McKesson 2013 Annual Report Download - page 27

Download and view the complete annual report

Please find page 27 of the 2013 McKesson annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 128

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128

21
McKESSON CORPORATION
Volatility and disruption to the global capital and credit markets may adversely affect our ability to access credit, our cost
of credit and the financial soundness of our customers and suppliers.
Volatility and disruption in the global capital and credit markets, including the bankruptcy or restructuring of certain
financial institutions, reduced lending activity by other financial institutions, decreased liquidity and increased costs in the
commercial paper market and the reduced market for securitizations, may adversely affect the availability and cost of credit
already arranged and the availability, terms and cost of credit in the future, including any arrangements to renew or replace
our current credit or financing arrangements. Although we believe that our operating cash flow, financial assets, current
access to capital and credit markets, including our existing credit and sales facilities, will give us the ability to meet our
financing needs for the foreseeable future, there can be no assurance that continued or increased volatility and disruption in
the global capital and credit markets will not impair our liquidity or increase our costs of borrowing.
Our $1.35 billion accounts receivable sales facility is generally renewed annually and will expire in May 2013.
Historically, we have primarily used the accounts receivable sales facility to fund working capital requirements, as needed.
We anticipate extending or renewing this facility before its expiration. Although we believe we will be able to renew this
facility, there is no assurance that we will be able to do so.
Our business could also be negatively impacted if our customers or suppliers experience disruptions resulting from
tighter capital and credit markets or a slowdown in the general economy. As a result, customers may modify, delay or cancel
plans to purchase or implement our products or services and suppliers may increase their prices, reduce their output or change
their terms of sale. Additionally, if customers' or suppliers' operating and financial performance deteriorates or if they are
unable to make scheduled payments or obtain credit, customers may not be able to pay, or may delay payment of accounts
receivable owed to us and suppliers may restrict credit, impose different payment terms or be unable to make payments due to
us for fees, returned products or incentives. Any inability of customers to pay us for our products and services or any demands
by suppliers for different payment terms may have a material adverse impact on our results of operations and cash flow.
Changes in accounting standards issued by the Financial Accounting Standards Board (“FASB”) or other standard-
setting bodies may adversely affect our financial statements.
Our financial statements are subject to the application of U.S. GAAP, which is periodically revised and/or expanded.
Accordingly, from time-to-time we are required to adopt new or revised accounting standards issued by recognized
authoritative bodies, including the FASB and the SEC. It is possible that future accounting standards we are required to adopt
could change the current accounting treatment that we apply to our consolidated financial statements and that such changes
could have a material adverse impact on our results of operations and financial condition.
Item 1B. Unresolved Staff Comments.
None.
Item 2. Properties.
Because of the nature of our principal businesses, our plant, warehousing, office and other facilities are operated in
widely dispersed locations, mostly throughout the U.S. and Canada. The warehouses are typically owned or leased on a long-
term basis. We consider our operating properties to be in satisfactory condition and adequate to meet our needs for the next
several years without making capital expenditures materially higher than historical levels. Information as to material lease
commitments is included in Financial Note 20, “Lease Obligations,” to the consolidated financial statements appearing in this
Annual Report on Form 10-K.
Item 3. Legal Proceedings.
Certain legal proceedings in which we are involved are discussed in Financial Note 22, “Other Commitments and
Contingent Liabilities,” to the consolidated financial statements appearing in this Annual Report on Form 10-K.
Item 4. Mine Safety Disclosures.
Not applicable.