PART II

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

Consolidated Balance Sheet

December 31,
2022 2021
(in millions, except per share data)
Assets
Current assets:
Cash and cash equivalents $ 7,008 $ 7,421
Restricted cash for litigation settlement 589 586
Investments 400 473
Accounts receivable 3,425 3,006
Settlement assets 1,270 1,319
Restricted security deposits held for customers 1,568 1,873
Prepaid expenses and other current assets 2,346 2,271
Total current assets 16,606 16,949
Property, equipment and right-of-use assets, net 2,006 1,907
Deferred income taxes 1,151 486
Goodwill 7,522 7,662
Other intangible assets, net 3,859 3,671
Other assets 7,580 6,994
Total Assets $ 38,724 $ 37,669
Liabilities, Redeemable Non-controlling Interests and Equity
Current liabilities:
Accounts payable $ 926 $ 738
Settlement obligations 1,111 913
Restricted security deposits held for customers 1,568 1,873
Accrued litigation 1,094 840
Accrued expenses 7,801 6,642
Short-term debt 274 792
Other current liabilities 1,397 1,364
Total current liabilities 14,171 13,162
Long-term debt 13,749 13,109
Deferred income taxes 393 395
Other liabilities 4,034 3,591
Total Liabilities 32,347 30,257
Commitments and Contingencies
Redeemable Non-controlling Interests 21 29
Stockholders’ Equity
Class A common stock, $0.0001 par value; authorized 3,000 shares, 1,399 and 1,397 shares
issued and 948 and 972 shares outstanding, respectively — —
Class B common stock, $0.0001 par value; authorized 1,200 shares, 8 shares issued and
outstanding — —
Additional paid-in-capital 5,298 5,061
Class A treasury stock, at cost, 451 and 425 shares, respectively (51,354) (42,588)
Retained earnings 53,607 45,648
Accumulated other comprehensive income (loss) (1,253) (809)
Mastercard Incorporated Stockholders' Equity 6,298 7,312
Non-controlling interests 58 71
Total Equity 6,356 7,383
Total Liabilities, Redeemable Non-controlling Interests and Equity $ 38,724 $ 37,669

The accompanying notes are an integral part of these consolidated financial statements.

MASTERCARD 2022 FORM 10-K 69

PART II
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

Consolidated Statement of Cash Flows

For the Years Ended December 31,
2022 2021 2020
(in millions)
Operating Activities
Net income $ 9,930 $ 8,687 $ 6,411
Adjustments to reconcile net income to net cash provided by operating activities:
Amortization of customer and merchant incentives 1,586 1,371 1,072
Depreciation and amortization 750 726 580
(Gains) losses on equity investments, net 145 (645) (30)
Share-based compensation 295 273 254
Deferred income taxes (651) (69) 73
Other 44 36 14
Changes in operating assets and liabilities:
Accounts receivable (481) (397) (86)
Income taxes receivable 12 (87) (2)
Settlement assets 48 390 1,288
Prepaid expenses (2,175) (2,087) (1,552)
Accrued litigation and legal settlements 240 (1) (73)
Restricted security deposits held for customers (305) 177 326
Accounts payable 190 100 26
Settlement obligations 201 (568) (1,242)
Accrued expenses 1,188 1,355 (114)
Long-term taxes payable (121) (52) (37)
Net change in other assets and liabilities 299 254 316
Net cash provided by operating activities 11,195 9,463 7,224
Investing Activities
Purchases of investment securities available-for-sale (267) (389) (220)
Purchases of investments held-to-maturity (239) (294) (198)
Proceeds from sales of investment securities available-for-sale 54 83 361
Proceeds from maturities of investment securities available-for-sale 211 291 140
Proceeds from maturities of investments held-to-maturity 265 296 121
Purchases of property and equipment (442) (407) (339)
Capitalized software (655) (407) (369)
Purchases of equity investments (88) (228) (214)
Proceeds from sales of equity investments 7 186 —
Acquisition of businesses, net of cash acquired (313) (4,436) (989)
Settlement of interest rate derivative contracts — — (175)
Other investing activities (3) 33 3
Net cash used in investing activities (1,470) (5,272) (1,879)
Financing Activities
Purchases of treasury stock (8,753) (5,904) (4,473)
Dividends paid (1,903) (1,741) (1,605)
Proceeds from debt, net 1,123 2,024 3,959
Payment of debt (724) (650) —
Acquisition of redeemable non-controlling interests (4) — (49)
Acquisition of non-controlling interest — (133) —
Contingent consideration paid — (64) —
Tax withholdings related to share-based payments (141) (133) (150)
Cash proceeds from exercise of stock options 90 61 97
Other financing activities (16) (15) 69
Net cash used in financing activities (10,328) (6,555) (2,152)
Effect of exchange rate changes on cash, cash equivalents, restricted cash and restricted cash equivalents (103) (153) 257
Net increase (decrease) in cash, cash equivalents, restricted cash and restricted cash equivalents (706) (2,517) 3,450
Cash, cash equivalents, restricted cash and restricted cash equivalents - beginning of period 9,902 12,419 8,969
Cash, cash equivalents, restricted cash and restricted cash equivalents - end of period $ 9,196 $ 9,902 $ 12,419

The accompanying notes are an integral part of these consolidated financial statements.

72 MASTERCARD 2022 FORM 10-K