CLOROX CO /DE/, 10-K filed on 8/26/2010
Annual Report
Document and Entity Information (USD $)
Year Ended
Jun. 30, 2010
Document Information
 
Document Type
10-K 
Amendment Flag
FALSE 
Document Period End Date
2010-06-30 
Document Fiscal Year Focus
2010 
Document Fiscal Period Focus
FY 
Entity Registrant Name
CLOROX CO /DE/ 
Entity Central Index Key
0000021076 
Current Fiscal Year End Date
06/30 
Entity Filer Category
Large Accelerated Filer 
Entity Common Stock, Shares Outstanding
138,931,910 
Entity Public Float
$ 8,500,000,000 
Entity Well-known Seasoned Issuer
Yes 
Entity Voluntary Filers
No 
Entity Current Reporting Status
Yes 
CONSOLIDATED STATEMENTS OF EARNINGS (USD $)
In Millions, except Share data in Thousands, unless otherwise specified
Year Ended
Jun. 30,
2010
2009
2008
Net sales
$ 5,534 
$ 5,450 
$ 5,273 
Cost of products sold
3,057 
3,104 
3,098 
Gross profit
2,477 
2,346 
2,175 
Selling and administrative expenses
747 
715 
690 
Advertising costs
518 
499 
486 
Research and development costs
119 
114 
111 
Restructuring and asset impairment costs
4 
20 
36 
Interest expense
139 
161 
168 
Other expense (income), net
25 
26 
(9)
Earnings before income taxes
925 
811 
693 
Income taxes
322 
274 
232 
Net earnings
603 
537 
461 
Earnings per share
 
 
 
Basic
4.28 
3.82 
3.27 
Diluted
$ 4.24 
$ 3.79 
$ 3.23 
Weighted average shares outstanding (in thousands)
 
 
 
Basic
140,272 
139,015 
139,633 
Diluted
141,534 
140,169 
141,197 
CONSOLIDATED BALANCE SHEETS (USD $)
In Millions
Year Ended
Jun. 30,
2010
2009
ASSETS
 
 
Cash and cash equivalents
$ 87 
$ 206 
Receivables, net
544 
486 
Inventories, net
367 
366 
Other current assets
126 
122 
Total current assets
1,124 
1,180 
Property, plant and equipment, net
979 
955 
Goodwill
1,650 
1,630 
Trademarks, net
562 
557 
Other intangible assets, net
96 
105 
Other assets
144 
149 
Total assets
4,555 
4,576 
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
 
 
Notes and loans payable
371 
421 
Current maturities of long-term debt
300 
577 
Accounts payable
410 
381 
Accrued liabilities
492 
472 
Income taxes payable
74 
86 
Total current liabilities
1,647 
1,937 
Long-term debt
2,124 
2,151 
Other liabilities
677 
640 
Deferred income taxes
24 
23 
Total liabilities
4,472 
4,751 
Commitments and contingencies
 
 
Stockholders' equity (deficit)
 
 
Common stock: $1.00 par value; 750,000,000 shares authorized; 158,741,461 shares issued at June 30, 2010 and 2009; and 138,764,511 and 139,157,976 shares outstanding at June 30, 2010 and June 30, 2009, respectively
159 
159 
Additional paid-in capital
617 
579 
Retained earnings
920 
640 
Treasury shares, at cost: 19,976,950 and 19,583,485 shares at June 30, 2010 and June 30, 2009, respectively
(1,242)
(1,206)
Accumulated other comprehensive net losses
(371)
(347)
Stockholders' equity (deficit)
83 
(175)
Total liabilities and stockholders' equity (deficit)
$ 4,555 
$ 4,576 
CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $)
Jun. 30, 2010
Jun. 30, 2009
Common stock, par value
$ 1 
$ 1 
Common stock, shares, authorized
750,000,000 
750,000,000 
Common stock, shares, issued
158,741,461 
158,741,461 
Common stock, shares, outstanding
138,764,511 
139,157,976 
Treasury stock, shares
19,976,950 
19,583,485 
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT)
In Millions, except Share data
Common Stock [Member]
Additional Paid-in Capital [Member]
Retained Earnings [Member]
Treasury Shares [Member]
Accumulated Other Comprehensive Net (Losses) Gains [Member]
Total Comprehensive Income [Member]
Total
Balance, shares at Jun. 30, 2007
158,741 
 
 
(7,485)
 
 
 
Balance, amount at Jun. 30, 2007
159 
481 
185 
(445)
(209)
 
171 
Net earnings
 
 
461 
 
 
461 
461 
Translation adjustments, net of tax
 
 
 
 
26 
26 
26 
Change in valuation of derivatives, net of tax
 
 
 
 
27 
27 
27 
Pension and postretirement benefit adjustments, net of tax
 
 
 
 
(23)
(23)
(23)
Total comprehensive income
 
 
 
 
 
491 
 
Cumulative effect of adopting new accounting guidance related to uncertain tax positions
 
 
(10)
 
 
 
(10)
Dividends
 
 
(231)
 
 
 
(231)
Employee stock plans, shares
 
 
 
862 
 
 
 
Employee stock plans, amount
 
53 
(19)
48 
 
 
82 
Treasury stock purchased, shares
 
 
 
(14,080)
 
 
 
Treasury stock purchased, amount
 
 
 
(868)
 
 
(868)
Other
 
 
 
(5)
 
 
(5)
Balance, shares at Jun. 30, 2008
158,741 
 
 
(20,703)
 
 
 
