3M 2010 Annual Report Download - page 46

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40
Item 7A. Quantitative and Qualitative Disclosures About Market Risk.
In the context of Item 7A, market risk refers to the risk of loss arising from adverse changes in financial and derivative
instrument market rates and prices, such as fluctuations in interest rates and foreign currency exchange rates. The
Company discusses risk management in various places throughout this document, including discussions in Item 7
concerning Financial Condition and Liquidity, and Financial Instruments, and in the Notes to Consolidated Financial
Statements (Long-Term Debt and Short-Term Borrowings, Derivatives, Fair Value Measurements, and the
Derivatives and Hedging Activities accounting policy). All derivative activity is governed by written policies, and a
value-at-risk analysis is provided for these derivatives. The Company does not have leveraged derivative positions.
However, the Company does have contingently convertible debt that, if conditions for conversion are met, is
convertible into shares of 3M common stock (refer to Note 10 in this document).