Supplemental Disclosures to the Consolidated Statements of Cash Flows

3 Months Ended

Mar. 31, 2017

Supplemental Cash Flow Information [Abstract]

Supplemental Disclosures to the Consolidated Statements of Cash Flows

The following schedule provides additional information concerning acquisitions, interest and income taxes paid for the three-month periods ended March 31, 2017 and 2016.



(In millions)	2017			2016
Assets acquired, excluding cash	$	577		$	105
Liabilities assumed	(76		)	(4		)
Contingent/deferred purchase consideration	(90		)	(26		)
Net cash outflow for acquisitions	$	411		$	75



(In millions)	2017		2016
Interest paid	$	62	$	58
Income taxes paid, net of refunds	$	100	$	187

The classification of contingent consideration in the statement of cash flows is determined by whether the payment was part of the initial liability established on the acquisition date (financing) or an adjustment to the acquisition date liability (operating).

The following amounts are included in the consolidated statements of cash flows as a financing activity. The Company paid deferred and contingent consideration of $34 million for the three months ended March 31, 2017. This consisted of deferred purchase consideration related to prior years' acquisitions of $26 million and contingent consideration of $8 million. For the three months ended March 31, 2016, the Company paid deferred and contingent consideration of $39 million, consisting of deferred purchase consideration related to prior years' acquisitions of $25 million and contingent consideration of $14 million.

The following amounts are included in the operating section of the consolidated statements of cash flows. For the three months ended March 31, 2017, the Company recorded a net credit for adjustments to acquisition related accounts of $16 million and contingent consideration payments of $4 million. For the three months ended March 31, 2016, the Company recorded a net charge for adjustments related to acquisition related accounts of $5 million and contingent consideration payments of $4 million.

The Company had non-cash issuances of common stock under its share-based payment plan of $85 million and $67 million for the three months ended March 31, 2017 and 2016, respectively. The Company recorded stock-based compensation expense related to equity awards of $28 million and $20 million for the three-month periods ended March 31, 2017 and 2016, respectively.

Effective January 1, 2017, the Company adopted new accounting guidance related to share-based compensation, that requires companies to record excess tax benefits and tax deficiencies as an income tax benefit or expense in the income statement and classify excess tax benefits as an operating activity in the statement of cash flows. Prior to the adoption of this standard, the Company recorded excess tax benefits in equity in the consolidated balance sheet and as a financing activity in the consolidated statement of cash flows. For the three months ended March 31, 2017, the adoption of this new standard reduced income tax expense in the consolidated statement of income by approximately $44 million. For the three months ended March 31, 2016, the Company recorded an excess tax benefit of $18 million as an increase to equity in its consolidated balance sheet and an increase to cash provided by financing activities in the consolidated statement of cash flows.