Balance, amount at Jun. 30, 2008
159 
534 
386 
(1,270)
(179)
 
(370)
Net earnings
 
 
537 
 
 
537 
537 
Translation adjustments, net of tax
 
 
 
 
(78)
(78)
(78)
Change in valuation of derivatives, net of tax
 
 
 
 
(39)
(39)
(39)
Pension and postretirement benefit adjustments, net of tax
 
 
 
 
(51)
(51)
(51)
Total comprehensive income
 
 
 
 
 
369 
 
Dividends
 
 
(264)
 
 
 
(264)
Employee stock plans, shares
 
 
 
1,120 
 
 
 
Employee stock plans, amount
 
40 
(17)
64 
 
 
87 
Other
 
5 
(2)
 
 
 
3 
Balance, shares at Jun. 30, 2009
158,741 
 
 
(19,583)
 
 
 
Balance, amount at Jun. 30, 2009
159 
579 
640 
(1,206)
(347)
 
(175)
Net earnings
 
 
603 
 
 
603 
603 
Translation adjustments, net of tax
 
 
 
 
9 
9 
9 
Change in valuation of derivatives, net of tax
 
 
 
 
10 
10 
10 
Pension and postretirement benefit adjustments, net of tax
 
 
 
 
(43)
(43)
(43)
Total comprehensive income
 
 
 
 
 
579 
 
Dividends
 
 
(290)
 
 
 
(290)
Employee stock plans, shares
 
 
 
1,980 
 
 
 
Employee stock plans, amount
 
38 
(26)
114 
 
 
126 
Treasury stock purchased, shares
 
 
 
(2,374)
 
 
 
Treasury stock purchased, amount
 
 
 
(150)
 
 
(150)
Other
 
 
(7)
 
 
 
(7)
Balance, shares at Jun. 30, 2010
158,741 
 
 
(19,977)
 
 
 
Balance, amount at Jun. 30, 2010
159 
617 
920 
(1,242)
(371)
 
83 
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (DEFICIT) (Parenthetical) (USD $)
In Millions
Year Ended
Jun. 30,
2010
2009
2008
Translation Adjustments
$ 1 
$ 5 
$ 2 
Change in valuation of derivatives
4 
24 
17 
Pension and postretirement benefit adjustments
$ 26 
$ 31 
$ 15 
CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $)
In Millions
Year Ended
Jun. 30,
2010
2009
2008
Operating activities:
 
 
 
Net earnings
$ 603 
$ 537 
$ 461 
Adjustments to reconcile earnings from continuing operations to net cash provided by continuing operations:
 
 
 
Depreciation and amortization
185 
190 
205 
Share-based compensation
60 
58 
47 
Deferred income taxes
24 
(1)
(51)
Asset impairment costs
 
3 
29 
Other
(15)
3 
23 
Changes in:
 
 
 
Receivables, net
(53)
(2)
(8)
Inventories, net
2 
 
(26)
Other current assets
(8)
(4)
11 
Accounts payable and accrued liabilities
35 
(40)
63 
Income taxes payable
(14)
(6)
(24)
Net cash provided by operations
819 
738 
730 
Investing activities:
 
 
 
Capital expenditures
(203)
(197)
(170)
Business acquired, net of cash acquired
(19)
 
(913)
Other
(9)
 
1 
Net cash used for investing activities
(231)
(197)
(1,082)
Financing activities:
 
 
 
Notes and loans payable, net
(52)
(334)
681 
Long-term debt borrowings, net of issuance costs
296 
11 
1,256 
Long-term debt repayments
(598)
 
(500)
Treasury stock purchased
(150)
 
(868)
Cash dividends paid
(282)
(258)
(228)
Issuance of common stock for employee stock plans and other
80 
41 
39 
Net cash (used for) provided by financing activities
(706)
(540)
380 
Effect of exchange rate changes on cash and cash equivalents
(1)
(9)
4 
Net (decrease) increase in cash and cash equivalents
(119)
(8)
32 
Cash and cash equivalents:
 
 
 
Beginning of year
206 
214 
182 
End of year
87 
206 
214 
Supplemental cash flow information:
 
 
 
Interest paid
149 
161 
153 
Income taxes paid, net of refunds
301 
275 
299 
Non-cash financing activities:
 
 
 
Dividends declared and accrued but not paid
$ 78 
$ 70 
$ 64 
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
 
Nature of Operations and Basis of Presentation
 
The Company is principally engaged in the production, marketing and sales of consumer products through mass merchandisers, grocery stores and other retail outlets. The consolidated financial statements include the statements of the Company and its majority-owned and controlled subsidiaries. All significant intercompany transactions and accounts were eliminated in consolidation. Certain prior year reclassifications were made in the consolidated financial statements and related notes to consolidated financial statements to conform to the current year presentation.
 
Use of Estimates
 
The preparation of these consolidated financial statements in conformity with accounting principles generally accepted in the United States of America (U.S. GAAP) requires management to make estimates and assumptions that affect reported amounts and related disclosures. Specific areas requiring the application of management's estimates and judgment include assumptions pertaining to accruals for consumer and trade-promotion programs, share-based compensation costs, pension and post-employment benefit costs, future cash flows associated with impairment testing of goodwill and other long-lived assets, credit worthiness of customers, uncertain tax positions, tax valuation allowances and legal, environmental and insurance matters. Actual results could materially differ from estimates and assumptions made.
 
