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H&R Block, Inc. | 2014 Form 10-K 47
CONSOLIDATED STATEMENTS OF CASH FLOWS (in 000s)
Year ended April 30, 2014 2013 2012
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 475,157 $ 433,948 $ 265,932
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization 115,604 92,407 103,576
Provision for bad debt and loan losses 80,007 90,685 97,365
Provision (benefit) for deferred taxes 20,958 (21,846) 13,227
Stock-based compensation 20,058 15,293 14,968
Impairment of goodwill and intangible assets 277 3,581 113,951
Changes in assets and liabilities, net of acquisitions:
Cash and cash equivalents — restricted 2,522 (69,737) (2,917)
Receivables (30,376) (72,662) 49,755
Prepaid expenses and other current assets 2,355 (3,465) 538
Other noncurrent assets (40,922) 78,778 25,552
Accounts payable, accrued expenses and other current liabilities 34,510 (37,017) (45,114)
Accrued salaries, wages and payroll taxes 33,362 (28,861) (58,210)
Accrued income taxes 121,038 88,459 (92,843)
Other noncurrent liabilities (7,779) (71,998) (88,870)
Other, net (17,190) (457) (34,861)
Net cash provided by operating activities 809,581 497,108 362,049
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of available-for-sale securities (45,158) (227,177) (256,173)
Sales, maturities and payments received on available-for-sale securities 107,101 118,411 66,382
Principal payments on mortgage loans held for investment, net 46,664 44,031 49,142
Capital expenditures (147,011) (113,239) (82,457)
Payments made for business acquisitions, net of cash acquired (68,428) (20,742) (15,258)
Proceeds from sale of businesses, net 942 3,785 560,499
Proceeds from notes receivable 64,865 — —
Franchise loans funded (63,960) (70,807) (46,246)
Payments received on franchise loans 87,220 83,445 56,591
Surrender of company-owned life insurance policies —81,125 —
Other, net 28,455 (9,769) 19,387
Net cash provided by (used in) investing activities 10,690 (110,937) 351,867
CASH FLOWS FROM FINANCING ACTIVITIES:
Repayments of commercial paper and other short-term borrowings (316,000) (1,214,238) (664,167)
Proceeds from issuance of commercial paper and other short-term borrowings 316,000 1,214,238 664,167
Repayments of long-term debt —(636,621) —
Proceeds from issuance of long-term debt —497,185 —
Repayments of FHLB borrowings —— (25,000)
Customer banking deposits, net (163,952) 103,608 (26,091)
Dividends paid (218,980) (217,201) (208,801)
Repurchase of common stock, including shares surrendered (6,106) (340,413) (180,592)
Proceeds from exercise of stock options 28,246 25,139 12,275
Other, net (4,138) (16,238) (16,853)
Net cash used in financing activities (364,930) (584,541) (445,062)
Effects of exchange rate changes on cash (17,618) 1,620 (2,364)
Net increase (decrease) in cash and cash equivalents 437,723 (196,750) 266,490
Cash and cash equivalents at beginning of the year 1,747,584 1,944,334 1,677,844
Cash and cash equivalents at end of the year $ 2,185,307 $ 1,747,584 $ 1,944,334
SUPPLEMENTARY CASH FLOW DATA:
Income taxes paid, net of refunds received $ 155,735 $ 155,617 $ 218,444
Interest paid on borrowings 55,221 73,559 69,681
Interest paid on deposits 2,162 5,665 6,843
Transfers of foreclosed loans to other assets 7,644 10,357 10,308
Transfer of mortgage loans held for investment to held for sale 7,608 — —
Accrued additions to property and equipment 5,257 4,261 801
Accrued purchase of common stock —— 22,484
See accompanying notes to consolidated financial statements.