Anthera Pharmaceuticals (Anthera Pharmaceuticals) Depreciation, Depletion and Amortization : $0.40 Mil (TTM As of Mar. 2018)

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Anthera Pharmaceuticals Depreciation, Depletion and Amortization Chart

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Anthera Pharmaceuticals Depreciation, Depletion and Amortization Calculation

Depreciation is a present expense that accounts for the past cost of an asset that is now providing benefits.

Depletion and amortization are synonyms for depreciation.

Generally:
The term depreciation is used when discussing man made tangible assets
The term depletion is used when discussing natural tangible assets
The term amortization is used when discussing intangible assets

Depreciation, Depletion and Amortization for the trailing twelve months (TTM) ended in Mar. 2018 adds up the quarterly data reported by the company within the most recent 12 months, which was $0.40 Mil.

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

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Anthera Pharmaceuticals  (OTCPK:ANTH) Depreciation, Depletion and Amortization Explanation

One of the key tenets of Generally Accepted Accounting Principles (GAAP) is the matching principle. The matching principle states that companies should report associated costs and benefits at the same time.

For example:

If a company buys a $300 million cruise ship in 1982 and then sells tickets to passengers for the next 30 years, the company should not report a $300 million expense in 1982 and then ticket sales for 1982 through 2012. Instead, the company should spread the purchase price of the ship (the cost) over the same time period it sells tickets (the benefit).

To create income statements that meet the matching principle, accountants use an expense called depreciation.

So, instead of reporting a $300 million purchase expense in 1982, the company might:

Report a $30 million depreciation expense in 1982, 1983, 1984...and every year after that for the 30 years the company expects to sell tickets to passengers on this cruise ship.

To calculate depreciation, a company must make estimates and choices such as:

The cost of the asset
The useful life of the asset
The salvage value of the asset at the end of its useful life
And a way of spreading the cost of the asset to match the time when the asset provides benefits

The range of different ways of spreading the cost under GAAP accounting is too long to list. However, public companies in the United States explain their depreciation choices to shareholders in a note to their financial statements. It is critical that investors read this note. Investors can find this note in the company's 10-K.

Past depreciation expenses accumulate on the balance sheet. Most public companies choose not to show this contra asset account on the balance sheet they present to shareholders. Instead, they simply show a single item. This single asset item may be marked Net. Such as Property, Plant, and Equipment - Net. It is actually the asset account netted against the contra asset account.

A contra asset account is an account that offsets an asset account. So, for example a company might have:

Property, Plant, and Equipment - Gross: $150 million
Accumulated Depreciation: $120 million
Property, Plant, and Equipment - Net: $30 million

In this case, the only item likely to be shown on the balance sheet is Property, Plant, and Equipment - Net. This is the cost of the company's property, plant, and equipment (asset account) minus the accumulated depreciation (the contra asset account). It means the company's assets cost $150 million, the company has reported $120 million in depreciation expense over the years, and the company is now reporting the assets have a book value of $30 million.

It is possible for a company to have fully depreciated assets on its balance sheet. This means the company's estimate of the useful life of the asset was shorter than the asset's actual useful life. As a result, the asset - although it is still being used - is carried on the balance sheet at its salvage value.

This is a reminder that depreciation involves estimates and choices. It is not an infallible process.

Companies do not have cash layout for depreciation. Therefore, depreciation is added back in the cash flow statement.

Although depreciation is not a cash cost, it is a real business cost because the company has to pay for the fixed assets when it purchases them. Both Warren Buffett and Charlie Munger hate the idea of EDITDA because depreciation is not included as an expense. Warren Buffett even jokingly said We prefer earnings before everything when criticizing the abuse of EDITDA.

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Be Aware

Depreciation estimates make the calculation of net income susceptible to management's accounting choices. These choices can be either overly aggressive or overly conservative.

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Anthera Pharmaceuticals Depreciation, Depletion and Amortization Related Terms

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Operating Income Operating Margin % EBITDA

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Anthera Pharmaceuticals (Anthera Pharmaceuticals) Business Description

Executives

Christopher S Henney	director	10505 ROSELLE STREET, SAN DIEGO CA 92121
Shanahan William R Jr	officer: Chief Medical Officer	10301 STELLA LINK HOUSTON TX 77025
Brian Mueller	director	C/O BIOMARIN PHARMACEUTICAL INC., 105 DIGITAL DRIVE, NOVATO CA 94949
Paul F Truex	director	PENINSULA PHARMACEUTICALS, INC., 1751 HARBOR BAY PARKWAY, ALAMEDA CA 94502
Charles V Olson	officer: Chief Technology Officer	25801 INDUSTRIAL BLVD., SUITE B, HAYWARD CA 94545
Klara Dickinson	officer: Chief Regulatory Officer	C/O CYMABAY THERAPEUTICS, INC., 7575 GATEWAY BLVD., SUITE 110, NEWARK CA 94560
Steven B Engle	director	C/O XOMA LTD., 2910 SEVENTH STREET, BERKELEY CA 94710
James Pennington	officer: Interim Chief Medical Officer	25801 INDUSTRIAL BLVD, SUITE B, HAYWARD CA 94545
Hislop Colin	officer: Chief Medical Officer	C/O PENINSULA PHARMACEUTICALS, INC., 1751 HARBOR BAY PARKWAY, ALAMEDA CA 94502
Sanford S Zweifach	director	21720 23RD DRIVE SE, SUITE 150, BOTHELL WA 98021
Daniel K Spiegelman	director	MYRIAD GENETICS, 320 WAKARA WAY, SALT LAKE CITY UT 84003
Christopher P. Lowe	officer: CFO and Chief Business Officer	2511 N LOOP 1604,, SUITE 204, SAN ANTONIO TX 78258
James Healy	director	3000 SAND HILL ROAD, 4-250, MENLO PARK CA 94025
Orbimed Capital Gp Iv Llc	director	601 LEXINGTON AVENUE, 54TH FLOOR, NEW YORK NY 10022
Samuel D Isaly	director	601 LEXINGTON AVENUE, 54TH FLOOR, NEW YORK NY 10022