McKesson 2009 Annual Report Download - page 117

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McKESSON CORPORATION
FINANCIAL NOTES (Continued)
111
As previously reported, on January 26, 2007, we acquired Per-Se, which became a wholly owned subsidiary of
McKesson. Prior to its acquisition, Per-Se had publicly disclosed that in December 2004, the Securities and
Exchange Commission (“SEC”) issued a formal order of investigation relating to accounting matters at NDCHealth
Corporation (“NDCHealth,”) a then public company which was acquired by Per-Se in January 2006, prior to our
acquisition of Per-Se. In March 2005, NDCHealth restated its financial statements for the fiscal years ended May
28, 2004, May 30, 2003 and May 31, 2002 and for the fiscal quarters ended August 22, 2004 and August 29, 2005 to
correct errors relating to certain accounting matters. NDCHealth produced documents to the SEC and fully
cooperated with the SEC in its investigation. The SEC has taken testimony from a number of current and former
NDCHealth employees. There has been no activity in this matter for some time and the SEC has taken no action
against NDCHealth or its successor to date.
VI. Environmental Matters
Primarily as a result of the operation of our former chemical businesses, which were fully divested by 1987, we
are involved in various matters pursuant to environmental laws and regulations. We have received claims and
demands from governmental agencies relating to investigative and remedial actions purportedly required to address
environmental conditions alleged to exist at eight sites where we, or entities acquired by us, formerly conducted
operations and we, by administrative order or otherwise, have agreed to take certain actions at those sites, including
soil and groundwater remediation. In addition, we are one of multiple recipients of a New Jersey Department of
Environmental Protection Agency directive and a separate United States Environmental Protection Agency directive
relating to potential natural resources damages (“NRD”) associated with one of these eight sites. Although the
Company’s potential allocation under either directive cannot be determined at this time, we have agreed to
participate with a potentially responsible party (“PRP”) group in the funding of an NRD assessment, the costs of
which are reflected in the aggregate estimates set forth below.
Based on a determination by our environmental staff, in consultation with outside environmental specialists and
counsel, the current estimate of reasonably possible remediation costs for these eight sites is $11 million, net of
approximately $2 million that third parties have agreed to pay in settlement or we expect, based either on
agreements or nonrefundable contributions which are ongoing, to be contributed by third parties. The $11 million is
expected to be paid out between April 2009 and March 2029. Our estimated liability for these environmental
matters has been accrued in the accompanying consolidated balance sheets.
In addition, we have been designated as a PRP under the Superfund law for environmental assessment and
cleanup costs as the result of our alleged disposal of hazardous substances at 19 sites. With respect to these sites,
numerous other PRPs have similarly been designated and while the current state of the law potentially imposes joint
and several liability upon PRPs, as a practical matter, costs of these sites are typically shared with other PRPs. Our
estimated liability at those 19 sites is approximately $1 million. The aggregate settlements and costs paid by us in
Superfund matters to date have not been significant. The accompanying consolidated balance sheets include this
environmental liability.
VII. Other Matters
We are involved in various other litigation and governmental proceedings, not described above, that arise in the
normal course of business. While it is not possible to determine with certainty the ultimate outcome or the duration
of any such litigation or governmental proceedings, we believe based on current knowledge and the advice of our
counsel that such litigation and proceedings will not have a material impact on our financial position or results of
operations.
19. Stockholders’ Equity
Each share of the Company’s outstanding common stock is permitted one vote on proposals presented to
stockholders and is entitled to share equally in any dividends declared by the Company’s Board of Directors (the
“Board”).