Earnings can be decomposed into cash and accrual components. The accrual component (aggregate accruals) has been found to have less persistence than the cash component, and therefore (1) earnings with higher accrual component are less persistent than earnings with smaller accrual component, all else equal; and (2) the cash component of earnings should receive a higher weighting evaluating company performance.
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- Statement of Comprehensive Income
- Balance Sheet: Assets
- Common-Size Balance Sheet: Assets
- Analysis of Liquidity Ratios
- Analysis of Geographic Areas
- Common Stock Valuation Ratios
- Selected Financial Data since 2005
- Return on Equity (ROE) since 2005
- Debt to Equity since 2005
- Price to Operating Profit (P/OP) since 2005
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Balance-Sheet-Based Accruals Ratio
Apr 25, 2025 | Apr 26, 2024 | Apr 28, 2023 | Apr 29, 2022 | Apr 30, 2021 | Apr 24, 2020 | ||
---|---|---|---|---|---|---|---|
Operating Assets | |||||||
Total assets | |||||||
Less: Cash and cash equivalents | |||||||
Less: Investments | |||||||
Operating assets | |||||||
Operating Liabilities | |||||||
Total liabilities | |||||||
Less: Current debt obligations | |||||||
Less: Long-term debt | |||||||
Operating liabilities | |||||||
Net operating assets1 | |||||||
Balance-sheet-based aggregate accruals2 | |||||||
Financial Ratio | |||||||
Balance-sheet-based accruals ratio3 | |||||||
Benchmarks | |||||||
Balance-Sheet-Based Accruals Ratio, Competitors4 | |||||||
Abbott Laboratories | |||||||
CVS Health Corp. | |||||||
Elevance Health Inc. | |||||||
Intuitive Surgical Inc. | |||||||
UnitedHealth Group Inc. | |||||||
Balance-Sheet-Based Accruals Ratio, Sector | |||||||
Health Care Equipment & Services | |||||||
Balance-Sheet-Based Accruals Ratio, Industry | |||||||
Health Care |
Based on: 10-K (reporting date: 2025-04-25), 10-K (reporting date: 2024-04-26), 10-K (reporting date: 2023-04-28), 10-K (reporting date: 2022-04-29), 10-K (reporting date: 2021-04-30), 10-K (reporting date: 2020-04-24).
1 2025 Calculation
Net operating assets = Operating assets – Operating liabilities
= – =
2 2025 Calculation
Balance-sheet-based aggregate accruals = Net operating assets2025 – Net operating assets2024
= – =
3 2025 Calculation
Balance-sheet-based accruals ratio = 100 × Balance-sheet-based aggregate accruals ÷ Avg. net operating assets
= 100 × ÷ [( + ) ÷ 2] =
4 Click competitor name to see calculations.
The financial data indicates several noteworthy trends and fluctuations in the quality metrics over the five-year period.
- Net Operating Assets
- The net operating assets exhibited minor volatility throughout the assessed periods, ranging from a low of 66,262 million US dollars in April 2022 to a peak of 68,070 million US dollars in April 2023. Despite these fluctuations, the values remained relatively stable, ending at 67,807 million US dollars in April 2025, slightly above the base year level of 67,174 million US dollars in April 2021. This stability suggests a consistent scale of operational asset investment over time.
- Balance-sheet-based Aggregate Accruals
- A more pronounced variability is visible in the aggregate accruals data. The measure shifted significantly from a positive 2,453 million US dollars in April 2021 to a negative value of -912 million in April 2022. It then rebounded to a positive 1,808 million in April 2023, followed again by a negative figure of -631 million in April 2024, before returning to a positive 368 million in April 2025. These alternating positive and negative values signify irregularities in accrual accounting components, highlighting changes in non-cash expense recognition or timing differences in revenue and cost recording.
