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McKESSON CORPORATION
FINANCIAL NOTES (Continued)
65
On April 1, 2011, we adopted amended accounting guidance for vendors who apply the milestone method of
revenue recognition to research and development arrangements. The amended guidance applies to arrangements
with payments that are contingent, at inception, upon achieving substantively uncertain future events or
circumstances. The amended guidance was adopted on a prospective basis for milestones achieved on or after
April 1, 2011. The adoption of this amended guidance did not have a material effect on our consolidated financial
statements.
Fair Value Measurements and Disclosures: In 2012, we adopted amended guidance related to clarification on
how to measure fair values and additional disclosure requirements related to fair value measurements and the roll-
forward activity of Level 3 fair value measurements, which are measured based on significant unobservable inputs.
The adoption of this amended guidance did not have a material effect on our consolidated financial statements.
Goodwill: In 2012, we adopted amended guidance related to goodwill impairment testing. The amended
guidance provides the option to perform a qualitative assessment by applying a more likely than not determination
as to whether the fair value of a reporting unit is less than its carrying amount, which may then allow a company to
skip the annual two-step quantitative goodwill impairment test depending on the determination. This amended
guidance was effective for us commencing in the first quarter of 2013. Early adoption was permitted. The amended
guidance was early adopted and did not have a material effect on our consolidated financial statements.
Multiemployer Pension and Other Postretirement Benefit Plans: In 2012, we adopted amended guidance related
to an employer’s participation in multiemployer pension and other postretirement benefit plans, which require
employers to provide additional quantitative and qualitative disclosures for these types of plans. The amended
guidance was adopted on a retrospective basis. The adoption of this amended guidance did not have a material
effect on our consolidated financial statements.
Recently Issued Accounting Pronouncements Not Yet Adopted
In June 2011, amended guidance related to the presentation of other comprehensive income was issued. The
amended guidance requires that comprehensive income, the components of net income and the components of other
comprehensive income be presented either in a single continuous statement of comprehensive income or in two
separate but consecutive statements. While the new guidance changes the presentation of comprehensive income,
there are no changes to the components that are recognized in net income or other comprehensive income as
determined under current accounting guidance. In December 2011, an amendment to this guidance was issued,
which defers the requirement to present reclassification adjustments for each component of other comprehensive
income in both net income and other comprehensive income on the face of the financial statements. The amended
guidance is effective for us on a retrospective basis commencing in the first quarter of 2013. We do not expect the
adoption of the amended guidance to have a material effect on our consolidated financial statements.
In December 2011, disclosure guidance related to the offsetting of assets and liabilities was issued. The
guidance requires an entity to disclose information about offsetting and related arrangements for recognized
financial and derivative instruments to enable users of its financial statements to understand the effect of those
arrangements on its financial position. The amended guidance is effective for us on a retrospective basis
commencing in the first quarter of 2014. We are currently evaluating the impact of this new guidance on our
consolidated financial statements.
2. Business Combinations
On December 30, 2010, we acquired all of the outstanding shares of US Oncology Holdings, Inc. (“US
Oncology”) for approximately $2.1 billion, consisting of cash consideration of $0.2 billion, net of cash acquired, and
the assumption of liabilities with a fair value of $1.9 billion. The cash paid at acquisition was funded from cash on
hand. As an integrated oncology company, US Oncology is affiliated with community-based oncologists, and works
with patients, hospitals, payers and the medical industry across all phases of the cancer research and delivery
continuum. The acquisition of US Oncology expands our existing specialty pharmaceutical distribution business
and adds practice management services for oncologists. Financial results for US Oncology have been included in
the results of operations within our Distribution Solutions segment beginning in the fourth quarter of 2011.