Foreign Currency Translation
 
Other than Venezuela, which operates in a highly inflationary economy, local currencies are the functional currencies for substantially all of the Company's other foreign operations. When the transactional currency is different than the functional currency, transaction gains and losses are included as a component of other expense (income), net. In addition, certain assets and liabilities denominated in currencies different than a foreign subsidiary's functional currency are reported on the subsidiary's books in its functional currency, with the impact from exchange rate differences recorded in other expense (income), net. Assets and liabilities of foreign operations are translated into U.S. dollars using the exchange rates in effect at the balance sheet date. Income and expenses are translated at the average monthly exchange rates during the year. Gains and losses on foreign currency translations are reported as a component of other comprehensive income. Deferred taxes are not provided on cumulative translation adjustments where the Company expects earnings of a foreign subsidiary to be indefinitely reinvested. The income tax effect of currency translation adjustments related to foreign subsidiaries from certain subsidiaries and joint ventures that are not considered indefinitely reinvested is recorded as a component of deferred taxes with an offset to other comprehensive income.

Venezuela
 
Prior to December 31, 2009, the Company translated its Venezuelan subsidiary's financial statements using Venezuela's official currency exchange rate, which had been fixed by the Venezuelan government at 2.15 bolivar fuertes (VEFs) to the U.S. dollar. Effective December 31, 2009, the Company began translating its Venezuelan subsidiary's financial statements using the parallel market currency exchange rate (exchange rates negotiated with local financial intermediaries), the rate at which the Company expected to be able to remit dividends or return capital. The rate used at December 31, 2009, was 5.87 VEFs to the U.S. dollar. On a pre-tax basis, this change in the rate used for converting these currencies resulted in a one time re-measurement loss of $12 during the Company's fiscal quarter ended December 31, 2009, which related primarily to U.S. dollar denominated inventory purchases.
 
Effective January 1, 2010, the financial statements for the Company's Venezuelan subsidiary have been consolidated under the rules governing the translation of financial information in a highly inflationary economy. Under U.S. GAAP, an economy is considered highly inflationary if the cumulative inflation rate for a three-year period meets or exceeds 100 percent. If a subsidiary is considered to be in a highly inflationary economy, the financial statements of the subsidiary must be re-measured into the Company's reporting currency (U.S. dollar) and future exchange gains and losses from the re-measurement of non-U.S. dollar monetary assets and liabilities are reflected in current net earnings, rather than exclusively in the equity section of the balance sheet, until such time as the economy is no longer considered highly inflationary. Nonmonetary assets and liabilities, such as inventory, property, plant and equipment and prepaid expenses are recorded in U.S. dollars at the historical rates at the time of acquisition of such assets or liabilities.
 
In May 2010, the Venezuela government suspended the functioning of the parallel currency exchange market and in June 2010, the Venezuela Central Bank established an alternative currency exchange market. This alternative market includes volume restrictions on the amount of U.S. dollars which may be converted each month. In June 2010, the Company began utilizing the exchange rate at which the Company was purchasing U.S. dollars through the alternative market, which was 5.3 VEFs to the U.S. dollar, as the translation rate for the Company's Venezuelan subsidiary's financial statements. Accordingly, the Company recorded a gain in other expense (income), net of $2 during the fiscal quarter ended June 30, 2010.
 
At June 30, 2010, the net asset position of the Company's Venezuelan subsidiary was $4, which included cash balances of approximately $8, of which approximately $6 was denominated in VEFs. Of the $4 net asset position, approximately $11 was associated with VEFs-denominated monetary net assets and deferred income taxes. For the fiscal year 2010, Venezuela's net sales and total assets represented approximately 2% and 1% of the total Company's net sales and total assets, respectively.
 
New Accounting Pronouncements
 
On June 30, 2010, the Company adopted a new accounting standard that requires additional disclosures about the major categories of plan assets and concentrations of risk for an employer's plan assets of a defined benefit pension and other postretirement plan, as well as disclosure of fair value levels, similar to the disclosure requirements of the fair value measurements accounting standard (See Note 20). As this guidance only requires enhanced disclosures, which the Company has provided, its adoption did not have a material impact on the consolidated financial statements.
 
On July 1, 2009, the Company adopted a new accounting standard that provides that unvested share-based payment awards that contain nonforfeitable rights to dividends or dividend equivalents, whether paid or unpaid, are participating securities that must be included in the computation of earnings per share pursuant to the two-class method. These payment awards were previously not considered participating securities. Accordingly, the Company's unvested performance units, restricted stock awards and restricted stock units that provide such nonforfeitable rights are now considered participating securities in the calculation of net earnings per share (EPS). The Company's share-based payment awards granted in fiscal year 2010 are not participating securities. The new standard requires the retrospective adjustment of the Company's earnings per share data. The impact of the retrospective adoption of the new accounting standard on the fiscal year 2009 and 2008 reported EPS data was as follows:
 
Basic Diluted
As previously As previously
      reported       As restated       reported       As restated
Year ended June 30, 2009   $        3.86   $        3.82   $        3.81   $        3.79
Year ended June 30, 2008 3.30 3.27 3.24 3.23

The calculation of EPS under the new accounting standard is disclosed in Note 15.
 
On July 1, 2009, the Company adopted a new accounting standard that establishes principles and requirements for how the acquirer of a business recognizes and measures in its financial statements the identifiable assets acquired, the liabilities assumed, including contingent liabilities, and any noncontrolling interest in an acquired business. The new accounting standard also provides for recognizing and measuring the goodwill acquired in a business combination and requires disclosure of information to enable users of the financial statements to evaluate the nature and financial effects of the business combination. The provisions of this standard were applied during the Company's most recent acquisition (See Note 2).
 
