United Healthcare 2006 Annual Report Download - page 58

an investment policy authorized by our Board of Directors. This policy limits the amounts that may be invested
in any one issuer and generally limits our investments to U.S. Government and Agency securities, state and
municipal securities and corporate debt obligations that are investment grade. Concentrations of credit risk with
respect to accounts receivable are limited due to the large number of employer groups that constitute our
customer base. As discussed more fully in Note 5 of the Notes to our Consolidated Financial Statements, we have
an aggregate $2.0 billion reinsurance receivable resulting from the sale of our life and annuity business. We
regularly evaluate the financial condition of the reinsurer and only record the reinsurance receivable to the extent
that the amounts are deemed probable of recovery. As of December 31, 2006, there were no other significant
concentrations of credit risk.
Cautionary Statements
The statements, estimates, projections, guidance or outlook contained in this Annual Report on Form 10-K
include forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995
(PSLRA). When used in this Annual Report on Form 10-K and in future filings by us with the SEC, in our news
releases, presentations to securities analysts or investors, and in oral statements made by or with the approval of
one of our executive officers, the words or phrases “believes,” “anticipates,” “expects,” “plans,” “seeks,”
“intends,” “will likely result,” “estimates,” “projects” or similar expressions are intended to identify such
forward-looking statements. These statements are intended to take advantage of the “safe harbor” provisions of
the PSLRA. These forward-looking statements involve risks and uncertainties that may cause our actual results to
differ materially from the results discussed in the forward-looking statements.
The following discussion contains certain cautionary statements regarding our business that investors and others
should consider. Except to the extent otherwise required by federal securities laws, we do not undertake to
address or update forward-looking statements in future filings or communications regarding our business or
operating results, and do not undertake to address how any of these factors may have caused results to differ from
discussions or information contained in previous filings or communications. In addition, any of the matters
discussed below may have affected past, as well as current, forward-looking statements about future results. Any
or all forward-looking statements in this Form 10-K and in any other public filings or statements we make may
turn out to be wrong. They can be affected by inaccurate assumptions we might make or by known or unknown
risks and uncertainties. Many factors discussed below will be important in determining future results. By their
nature, forward-looking statements are not guarantees of future performance or results and are subject to risks,
uncertainties and assumptions that are difficult to predict or quantify. Actual future results may vary materially
from expectations expressed in this report or any of our prior communications.
Cautionary Statements Relating to Our Historic Stock Option Practices
Matters relating to or arising out of our historic stock option practices, including regulatory inquiries,
litigation matters, downgrades in our credit ratings, and potential additional cash and noncash charges
could have a material adverse effect on the Company.
As described in the Explanatory Note immediately preceding Part I, Item 1, and in Note 3 “Restatement of
Consolidated Financial Statements” of the Notes to Consolidated Financial Statements in this Form 10-K, in
early 2006, our Board of Directors initiated an independent review of the Company’s stock option practices from
1994 to 2005. The independent review was conducted by the Independent Committee with the assistance of
independent counsel, WilmerHale, and independent accounting advisors. On October 15, 2006, we announced
that the Independent Committee and WilmerHale had completed their review of the Company’s stock option
practices and reported the findings to the non-management directors of the Company. As a result of our historic
stock option practices, we restated, in this Form 10-K, our previously filed financial statements, we are subject to
various regulatory inquiries, litigation matters and credit rating downgrades, and we may be subject to further
cash and noncash charges, any or all of which could have a material adverse effect on us.
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