General Mills (GIS)

Foreign currency fluctuations affect our net investments in foreign subsidiaries and foreign currency cash flows related to third party purchases, intercompany loans, and product shipments. We are also exposed to the translation of foreign currency earnings to the U.S. dollar. Our principal exposures are to the Australian dollar, British pound sterling, Canadian dollar, Chinese renminbi, euro, Japanese yen, and Mexican peso. We mainly use foreign currency forward contracts to selectively hedge our foreign currency cash flow exposures. We generally do not hedge more than 12 months forward and generally do not hedge intercompany transactions. We also have many net investments in foreign subsidiaries that are denominated in euros. We hedge a portion of these net investments by issuing euro-denominated commercial paper. As of May 25, 2008, we had issued $472.9 million of euro-denominated commercial paper and foreign exchange forward contracts that we have designated as a net investment hedge and thus deferred net foreign currency transaction losses of $69.6 million to accumulated other comprehensive income (loss).

 

Foreign currency fluctuations affect our net investments in
foreign subsidiaries and foreign currency cash flows related to
third party purchases, intercompany loans, and product
shipments. We are also exposed to the translation of foreign
currency earnings to the U.S. dollar. Our principal
exposures are to the Australian dollar, British pound sterling,
Canadian dollar, Chinese renminbi, euro, Japanese yen, and
Mexican peso. We mainly use foreign currency forward contracts
to selectively hedge our foreign currency cash flow exposures.
We generally do not hedge more than 12 months forward and
generally do not hedge intercompany transactions. We also have
many net investments in foreign subsidiaries that are
denominated in euros. We hedge a portion of these net
investments by issuing euro-denominated commercial paper. As of
May 25, 2008, we had issued $472.9 million of
euro-denominated commercial paper and foreign exchange forward
contracts that we have designated as a net investment hedge and
thus deferred net foreign currency transaction losses of
$69.6 million to accumulated other comprehensive income
(loss).