Balance Sheet: Assets
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.
Assets are resources controlled by the company as a result of past events and from which future economic benefits are expected to flow to the entity.
McKesson Corp., consolidated balance sheet: assets
US$ in millions
Based on: 10-K (reporting date: 2016-03-31), 10-K (reporting date: 2015-03-31), 10-K (reporting date: 2014-03-31), 10-K (reporting date: 2013-03-31), 10-K (reporting date: 2012-03-31), 10-K (reporting date: 2011-03-31).
The financial data over the six-year period reveals several notable trends in asset composition and growth. Total assets consistently increased, reflecting ongoing expansion or investment activities, rising from approximately $30.9 billion to $56.6 billion by the end of the period.
- Cash and Cash Equivalents
- Cash holdings exhibited fluctuation, starting at $3.6 billion, declining through 2013 to $2.5 billion, then peaking in 2015 at $5.3 billion before decreasing again to $4.0 billion in 2016. This pattern suggests variations in liquidity management or cash flow dynamics.
- Receivables, Net
- Receivables consistently grew, nearly doubling from $9.2 billion in 2011 to approximately $18.0 billion in 2016. This growth indicates increased sales on credit or extended credit terms, warranting attention to collection efficiency and credit risk.
- Inventories, Net
- Inventory levels steadily increased from $9.2 billion to $15.3 billion. This expansion, along with higher receivables, may reflect higher operational activity or accumulation of stock, necessitating careful inventory turnover monitoring.
- Prepaid Expenses and Other
- This category grew modestly from $333 million to $1.1 billion by 2015 before a slight decline to $1.1 billion in 2016, representing increased advance payments or deferred charges, which require management to ensure efficient use of resources.
- Current Assets
- Current assets showed strong growth from $22.4 billion to $38.4 billion, driven largely by increases in receivables and inventories, coinciding with the overall asset growth trend.
- Property, Plant, and Equipment, Net
- Net fixed assets increased from $991 million to $2.3 billion, reflecting investment in tangible long-term resources. The steady rise indicates ongoing capital expenditure, potentially to support expanded operations.
- Goodwill
- Goodwill increased notably from $4.4 billion to nearly $10.0 billion by 2014, then slightly declined to $9.8 billion by 2016. The rise suggests acquisitions or corporate mergers, while the slight decline might indicate write-offs or impairments.
- Intangible Assets, Net
- Intangible assets more than doubled from $1.5 billion to over $5.0 billion by 2014 before decreasing to $3.0 billion in 2016, indicating acquisitions followed by amortization or impairment charges.
- Other Noncurrent Assets
- This category remained relatively stable around $1.7 billion initially but rose to $3.0 billion by 2016, indicating increased investments or long-term receivables.
- Noncurrent Assets
- Noncurrent assets nearly doubled from $8.5 billion to $18.1 billion during the period, reflecting substantial investments in long-term assets, including goodwill and intangibles, aligned with corporate growth strategies.
In conclusion, the data demonstrates that asset growth was broad-based, with significant increases in receivables, inventories, goodwill, and other noncurrent assets. The expansion suggests aggressive operational growth, including acquisitions and capital investments. Attention to working capital efficiency and asset utilization will be essential to maintain financial health amid growing asset bases.