Medtronic 2015 Annual Report Download - page 89

Medtronic plc
Notes to Consolidated Financial Statements (Continued)
computed based on the weighted average number of ordinary shares outstanding, increased by the number of additional shares
that would have been outstanding had the potentially dilutive ordinary shares been issued, and reduced by the number of shares
the Company could have repurchased from the proceeds from issuance of the potentially dilutive shares. Potentially dilutive
ordinary shares include stock options and other stock-based awards granted under stock-based compensation plans and shares
committed to be purchased under the employee stock purchase plan.
The table below sets forth the computation of basic and diluted earnings per share:
Fiscal Year
(in millions, except per share data) 2015 2014 2013
Numerator:
Net income attributable to ordinary shareholders $ 2,675 $ 3,065 $ 3,467
Denominator:
Basic - weighted average shares outstanding 1,095.5 1,002.1 1,019.3
Effect of dilutive securities:
Employee stock options 9.1 7.1 2.8
Employee restricted stock units 4.3 4.3 5.3
Other 0.1 0.1 0.1
Diluted - weighted average shares outstanding 1,109.0 1,013.6 1,027.5
Basic earnings per share $ 2.44 $ 3.06 $ 3.40
Diluted earnings per share $ 2.41 $ 3.02 $ 3.37
The calculation of weighted average diluted shares outstanding excludes options to purchase approximately 2 million, 5 million,
and 38 million ordinary shares in fiscal years 2015, 2014, and 2013, respectively, because their effect would be anti-dilutive on
the Company’s earnings per share.
New Accounting Standards
Recently Adopted
In March 2013, the Financial Accounting Standards Board (FASB) issued amended guidance on a parent company’s accounting
for the CTA recorded in AOCI associated with a foreign entity. The amendment requires a parent to release into net income the
CTA related to its investment in a foreign entity when it either sells a part or all of its investment, or no longer holds a
controlling financial interest, in a subsidiary or group of assets within a foreign entity. This accounting guidance was effective
for the Company beginning in the first quarter of fiscal year 2015. This amended guidance has not had a material impact on the
Company’s consolidated financial position or consolidated results of operations.
In July 2013, the FASB issued amended guidance on the financial statement presentation of an unrecognized tax benefit when a
net operating loss carryforward, similar tax loss, or tax credit carryforward exists. The guidance requires an unrecognized tax
benefit, or a portion of an unrecognized tax benefit, to be presented as a reduction of a deferred tax asset when a net operating
loss carryforward, similar tax loss, or tax credit carryforward exists, with certain exceptions. The Company prospectively
adopted this accounting guidance in the first quarter of fiscal year 2015 and its adoption did not have a material impact on the
Company’s consolidated financial statements.
Not Yet Adopted
In April 2014, the FASB issued amended guidance for reporting discontinued operations. The amended guidance changes the
criteria for determining when the results of operations are to be reported as discontinued operations and expands the related
disclosure requirements. The guidance defines a discontinued operation as a component or group of components that is disposed
of or classified as held for sale which is a strategic shift that has, or will have, a major effect on financial position and results of
operations. This accounting guidance is effective prospectively for the Company beginning in the first quarter of fiscal year
2016. The adoption is not expected to have a material impact on the Company’s consolidated financial statements.
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