Coca Cola 2008 Annual Report Download - page 21

reduce our after-tax income from affected jurisdictions, while increases in indirect taxes could affect our
products’ affordability and therefore reduce demand for our products.
If we are not able to achieve our overall long-term goals, the value of an investment in our Company could be negatively
affected.
We have established and publicly announced certain long-term growth objectives. These objectives were
based on our evaluation of our growth prospects, which are generally based on volume and sales potential of
many product types, some of which are more profitable than others, and on an assessment of a potential level or
mix of product sales. There can be no assurance that we will achieve the required volume or revenue growth or
the mix of products necessary to achieve our long-term growth objectives.
If we are unable to protect our information systems against data corruption, cyber-based attacks or network security
breaches, our operations could be disrupted.
We rely on information technology networks and systems, including the Internet, to process, transmit and
store electronic information. In particular, we depend on our information technology infrastructure for digital
marketing activities and electronic communications among our locations around the world and between
Company personnel and our bottlers and other customers and suppliers. Security breaches of this infrastructure
can create system disruptions, shutdowns or unauthorized disclosure of confidential information. If we are
unable to prevent such breaches, our operations could be disrupted, or we may suffer financial damage or loss
because of lost or misappropriated information.
We may be required to recognize additional impairment charges.
We assess our goodwill, trademarks and other intangible assets and our long-lived assets as and when
required by accounting principles generally accepted in the United States to determine whether they are
impaired. In 2008, we recorded charges of approximately $1.6 billion to equity income, which represented our
proportionate share of impairment charges recorded by CCE. In addition, the Company recorded a charge of
approximately $81 million related to other-than-temporary declines in the fair value of certain available-for-sale
securities. In 2007, we recorded net charges of approximately $150 million related to our proportionate share of
impairment and restructuring charges partially offset by our proportionate share of tax rate changes recorded by
certain equity investees. In 2006, we recorded a charge of approximately $602 million to equity income resulting
from the impact of our proportionate share of an impairment charge recorded by CCE, and impairment charges
of approximately $41 million primarily related to trademarks for beverages sold in the Philippines and
Indonesia. Refer to the heading ‘‘Critical Accounting Policies and Estimates—Recoverability of Noncurrent
Assets’’ of ‘‘Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations’’
of this report for additional discussion of impairment charges.
If we do not successfully manage our Company-owned bottling operations, our results could suffer.
While we primarily manufacture, market and sell concentrates and syrups to our bottling partners, from
time to time we do acquire or take control of bottling operations and have increasingly done so in recent years.
As of December 31, 2008, the net operating revenues generated by Company-owned and controlled bottling
operations (which are included in the Bottling Investments operating segment) represented approximately
27 percent of our Company’s consolidated net operating revenues. Often, though not always, these acquired
bottling operations are in underperforming markets where we believe we can use our resources and expertise to
improve performance. Acquisitions and consolidation of controlled bottling operations during 2008 and 2007
have resulted in a substantial increase in the number of Company-owned bottling plants included in our
consolidated financial statements and in the number of our associates. We may incur unforeseen liabilities and
obligations in connection with acquiring, taking control of or managing bottling operations and may encounter
unexpected difficulties and costs in restructuring and integrating them into our Company’s operating and
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