Baker Hughes 2014 Annual Report Download - page 37

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12
Our business could be impacted by geopolitical and terrorism threats.
Geopolitical and terrorism risks continue to grow in a number of key countries where we do business.
Geopolitical and terrorism risks could lead to, among other things, a loss of our investment in the country,
impairment of the safety of our employees and impairment of our ability to conduct our operations.
Our business operations may be impacted by civil unrest, government expropriations and/or epidemic outbreaks.
In addition to other geopolitical and terrorism risks, civil unrest continues to grow in a number of key countries
where we do business. Our ability to conduct business operations may be impacted by that civil unrest and our
assets in these countries may also be subject to expropriation by governments or other parties involved in civil
unrest. Epidemic outbreaks may also impact our business operations by, among other things, restricting travel to
protect the health and welfare of our employees and decisions by our customers to curtail or stop operations in
impacted areas.
Our business could be impacted by cybersecurity risks and threats.
Threats to our information technology systems associated with cybersecurity risks and cyber incidents or
attacks continue to grow and it is possible that breaches to our systems could go unnoticed for some period of time.
Risks associated with these threats include, among other things, loss of intellectual property, impairment of our
ability to conduct our operations, disruption of our customers’ operations, loss or damage to our customer data
delivery systems, and increased costs to prevent, respond to or mitigate cybersecurity events.
Our failure to comply with the Foreign Corrupt Practices Act (“FCPA”) could have a negative impact on our ongoing
operations.
Our ability to comply with the FCPA is dependent on the success of our ongoing compliance program, including
our ability to continue to manage our agents and business partners, and supervise, train and retain competent
employees. Our compliance program is also dependent on the efforts of our employees to comply with applicable
law and the Baker Hughes Business Code of Conduct. We could be subject to sanctions and civil and criminal
prosecution as well as fines and penalties in the event of a finding of a violation of the FCPA by us or any of our
employees.
Compliance with and changes in laws could be costly and could affect operating results. In addition, government
disruptions could negatively impact our ability to conduct our business.
We have operations in the U.S. and in more than 80 countries that can be impacted by expected and
unexpected changes in the legal and business environments in which we operate. Compliance related issues could
also limit our ability to do business in certain countries and impact our earnings. Changes that could impact the
legal environment include new legislation, new regulations, new policies, investigations and legal proceedings and
new interpretations of existing legal rules and regulations, in particular, changes in export control laws or exchange
control laws, additional restrictions on doing business in countries subject to sanctions, and changes in laws in
countries where we operate or intend to operate. In addition, government disruptions, such as a U.S. government
shutdown, may delay or halt the granting and renewal of permits, licenses and other items required by us and our
customers to conduct our business.
Changes in tax laws or tax rates, adverse positions taken by taxing authorities and tax audits could impact
operating results.
Changes in tax laws or tax rates, the resolution of tax assessments or audits by various tax authorities, and the
ability to fully utilize our tax loss carryforwards and tax credits could impact operating results. In addition, we may
periodically restructure our legal entity organization. If taxing authorities were to disagree with our tax positions in
connection with any such restructurings, our effective tax rate could be materially impacted.
Our tax filings for various periods are subject to audit by the tax authorities in most jurisdictions where we
conduct business. We have received tax assessments from various taxing authorities and are currently at varying
stages of appeals and/or litigation regarding these matters. These audits may result in assessment of additional