On July 1, 2009, the Company adopted a new accounting standard that requires disclosures about fair value of financial instruments in interim financial information. The Company already complies with the provisions of this accounting standard for its annual reporting.
 
On July 1, 2009, the Company adopted the provisions of the accounting standard on fair value measurements that apply to nonfinancial assets and liabilities that are recognized or disclosed at fair value on a non-recurring basis. The adoption of these provisions did not have an impact on the consolidated financial statements or disclosures.
 
On July 1, 2009, the Company adopted a new accounting standard that establishes new accounting and reporting standards for the noncontrolling interest in a subsidiary (commonly referred to as minority interest) and for the deconsolidation of a subsidiary. The new standard establishes accounting and reporting standards that require the noncontrolling interest to be reported as a component of equity. Changes in a parent's ownership interest while the parent retains its controlling interest are accounted for as equity transactions and any retained noncontrolling equity investment upon the deconsolidation of a subsidiary are initially measured at fair value. The adoption of the new standard did not have an impact to the consolidated financial statements.
On June 30, 2009, the Company adopted a new accounting standard that establishes principles and requirements for subsequent events. The statement details the period after the balance sheet date during which the Company should evaluate events or transactions that may occur for potential recognition or disclosure in the financial statements, the circumstances under which the Company should recognize events or transactions occurring after the balance sheet date in its financial statements and the required disclosures for such events. The adoption of the new standard did not have an impact on the consolidated financial statements.
 
On January 1, 2009, the Company adopted a new accounting standard that requires disclosures of how and why a company uses derivative instruments, how derivative instruments and related hedged items are accounted for and how derivative instruments and related hedged items affect a company's financial position, financial performance and cash flows (See Note 11). As this guidance only requires enhanced disclosures, which the Company has provided, its adoption did not have a material impact on the consolidated financial statements.
 
On July 1, 2008, the Company adopted the required portions of a new accounting standard on fair value measurements, and its adoption did not have a material impact to the consolidated financial statements (See Note 11). This standard defines fair value, establishes a framework for measuring fair value in accordance with U.S. GAAP and expands disclosures about fair value measurements.
 
In February 2007, the Financial Accounting Standards Board issued a new accounting standard that permits entities to choose to measure many financial instruments and certain other items at fair value. This standard was effective for the Company beginning July 1, 2008. The Company has not applied the fair value option to any items; therefore, the adoption of the standard did not have an impact on the consolidated financial statements.
 
On July 1, 2007, the Company adopted a new accounting standard that prescribes a consistent recognition threshold and measurement standard, as well as criteria for subsequently recognizing, derecognizing, classifying and measuring tax positions for financial statement purposes. The cumulative effect of adopting this standard was recorded as a $10 reduction to beginning retained earnings. The standard requires uncertain tax positions to be classified as non-current income tax liabilities unless expected to be paid within one year. Upon adoption of the standard, income tax liabilities of $53 were reclassified from current to non-current on the Company's balance sheet.

Cash and Cash Equivalents
 
Cash equivalents consist of highly liquid instruments, time deposits and money market funds with an initial maturity at purchase of three months or less. The fair value of cash and cash equivalents approximates the carrying amount.
 
The Company's cash position includes amounts held by foreign subsidiaries, and the repatriation of certain cash balances from some of the Company's foreign subsidiaries could result in additional tax costs. However, these cash balances are generally available without legal restriction to fund local business operations. In addition, a portion of the Company's cash balances are held in U.S. dollars by foreign subsidiaries, whose functional currency is their local currency. Such U.S. dollar balances are reported on the foreign subsidiaries books, in their functional currency, with the impact from exchange rate differences recorded in other expense (income), net. The Company's cash holdings as of the end of fiscal years 2010 and 2009 were as follows:
 
2010       2009
Non-U.S. dollar balances held by non-U.S. dollar functional currency subsidiaries $ 42 $ 74
U.S. dollar balances held by non-U.S. dollar functional currency subsidiaries 13     52
Non-U.S. dollar balances held by U.S. dollar functional currency subsidiaries   7 13
U.S. dollar balances including those balances held by U.S. dollar functional currency subsidiaries 25 67
Total $        87 $        206
 
Inventories
 
Inventories are stated at the lower of cost or market. When necessary, the Company provides allowances to adjust the carrying value of its inventory to the lower of cost or market, including any costs to sell or dispose. Appropriate consideration is given to obsolescence, excessive inventory levels, product deterioration and other factors in evaluating net realizable value for the purposes of determining the lower of cost or market.
 
Property, Plant and Equipment and Finite-Lived Intangible Assets
 
Property, plant and equipment and finite-lived intangible assets are stated at cost. Depreciation and amortization expense are calculated by the straight-line method using the estimated useful lives of the related assets. The table below provides estimated useful lives of property, plant and equipment by asset classification (See Note 8 for estimated useful lives of finite-lived intangible assets).
 
Expected
Classification Useful Lives
Land improvements      10 - 30 years
Buildings 10- 40 years
Machinery and equipment 3- 15 years
Computer equipment 3- years
Capitalized software costs 3- 7 years

Property, plant and equipment and finite-lived intangible assets are reviewed for impairment whenever events or changes in circumstances occur that indicate that the carrying amount of an asset (or asset group) may not be recoverable. The Company's impairment review is based on an estimate of the undiscounted cash flows at the lowest level for which identifiable cash flows exist. Impairment occurs when the book value of the asset exceeds the estimated future undiscounted cash flows generated by the asset and the impairment is viewed as other than temporary. When an impairment is indicated, an impairment charge is recorded for the difference between the book value of the asset and its estimated fair market value. Depending on the asset, estimated fair market value may be determined either by use of a discounted cash flow model, or by reference to estimated selling values of assets in similar condition.
 
