Medtronic 2016 Annual Report Download - page 43
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Table of Contents
40
Fiscal year ended April 24, 2015
(in millions) Net Sales Operating
Profit
Income from
Operations
Before Income
Taxes Net Income
Provision
for Income
Taxes (1) Effective
Tax Rate
GAAP $ 20,261 $ 3,766 $ 3,486 $ 2,675 $ 811 23.3%
Non-GAAP Adjustments:
Impact of inventory step-up — 623 623 455 168 27.0
Impact of product technology upgrade
commitment — 74 74 61 13 17.6
Special (gains) charges, net — (38)(38)(23)(15) 39.5
Restructuring charges, net — 252 252 180 72 28.6
Certain litigation charges, net — 42 42 27 15 35.7
Acquisition-related items — 550 550 433 117 21.3
Amortization of intangible assets — 733 733 538 195 26.6
Impact of acquisition on interest
expense — — 77 49 28 36.4
Certain tax adjustments — — — 349 (349) —
Non-GAAP $ 20,261 $ 6,002 $ 5,799 $ 4,744 $ 1,055 18.2%
(1) The tax effect of each Non-GAAP Adjustment is based on the jurisdictions in which the expense (income) is incurred and the tax laws in
effect for each such jurisdiction.
Fiscal year ended April 25, 2014
(in millions) Net Sales Operating
Profit
Income from
Operations
Before Income
Taxes Net Income
Provision
for Income
Taxes (1) Effective
Tax Rate
GAAP $ 17,005 $ 3,813 $ 3,705 $ 3,065 $ 640 17.3%
Non-GAAP Adjustments:
Special charges — 40 40 26 14 35.0
Restructuring charges, net — 88 88 60 28 31.8
Certain litigation charges, net — 770 770 701 69 9.0
Acquisition-related items — 117 117 79 38 32.5
Amortization of intangible assets — 349 349 230 119 34.1
Certain tax adjustments — — — (63) 63 —
Non-GAAP $ 17,005 $ 5,177 $ 5,069 $ 4,098 $ 971 19.2%
(1) The tax effect of each Non-GAAP Adjustment is based on the jurisdictions in which the expense (income) is incurred and the tax laws in
effect for each such jurisdiction.
Critical Accounting Estimates
The preparation of the consolidated financial statements, in conformity with U.S. GAAP, requires management to use judgment
in making estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, and expenses. These estimates
reflect managements' best judgment about economic and market conditions and their potential effects on the valuation and/or
carrying value of assets and liabilities based upon relevant information available. We base our estimates on historical experience
and on various assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for
making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. See also Note
1 to the consolidated financial statements in “Item 8. Financial Statements and Supplementary Data” in this Annual Report on
Form 10-K, which discusses our significant accounting policies.