Stock Analysis on Net

General Mills Inc. (NYSE:GIS)

$22.49

This company has been moved to the archive! The financial data has not been updated since December 18, 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.


Allowance for Doubtful Accounts Receivable

Microsoft Excel
May 26, 2019 May 27, 2018 May 28, 2017 May 29, 2016 May 31, 2015 May 25, 2014
Selected Financial Data (US$ in thousands)
Allowance for doubtful accounts
Receivables, customers
Financial Ratio
Allowance as a percentage of receivables, customers1

Based on: 10-K (reporting date: 2019-05-26), 10-K (reporting date: 2018-05-27), 10-K (reporting date: 2017-05-28), 10-K (reporting date: 2016-05-29), 10-K (reporting date: 2015-05-31), 10-K (reporting date: 2014-05-25).

1 2019 Calculation
Allowance as a percentage of receivables, customers = 100 × Allowance for doubtful accounts ÷ Receivables, customers
= 100 × ÷ =


The analysis of the financial data over the period from May 2014 to May 2019 reveals notable trends concerning the allowance for doubtful accounts and customer receivables.

Allowance for Doubtful Accounts
The allowance for doubtful accounts showed an overall upward trend, increasing from US$21,000 thousand in May 2014 to US$28,800 thousand in May 2019. Though the allowance peaked at US$29,600 thousand in May 2016, it slightly declined the following year before continuing to rise towards the end of the period. This pattern suggests a general increase in anticipated credit losses, with some volatility around 2016 and 2017.
Receivables from Customers
Customer receivables displayed variability but an overall increase, starting at US$1,504,600 thousand in May 2014, declining during the next two years, and then rising significantly to US$1,712,600 thousand by May 2018, slightly decreasing thereafter to US$1,708,500 thousand in May 2019. This indicates that the company experienced fluctuations in accounts receivable before achieving substantial growth, likely reflecting changes in sales volume or credit policies.
Allowance as a Percentage of Receivables
The allowance as a percentage of receivables increased from 1.4% in May 2014 to a peak of 2.13% in May 2016, subsequently decreasing to around 1.66% to 1.69% towards the end of the period. The initial rise indicates a growing proportion of receivables recognized as potentially uncollectible. The reduction after 2016 may suggest improved credit quality or adjustments in the estimation of doubtful accounts despite the absolute increase in the allowance figure.

Overall, the data suggest that while the company’s customer receivables experienced growth accompanied by increased absolute allowance for doubtful accounts, the relative risk level as a percentage of receivables has somewhat stabilized after mid-period fluctuations. This could imply enhanced credit risk management or changes in credit terms to mitigate potential losses.