3M 2008 Annual Report Download - page 45

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39
reflected in any such forward-looking statements depending on a variety of factors. Discussion of these factors is
incorporated by reference from Part I, Item 1A, “Risk Factors,” of this document, and should be considered an
integral part of Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of
Operations.”
Item 7A. Quantitative and Qualitative Disclosures About Market Risk.
In the context of Item 7A, market risk refers to the risk of loss arising from adverse changes in financial and derivative
instrument market rates and prices, such as fluctuations in interest rates and foreign currency exchange rates. The
Company discusses risk management in various places throughout this document, including discussions in Item 7
concerning Financial Condition and Liquidity, and Financial Instruments, and in the Notes to Consolidated Financial
Statements (Long-Term Debt and Short-Term Borrowings, Derivatives, Fair Value Measurements, and the
Derivatives and Hedging Activities accounting policy). All derivative activity is governed by written policies, and a
value-at-risk analysis is provided for these derivatives. The Company does not have leveraged derivative positions.
However, the Company does have contingently convertible debt that, if conditions for conversion are met, is
convertible into shares of 3M common stock (refer to Note 10 in this document).