost-cutting initiatives.
Derivatives exposure fluctuated with a low of $23 million in 2013 and increased to $82 million by 2015. Other current liabilities generally increased until 2014, then declined in 2015. Accrued expenses grew steadily each year from $2,355 million in 2011 to $3,123 million in 2015, indicating higher pending obligations. Notes converted and payable showed a non-consistent pattern with some missing data but remained a significant liability when reported.
Income taxes payable (current) had mixed trends: some increases from $156 million in 2011 to $852 million in 2014, followed by a decrease to $609 million in 2015. Short-term debt only appeared in 2015 with a notable figure of $1,299 million. The current portion of convertible debt was reported early in the period but then disappeared from the reported figures.
Deferred revenue, a significant liability, consistently increased across both reported rows, reaching $6,210 million and $4,592 million respectively by 2015. Overall, current liabilities remained relatively stable around $10 billion until 2013, after which they increased to nearly $12.9 billion by 2015.
- Noncurrent Liabilities
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Deferred income taxes declined substantially from $603 million in 2011 to an unreported figure in 2015, reflecting potential changes in tax positions or asset valuations. Long-term debt appeared starting 2013 at $5,494 million and remained relatively stable through 2015. Long-term convertible debt declined from $119 million in 2011 to no reported amounts later. Other noncurrent liabilities steadily increased, reaching $480 million in 2015.
Noncurrent liabilities experienced a marked increase, particularly between 2012 and 2013, rising from $4,241 million to $10,264 million and continued growing slightly thereafter. This may be largely attributed to the recognition of long-term debt and other obligations.
- Total Liabilities
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Total liabilities showed substantial growth over the period, jumping from $14,341 million in 2011 to $23,893 million in 2015. The most significant increase occurred between 2012 and 2013, correlating with noticeable increases in both current and noncurrent liabilities.
- Shareholders’ Equity
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Common stock remained relatively constant with a slight decline from $20 million to $19 million. Additional paid-in capital showed erratic movement, peaking significantly in 2012 before substantial decreases in subsequent years. Retained earnings rose steadily from $16,121 million in 2011 to a peak of $22,242 million in 2014 but slightly declined to $21,700 million in 2015.
Accumulated other comprehensive loss increased in magnitude, moving from -$235 million in 2011 to -$579 million in 2015, indicating increasing unrealized losses or other comprehensive expense items. The corporation’s total shareholders’ equity peaked in 2012 but progressively declined from 2013 onward, ending at $21,140 million in 2015. Non-controlling interests steadily grew over the five years, reaching $1,579 million by 2015.
Overall total shareholders’ equity showed a peak in 2013 of $23,786 million but hovered downward thereafter, closing at $22,719 million in 2015.
- Total Liabilities and Shareholders’ Equity
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The combined total of liabilities and shareholders’ equity increased from $34,268 million in 2011 to $46,612 million in 2015, reflecting growth in the company’s balance sheet size primarily driven by liabilities.