Impairment Review of Goodwill and Indefinite-Lived Intangible Assets
 
The Company tests its goodwill, trademarks with indefinite lives and other indefinite-lived intangible assets annually unless there are indications during a different interim period that these assets may have become impaired. With respect to goodwill, impairment occurs when the carrying amount of a reporting unit's goodwill exceeds its implied fair value. An impairment charge is recorded for the difference between the carrying amount and the implied fair value of the reporting unit's goodwill. For trademarks and other intangible assets with indefinite lives, impairment occurs when the carrying amount of an asset is greater than its estimated fair value. A charge is recorded for the difference between the carrying amount and the estimated fair value. The Company's estimates of fair value are based primarily on a discounted cash flow approach that requires significant management judgment with respect to future sales volumes, revenue and expense growth rates, changes in working capital, foreign-exchange rates, devaluation, inflation and the selection of an appropriate discount rate.
 
During the fourth quarter of fiscal year 2010, the Company changed the date of its annual impairment test of goodwill and indefinite-lived intangible assets from January 1 to April 1. The change was made to align more closely the annual impairment test with the Company's long-range planning and forecasting process. The change did not delay, accelerate, nor avoid an impairment charge. The Company has determined that this change in accounting principle is preferable under the circumstances.
 
The Company, therefore, performed its annual impairment test of goodwill and indefinite-lived intangible assets as of January 1, 2010, and again as of April 1, 2010. No instances of impairment were identified during the test.
 
Share-Based Compensation
 
The Company records compensation expense associated with stock options and other forms of equity compensation based on their fair values on the dates they are granted. The expense is recorded by amortizing the fair values on a straight-line basis over the vesting period, adjusted for estimated forfeitures.
 
Cash flows resulting from tax deductions in excess of the cumulative compensation cost recognized for the options exercised (excess tax benefit) are classified as financing cash flows. However, cash flows relating to excess tax benefits for employees directly involved in the manufacturing and/or distribution processes are classified as operating cash flows. For the fiscal years ended June 30 2010, 2009 and 2008, $10, $6, and $9, respectively, of excess tax benefits were generated from share-based payment arrangements, and were recognized as financing cash flows.
 
Employee Benefits
 
The Company has qualified and nonqualified defined benefit plans that cover substantially all domestic employees and certain international employees and provide health care benefits for domestic employees who meet age, participation and length of service requirements at retirement.
 
The Company accounts for its defined benefit and retirement health care plans using actuarial methods. These methods use an attribution approach that generally spreads "plan events" over the service lives of plan participants. Examples of plan events are plan amendments and changes in actuarial assumptions such as the expected return on plan assets, discount rate, rate of compensation increase, and certain employee-related factors, such as retirement age and mortality. The principle underlying the attribution approach is that employees render service over their service lives on a relatively "smooth" basis, and therefore the statement of earnings effects of defined benefit and retirement heath care plans are recognized in the same pattern.
 
One of the principal assumptions used in the net periodic benefit cost calculation is the expected return on plan assets. The required use of an expected return on plan assets may result in recognized pension expense or income that differs from the actual returns of those plan assets in any given year. Over time, however, the goal is for the expected long-term returns to approximate the actual returns and, therefore, the expectation is that the pattern of income and expense recognition should closely match the pattern of the services provided by the participants. The Company uses a market-related value method for calculating plan assets for purposes of determining the amortization of actuarial gains and losses. This method employs an asset smoothing approach. The differences between actual and expected returns are recognized in the net periodic benefit cost calculation over the average remaining service period of the plan participants using the corridor approach. Under this approach, only actuarial gains (losses) that exceed 5% of the greater of the projected benefit obligation or the market-related value of assets are amortized to pension expense by the Company. In developing its expected return on plan assets, the Company considers the long-term actual returns relative to the mix of investments that comprise its plan assets and also develops estimates of future investment returns by considering external sources.

The Company recognizes an actuarial-based obligation at the onset of disability for certain benefits provided to individuals after employment, but before retirement, that include medical, dental, vision, life and other benefits.
 
The Company also has various individual and group incentive compensation programs, including a performance unit program, a bonus program, and a profit sharing element of the Company 401(k) plan. The Company's contributions to the profit sharing element of the 401(k) plan and payments to managerial staff and executive management for the annual bonus program are based on achieving Company performance targets. The Company also matches employee 401(k) contributions up to one thousand dollars per year for eligible employees.
 
Environmental Costs
 
The Company is involved in certain environmental remediation and on-going compliance activities. Accruals for environmental matters are recorded on a site-by-site basis when it is probable that a liability has been incurred and the amount of the liability can be reasonably estimated. The Company's accruals reflect the anticipated participation of other potentially responsible parties in those instances where it is probable that such parties are legally responsible and financially capable of paying their respective shares of the relevant costs. These accruals are adjusted periodically as assessment and remediation efforts progress or as additional technical or legal information becomes available. Actual costs to be incurred at identified sites in future periods may vary from the estimates, given the inherent uncertainties in evaluating environmental exposures. The aggregate accrual for environmental matters is included in other liabilities in the Company's consolidated balance sheets on an undiscounted basis due to the uncertainty and timing of future payments.
 
