Kraft 2009 Annual Report Download - page 57

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As of December 31, 2009, the estimated potential one-day loss in fair value of our interest rate-sensitive instruments, primarily debt, under normal
market conditions and the estimated potential one-day loss in pre-tax earnings from our foreign currency and commodity instruments under normal
market conditions, as calculated in the VAR model, were (in millions):
Pre-Tax Earnings Impact Fair Value Impact
At 12/31/09 Average High Low At 12/31/09 Average High Low
Instruments sensitive
to:
Interest rates $ 123 $ 175 $ 239 $ 114
Foreign currency
rates $ 8 $ 11 $ 15 $ 8
Commodity prices 31 30 36 24
Pre-Tax Earnings Impact Fair Value Impact
At 12/31/08 Average High Low At 12/31/08 Average High Low
Instruments sensitive
to:
Interest rates $ 175 $ 161 $ 216 $ 106
Foreign currency
rates $ 19 $ 15 $ 21 $ 8
Commodity prices 43 66 91 43
This VAR computation is a risk analysis tool designed to statistically estimate the maximum probable daily loss from adverse movements in
interest rates, foreign currency rates and commodity prices under normal market conditions. The computation does not represent actual losses in
fair value or earnings to be incurred by Kraft Foods, nor does it consider the effect of favorable changes in market rates. We cannot predict actual
future movements in such market rates and do not present these VAR results to be indicative of future movements in such market rates or to be
representative of any actual impact that future changes in market rates may have on our future financial results.
54
Source: KRAFT FOODS INC, 10-K, February 25, 2010 Powered by Morningstar® Document Research℠