Dow Chemical 2013 Annual Report Download - page 44

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22
Pension and Other Postretirement Benefits: Increased obligations and expenses related to the Company's defined
benefit pension plans and other postretirement benefit plans could negatively affect Dow's financial condition and
results of operations.
The Company has defined benefit pension plans and other postretirement benefit plans (the “plans”) in the United States and a
number of other countries. The assets of the Company's funded plans are primarily invested in fixed income and equity
securities of U.S. and foreign issuers. Changes in the market value of plan assets, investment returns, discount rates, mortality
rates, regulations and the rate of increase in compensation levels may affect the funded status of the Company's plans and could
cause volatility in the net periodic benefit cost, future funding requirements of the plans and the funded status of the plans. A
significant increase in the Company's obligations or future funding requirements could have a negative impact on the
Company's results of operations and cash flows for a particular period and on the Company's financial condition.
Implementation of ERP system: The Company's implementation of a new enterprise resource planning
(“ERP”) system may adversely affect the Company's business and results of operations or the effectiveness of
internal control over financial reporting.
Beginning in the first quarter of 2011, the Company began business implementation of a new ERP system that will deliver
a new generation of work processes and information systems. ERP implementations are complex and time-consuming
projects that involve substantial expenditures on system software and implementation activities that take several years.
ERP implementations also require transformation of business and financial processes in order to reap the benefits of the
ERP system. The staging of implementation allows a gradual build of risk in terms of business impact. The Company
expects to complete its ERP system implementation in 2014. If the Company does not effectively implement the ERP
system as planned or if the system does not operate as intended, it could adversely affect financial reporting systems, the
Company's ability to produce financial reports, and/or the effectiveness of internal control over financial reporting.