Restructuring Liabilities
 
Liabilities for costs associated with exit or disposal activities are recognized and measured initially at estimated fair value in the period in which the liability is incurred. A liability for costs that will continue to be incurred under a contract for its remaining term without economic benefit to the Company is recognized at estimated fair value when the Company ceases using the right conveyed by the contract. The Company records employee termination liabilities once they are both probable and estimable for severance provided under the Company's existing severance policy. Employee termination liabilities outside of the Company's existing severance policy are recognized at the time the group of employees is notified, unless the group will be retained to render service beyond a minimum retention period, in which case the liability is recognized ratably over the future service period.

Revenue Recognition
 
Sales are recognized as revenue when the risk of loss and title pass to the customer and when all of the following have occurred: a firm sales arrangement exists, pricing is fixed or determinable, and collection is reasonably assured. Sales are recorded net of allowances for returns, trade-promotions, coupons and other discounts. The Company routinely commits to one-time or on-going trade-promotion programs with customers, and consumer coupon programs that require the Company to estimate and accrue the expected costs of such programs. Programs include shelf price reductions, advantageous end-of-aisle or in-store displays of the Company's products and graphics and other trade-promotion activities conducted by the customer. Coupons are recognized as a liability when distributed based upon expected consumer redemptions. The Company maintains liabilities at the end of each period for the estimated expenses incurred, but unpaid for these programs. Trade-promotion and coupon costs are recorded as a reduction of sales. The Company provides an allowance for doubtful accounts based on its historical experience and a periodic review of its accounts receivable. Receivables were presented net of an allowance for doubtful accounts of $6 at June 30, 2010 and 2009. The Company's provision for doubtful accounts was $0, $3, and $4 in fiscal years 2010, 2009, and 2008, respectively.
 
Cost of Products Sold
 
Cost of products sold represents the costs directly related to the manufacture and distribution of the Company's products and primarily includes raw materials, packaging, contract packer fees, shipping and handling, warehousing, package design, depreciation, amortization and direct and indirect labor and operating costs for the Company's manufacturing facilities including salary, benefit costs and incentive compensation.
  
Costs associated with developing and designing new packaging are expensed as incurred and include design, artwork, films, and labeling. Expenses for fiscal years ended June 30, 2010, 2009 and 2008 were $9, $8, and $9, respectively, of which $8 in each of the fiscal years was classified as cost of products sold, with the remainder classified as selling and administrative expenses.
  
Selling and Administrative Expenses
  
Selling and administrative expenses represent costs incurred by the Company in generating revenues and managing the business and include market research, commissions, and certain administrative expenses. Administrative expenses include salary, benefits, incentive compensation, professional fees and services, software and licensing fees, and other operating costs associated with the Company's non-manufacturing, non-research and development staff, facilities and equipment.
  
Advertising and Research and Development Costs
  
The Company expenses advertising and research and development costs in the period incurred.
  
Income Taxes
  
The Company uses the asset and liability method to account for income taxes. Deferred tax assets and liabilities are recognized for the anticipated future tax consequences attributable to differences between financial statement amounts and their respective tax bases. Management reviews the Company's deferred tax assets to determine whether their value can be realized based upon available evidence. A valuation allowance is established when management believes that it is more likely than not that some portion of its deferred tax assets will not be realized. Changes in valuation allowances from period to period are included in the Company's tax provision in the period of change. In addition to valuation allowances, the Company provides for uncertain tax positions when such tax positions do not meet certain recognition thresholds or measurement standards. Amounts for uncertain tax positions are adjusted in quarters when new information becomes available or when positions are effectively settled.
  
U.S. income tax expense and foreign withholding taxes are provided on unremitted foreign earnings that are not indefinitely reinvested at the time the earnings are generated. Where foreign earnings are indefinitely reinvested, no provision for U.S. income or foreign withholding taxes is made. When circumstances change and the Company determines that some or all of the undistributed earnings will be remitted in the foreseeable future, the Company accrues an expense in the current period for U.S. income taxes and foreign withholding taxes attributable to the anticipated remittance.
  
On March 23, 2010, the Patient Protection and Affordable Care Act (PPACA) was signed into law, and, on March 30, 2010, the Health Care and Education Reconciliation Act of 2010 was signed into law. The PPACA changes the tax treatment of federal subsidies received by sponsors of retiree health benefit plans that provide a benefit similar to Medicare Part D. These subsidies were previously non-taxable, but will become taxable effective in tax years beginning after December 31, 2012. The Company has concluded that the impact of the future elimination of this tax deduction on its financial statements is and will be insignificant.
  
Derivative Instruments
  
The Company's use of derivative instruments, principally swap, futures, and forward contracts, is limited to non-trading purposes and is designed to partially manage exposure to changes in interest rates, foreign currencies and commodity prices. The Company's contracts are hedges for transactions with notional balances and periods consistent with the related exposures and do not constitute investments independent of these exposures.
  
Most commodity derivative contracts and foreign-exchange contracts are designated as cash flow hedges of certain raw material and finished goods inventory purchase obligations based on certain hedge criteria. The criteria used to determine if hedge accounting treatment is appropriate are: (a) if the designation of the hedge is to an underlying exposure and (b) whether there is sufficient correlation between the value of the derivative instrument and the underlying obligation. The changes in the fair value of derivatives are recorded as either assets or liabilities in the balance sheet with an offset to net earnings or other comprehensive income, depending on whether, for accounting purposes, the derivative is designated and qualified as a hedge. From time to time, the Company may have contracts not designated as hedges for accounting purposes, for which it recognizes changes in the fair value of these contracts in other expense (income), net.
  