- Balance-sheet-based Accruals Ratio
- The accruals ratio, expressing aggregate accruals as a percentage of net operating assets, mirrors the fluctuations observed in the aggregate accruals data. It decreased from 3.72% in April 2021 to -1.37% in April 2022, then increased to 2.69% in April 2023, dropped again to -0.93% in April 2024, and ended at 0.54% in April 2025. The oscillation between positive and negative values suggests variations in earnings quality and the timing of income recognition, which may impact the predictability and sustainability of reported earnings.
Overall, while the net operating assets remained largely steady, the pattern of accruals indicates episodic shifts in financial reporting quality measures, with a tendency toward moderate volatility in accrual components over the observed periods.
Cash-Flow-Statement-Based Accruals Ratio
Apr 25, 2025 | Apr 26, 2024 | Apr 28, 2023 | Apr 29, 2022 | Apr 30, 2021 | Apr 24, 2020 | ||
---|---|---|---|---|---|---|---|
Net income attributable to Medtronic | |||||||
Less: Net cash provided by operating activities | |||||||
Less: Net cash used in investing activities | |||||||
Cash-flow-statement-based aggregate accruals | |||||||
Financial Ratio | |||||||
Cash-flow-statement-based accruals ratio1 | |||||||
Benchmarks | |||||||
Cash-Flow-Statement-Based Accruals Ratio, Competitors2 | |||||||
Abbott Laboratories | |||||||
CVS Health Corp. | |||||||
Elevance Health Inc. | |||||||
Intuitive Surgical Inc. | |||||||
UnitedHealth Group Inc. | |||||||
Cash-Flow-Statement-Based Accruals Ratio, Sector | |||||||
Health Care Equipment & Services | |||||||
Cash-Flow-Statement-Based Accruals Ratio, Industry | |||||||
Health Care |
Based on: 10-K (reporting date: 2025-04-25), 10-K (reporting date: 2024-04-26), 10-K (reporting date: 2023-04-28), 10-K (reporting date: 2022-04-29), 10-K (reporting date: 2021-04-30), 10-K (reporting date: 2020-04-24).
1 2025 Calculation
Cash-flow-statement-based accruals ratio = 100 × Cash-flow-statement-based aggregate accruals ÷ Avg. net operating assets
= 100 × ÷ [( + ) ÷ 2] =
2 Click competitor name to see calculations.
The analysis of the annual financial reporting quality measures over a five-year period reveals notable fluctuations and trends in net operating assets, cash-flow-statement-based aggregate accruals, and the corresponding accruals ratio.
- Net Operating Assets
- The net operating assets demonstrate relative stability with minor fluctuations. Beginning at approximately 67,174 million US dollars in the first observed period, the figure slightly decreased to 66,262 million in the following year. Subsequently, there was an increase to 68,070 million, followed by a modest decline in the next year to 67,439 million. The final period shows a slight rise to 67,807 million. Overall, net operating assets have remained within a narrow range, indicating consistency in the operational asset base over time.
- Cash-flow-statement-based Aggregate Accruals
- This measure shows considerable volatility across the periods. The initial positive figure of 232 million US dollars transitioned sharply into a negative value of -648 million in the second period. The third period recorded a substantial increase to 1,212 million, followed by two consecutive negative values of -745 million and -445 million in the fourth and fifth periods respectively. This pattern highlights inconsistent accrual activities, with alternating periods of high positive and significant negative accruals, potentially reflecting fluctuating earnings quality or timing differences in revenue and expense recognition.
- Cash-flow-statement-based Accruals Ratio
- The accruals ratio reflects a similar volatility. Starting at a modest positive 0.35%, it declined sharply to -0.97% in the next year. The ratio then surged to 1.8%, indicating a notable gain in accruals relative to net operating assets. However, this was followed by two negative ratios of -1.1% and -0.66% in the final two periods. These fluctuations suggest variability in the quality of earnings and indicate potential challenges in consistent earnings recognition or operational cash flow alignment.
In summary, while net operating assets exhibit stability, the measures related to accruals and accrual ratios reveal significant volatility. Such inconsistency in accruals may warrant further examination to understand the underlying causes, including the impact on reported earnings quality and potential implications for financial statement users.