Discover 2015 Annual Report Download - page 171

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Discover Financial Services
(Parent Company Only)
Condensed Statements of Cash Flows
For the Years Ended December 31,
2015 2014 2013
(dollars in millions)
Cash flows from operating activities
Net income ...................................................................................................................... $ 2,297 $ 2,323 $2,470
Adjustments to reconcile net income to net cash provided by operating activities:
Equity in undistributed net income of subsidiaries ........................................................ (580) (517) (919)
Stock-based compensation expense ............................................................................ 56 60 59
Deferred income taxes .............................................................................................. (10) (5) (2)
Depreciation and amortization ................................................................................... 23 21 19
Changes in assets and liabilities:
Increase in other assets ............................................................................................. (13) (50)(33)
Increase in other liabilities and accrued expenses ........................................................ 83 32 29
Net cash provided by operating activities ............................................................................... 1,856 1,864 1,623
Cash flows from investing activities
Increase in investment in subsidiaries .............................................................................. (21) (35) —
Decrease (increase) in loans to subsidiaries ..................................................................... 1,700 (182) (29)
Net cash provided by (used for) investing activities .................................................................. 1,679 (217) (29)
Cash flows from financing activities
Net increase (decrease) in short-term borrowings from subsidiaries ................................... 206 (38) 58
Proceeds from issuance of common stock ........................................................................ 5 5 13
Proceeds from issuance of long-term borrowings ............................................................. 539 500 —
Purchases of treasury stock ............................................................................................ (1,715) (1,564) (1,296)
Net decrease in deposits ............................................................................................... (1) (8) (7)
Dividends paid on common and preferred stock .............................................................. (515) (467) (399)
Net cash used for financing activities ..................................................................................... (1,481) (1,572) (1,631)
Increase (decrease) in cash and cash equivalents .................................................................... 2,054 75 (37)
Cash and cash equivalents, at beginning of period .................................................................. 79 4 41
Cash and cash equivalents, at end of period ........................................................................... $ 2,133 $ 79 $ 4
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
Cash paid during the period for:
Interest expense ........................................................................................................... $ 97 $ 66 $ 65
Income taxes, net of income tax refunds .......................................................................... $ 109 $ 65 $ (1)
26. Subsequent Events
The Company has evaluated events and transactions that have occurred subsequent to December 31, 2015 and
determined there were no subsequent events that would require recognition or disclosure in the consolidated financial
statements.