The Company uses different methodologies, when necessary, to estimate the fair value of its derivative contracts. The estimated fair values of the majority of the Company's contracts are based on quoted market prices, traded exchange market prices, or broker price quotations, and represent the estimated amounts that the Company would pay or receive to terminate the contracts.
BUSINESSES ACQUIRED
BUSINESSES ACQUIRED
NOTE 2. BUSINESSES ACQUIRED
  
Caltech Industries, Inc.
  
In January 2010, the Company acquired the assets of Caltech Industries, Inc., a company that provides disinfectants for the health care industry, for an aggregate price of $24, with the objective of expanding the Company's capabilities in the areas of health and wellness. The final purchase price will be subject to certain tax adjustments that are expected to be finalized during fiscal year 2011. In connection with the purchase, the Company acquired Caltech Industries' workforce. The Company paid for the acquisition in cash.
  
Net assets acquired, at fair value, included inventory of $2 and other assets of $4, goodwill of $9, trademarks of $6, customer list of $2, product formulae of $2 and other liabilities of $1. The trademarks, customer list and product formulae will be amortized over a period of 3, 15 and 10 years, respectively. Goodwill represents a substantial portion of the acquisition proceeds due to the high growth rate of the use of disinfecting products in the healthcare industry.
  
Operating results of the acquired business are included in the consolidated net earnings in the Cleaning reportable segment, from the acquisition date. Pro forma results of the Company, assuming the acquisition had occurred at the beginning of each period presented, would not be materially different from the results reported.
  
Burt's Bees Inc.
  
On November 30, 2007, the Company completed its acquisition of Burt's Bees Inc., a leading manufacturer and marketer of natural personal care products, for an aggregate price of $913, excluding $25 paid for tax benefits associated with the agreement. The Company funded the all-cash transaction through a combination of cash and short-term borrowings. During fiscal years 2009 and 2008, the Company received tax benefits associated with the acquisition of $8 and $17, respectively, through a combination of income tax refunds and reduced quarterly estimated tax payments. Under the terms of the agreement, the Company acquired 100 percent of Burt's Bees from its stockholders in a transaction that was structured as a merger. The Company also incurred $8 of transaction costs in connection with the acquisition of Burt's Bees. The operating results of Burt's Bees are reported in the Company's financial statements beginning December 1, 2007 in the Lifestyle reportable segment.
  
The following table provides unaudited pro forma results of operations of the Company for the fiscal year 2008, as if Burt's Bees had been acquired as of the beginning of that fiscal year. Results of operations for fiscal years 2010 and 2009, as reported, are included for comparison. Fiscal years 2010 and 2009, as reported, included full fiscal years of Burt's Bees results. The unaudited pro forma results include certain recurring purchase accounting adjustments such as depreciation and amortization expense on acquired tangible and intangible assets and assumed interest costs. However, unaudited pro forma results do not include certain transaction-related costs including the effect of a step-up of the value of acquired inventory, cost savings or other effects of the planned integration of Burt's Bees. Accordingly, such results of operations are not necessarily indicative of the results as if the acquisition had occurred at the beginning of the date indicated or that may result in the future.
  
2010 2009 2008
Years ended June 30         As reported         As reported         Pro forma
Net Sales $ 5,534   $ 5,450   $ 5,343
Net earnings     603   537 472
Diluted net earnings per common share $      4.24 $      3.79 $      3.32
  
 The assets and liabilities of Burt's Bees were recorded at their respective estimated fair values as of the date of the acquisition using generally accepted accounting principles then applicable to business combinations. The excess of the purchase price over the fair value of the net identifiable assets acquired has been allocated to goodwill. Goodwill represents a substantial portion of the acquisition proceeds because the Burt's Bees ® brand provides the Company with entry into the fast growing, higher margin natural personal care category.
  
The following table summarizes the estimated fair values of Burt's Bees' assets acquired and liabilities assumed and related deferred income taxes as of the acquisition date. The weighted-average estimated useful life of intangible assets subject to amortization is 16 years.
 
Assets acquired
       Cash $ 33
       Inventory 45
       Other current assets 24
       Property, plant and equipment 16
       Goodwill 613
       Intangible assets not subject to amortization - trademarks 322
       Intangible assets subject to amortization:
                 Customer list 44
                 Product formulae   8
       Other assets 1
Total assets acquired 1,106
 
Liabilities assumed
       Current liabilities - primarily accounts payable and accrued liabilities 52
       Other liabilities 3
       Current and noncurrent deferred income taxes 138
Total liabilities assumed 193
Net assets acquired $      913
 
A step-up in the value of inventory of $19 was recorded in the allocation of the purchase price based on valuation estimates. During fiscal year 2008, this step-up amount was charged to cost of products sold as the inventory was sold.
 
RESTRUCTURING AND ASSET IMPAIRMENT
RESTRUCTURING AND ASSET IMPAIRMENT
NOTE 3. RESTRUCTURING AND ASSET IMPAIRMENT
 
In fiscal year 2008, the Company began a restructuring plan that involves simplifying its supply chain and other restructuring activities (Supply Chain and Other restructuring plan), which was subsequently expanded to reduce certain staffing levels, resulting in additional costs, primarily severance, associated with this activity. The Company anticipates the Supply Chain and Other restructuring plan will be completed in fiscal year 2012. The Company may, from time to time, decide to pursue additional restructuring-related initiatives to drive cost savings and efficiencies.
 
