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.
National Oilwell Varco Inc., consolidated balance sheet: assets
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 analyzed data reveals several important trends in the financial position over the five-year period ending December 31, 2015.
- Cash and Cash Equivalents
- Cash reserves showed a moderate decline from 2011 to 2012, followed by a slight recovery in 2013 and 2014. However, a significant decrease occurred in 2015, with cash balances falling to the lowest level within the period analyzed.
- Receivables, Net
- Receivables increased considerably from 2011 through 2013, peaking in 2013. Thereafter, they declined sharply in 2014 and 2015, ending considerably below the 2013 peak and closer to the 2011 level, indicating either improved collections or reduced sales on credit.
- Inventories, Net
- Inventories rose substantially from 2011 to 2012 but began a gradual reduction starting in 2013, continuing through 2015. This downward trend could imply better inventory management or a reduction in production or sales volume.
- Costs in Excess of Billings
- This asset item showed strong growth up to 2014, more than tripling from 2011 levels, indicating increasing costs recognized ahead of billings. However, a decline occurred in 2015, which may suggest a slowdown in project activity or improved billing efficiency.
- Deferred Income Taxes (Current and Noncurrent)
- Both current and noncurrent deferred tax assets increased moderately over the period, indicating growing temporary differences with slight fluctuations but generally stable tax asset positions.
- Prepaid and Other Current Assets
- This category nearly doubled from 2011 to 2012, then remained relatively stable until a decline in 2015, indicating variable timing in prepaid expenses or other current asset activities.
- Current Assets
- Total current assets experienced strong growth through 2013, plateaued in 2014, and declined significantly in 2015, reflecting the combined trends of cash, receivables, inventories, and other current assets.
- Property, Plant and Equipment, Net
- Fixed assets increased steadily from 2011 to 2013, experienced a slight decline in 2014, and decreased further in 2015, indicating possible asset disposals, depreciation outpacing capital expenditures, or reduced investments.
- Goodwill
- Goodwill increased substantially from 2011 to 2013, peaking in 2013, followed by a decline through 2015. The 2015 goodwill level was still significantly above 2011 but well below the 2013 peak, implying impairment or divestiture activities.
- Intangibles, Net
- Intangible assets increased until 2013, then decreased notably in 2014 and 2015, similar to the goodwill trend, suggesting potential impairments or asset sales.
- Investment in Unconsolidated Affiliates
- This investment remained relatively stable throughout the years with a slight downward trend, indicating minimal changes in affiliate investments.
- Other Assets
- Other non-specified assets fluctuated moderately without a clear trend, reflecting possibly minor acquisitions or disposals.
- Noncurrent Assets
- Noncurrent assets showed strong growth through 2013, reaching a peak, followed by declines in 2014 and 2015, consistent with trends in property, goodwill, and intangible assets. The decline in the last two years suggests asset reductions or impairments.
- Total Assets
- Total asset base grew markedly through 2013, with a peak in 2013, followed by a decline in 2014 and a sharper reduction in 2015. The decreasing asset base in the last two years is primarily driven by declines in current assets and noncurrent assets, indicating a contraction in the overall asset size.