DuPont 2011 Annual Report Download - page 39

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Table of Contents
Part II
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK, continued
Sensitivity Analysis
The following table illustrates the fair values of outstanding derivative contracts at December 31, 2011 and 2010, and the effect on fair values of a
hypothetical adverse change in the market prices or rates that existed at December 31, 2011 and 2010. The sensitivity for interest rate swaps is based on a one
percent change in the market interest rate. Foreign currency and commodity contracts sensitivities are based on a 10 percent change in market rates.
Fair Value
Asset/(Liability) Fair Value
Sensitivity
(Dollars in millions) 2011 2010 2011 2010
Interest rate swaps $ 66 $ 40 $ (40) $ (51)
Foreign currency contracts 154 53 (541) (697)
Commodity contracts (3) (72) (103) (79)
Since the company's risk management programs are highly effective, the potential loss in value for each risk management portfolio described above would be
largely offset by changes in the value of the underlying exposure.
Concentration of Credit Risk
The company maintains cash and cash equivalents, marketable securities, derivatives and certain other financial instruments with various financial
institutions. These financial institutions are generally highly rated and geographically dispersed and the company has a policy to limit the dollar amount of
credit exposure with any one institution.
As part of the company's financial risk management processes, it continuously evaluates the relative credit standing of all of the financial institutions that
service DuPont and monitors actual exposures versus established limits. The company has not sustained credit losses from instruments held at financial
institutions.
The company's sales are not materially dependent on any single customer. As of December 31, 2011, no one individual customer balance represented more
than 5 percent of the company's total outstanding receivables balance. Credit risk associated with its receivables balance is representative of the geographic,
industry and customer diversity associated with the company's global businesses.
The company also maintains strong credit controls in evaluating and granting customer credit. As a result, it may require that customers provide some type of
financial guarantee in certain circumstances. Length of terms for customer credit varies by industry and region.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The financial statements and supplementary data required by this Item are included herein, commencing on page F-1 of this report.
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