McKesson 2016 Annual Report Download - page 34

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McKESSON CORPORATION
applies to our foreign operations is subject to varying interpretations arising from the complex nature of the tax
laws and regulations. Although we believe that our historical tax positions are sound and consistent with
applicable laws, regulations and existing precedent, there can be no assurance that these tax positions will not be
challenged by relevant tax authorities or that we would be successful in any such challenge. Even if we are
successful in maintaining our positions, we may incur significant expense in defending challenges to our tax
positions by tax authorities that could have a material impact on our financial position and results of operations.
In addition, as jurisdictions enact legislation to implement the recommendations of the recently concluded
base erosion and profit shifting project undertaken by the Organization for Economic Cooperation and
Development or as a result of the European Commission’s investigations into illegal state aid, changes to long-
standing tax principles may result which could adversely impact our tax expense.
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 volatility and disruption in the global capital and credit markets will not impair our
liquidity or increase our costs of borrowing.
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. 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, such as the amended guidance for revenue recognition, leases, and share based payments, may
require changes to the current accounting treatment that we apply to our consolidated financial statements and
may require us to make significant changes to our systems. Such changes could result in a material adverse
impact on our financial position and results of operations.
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