The following table summarizes the restructuring costs, primarily severance, associated with the Company's Supply Chain and Other restructuring plan by affected reportable segment, with unallocated amounts set forth in Corporate, for fiscal years 2010, 2009 and 2008:
 
2010        2009        2008
Cleaning $ 2 $ 3 $ 3
Household 2   -   -
International -   2   2
Corporate   - 12 2
Total Company $      4 $      17 $      7
 
 
The Company incurred no asset impairment costs for the fiscal year ended June 30, 2010. Asset impairment costs for the fiscal year ended June 30, 2009 were $3 in the Household segment. Asset impairment costs for the fiscal year ended June 30, 2008 were $3, $22 and $4 in the Cleaning, Household and International segments, respectively.
 
Restructuring and asset impairment costs were $4, $20 and $36 in fiscal years 2010, 2009 and 2008, respectively.
 
The following table summarizes restructuring-related costs, primarily cost of products sold, associated with the Company's Supply Chain and Other restructuring plan by affected reportable segment, with unallocated amounts set forth in Corporate:
 
2010        2009        2008
Cleaning $ 6 $ 11 $ 9
Household   4 5   10
International - 1 3
Corporate 3     2 1
Total Company $       13 $       19 $       23
 
Total non-cash costs for fiscal years 2010, 2009 and 2008 were $4, $10 and $48, respectively.
 
The Company anticipates incurring approximately $13 to $19 of Supply Chain and Other restructuring and restructuring-related charges in fiscal year 2011, of which approximately $6 are expected to be non-cash. The Company anticipates approximately $2 to $4 of restructuring-related charges in selling and administrative expenses in Corporate and $4 to $6 of cost of products sold charges to be in the Cleaning segment and $7 to $9 in the Household segment, respectively. The total anticipated charges related to the Supply Chain and Other restructuring plan for fiscal year 2012 are estimated to be approximately $5 to $7.
 
The following table reconciles the accrual for the Supply Chain and Other restructuring charges discussed above:
 
Asset Accumulated
Severance         Impairments         Depreciation         Other         Total
Accrual Balance as of June 30, 2007 $ - $ - $ - $ - $ -  
2008 Charges 7 29 20 3 59
Cash payments (2 ) - - (3 ) (5 )
Charges against assets - (29 ) (20 ) - (49 )
Accrual Balance as of June 30, 2008 5 - - - 5
2009 Charges 17 3 8 11 39
Cash payments (7 ) - - (11 ) (18 )
Charges against assets - (3 )   (8 ) - (11 )
Accrual Balance as of June 30, 2009 15       - - -   15
2010 Charges 7 -   4     9   20
Cash payments   (16 ) - -   (9 ) (25 )
Adjustments (3 ) -   - - (3 )
Charges against assets - - (4 ) - (4 )
Accrual Balance as of June 30, 2010 $      3 $      - $      - $      - $      3
 
INVENTORIES, NET
INVENTORIES, NET

NOTE 4. INVENTORIES, NET
 
Inventories, net at June 30 were comprised of the following:
 
2010        2009
Finished Goods $ 300 $ 304
Raw materials and packaging   102 99
Work in process 4 4  
LIFO allowances (28 )     (31 )
Allowances for obsolescence (11 ) (10 )
Total $       367 $       366
 
The last-in, first-out (LIFO) method was used to value approximately 36% and 38% of inventories at June 30, 2010 and 2009, respectively. The carrying values for all other inventories, including inventories of all international businesses, are determined on the first-in, first-out (FIFO) method. The effect on earnings of the liquidation of LIFO layers was a favorable $3 for the fiscal year ended June 30, 2010 and less than $1 for the fiscal years ended June 30, 2009 and 2008.
 
During the fiscal years ended 2010, 2009 and 2008, the Company's inventory obsolescence provision was $11, $12 and $12, respectively.
OTHER CURRENT ASSETS
OTHER CURRENT ASSETS
NOTE 5. OTHER CURRENT ASSETS
 
Other current assets at June 30 were comprised of the following:
 
         2010        2009
Deferred tax assets   $ 73 $ 74
Prepaid expenses   40   42
Other   13     6
Total $      126 $      122
 
PROPERTY, PLANT AND EQUIPMENT, NET
PROPERTY, PLANT AND EQUIPMENT, NET
NOTE 6. PROPERTY, PLANT AND EQUIPMENT, NET
 
The components of property, plant and equipment, net, at June 30 were as follows:
 
         2010        2009
Machinery and equipment $ 1,515   $ 1,431  
Buildings   582     568  
Capitalized software costs   302     289  
Construction in progress   166     146  
Land and improvements   127     127  
Computer equipment   92     93  
    2,784     2,654  
Less: Accumulated depreciation and amortization   (1,805 )   (1,699 )
Total $      979   $      955  
                 
Depreciation and amortization expense related to property, plant and equipment was $165, $173 and $186 in fiscal years 2010, 2009 and 2008, respectively.
GOODWILL, TRADEMARKS AND OTHER INTANGIBLE ASSETS
GOODWILL, TRADEMARKS AND OTHER INTANGIBLE ASSETS

NOTE 7. GOODWILL, TRADEMARKS AND OTHER INTANGIBLE ASSETS
 
Changes in the carrying amount of Goodwill, Trademarks and Other intangible assets for the fiscal years ended June 30, 2010 and 2009, were as follows:
 
Goodwill
       Cleaning        Lifestyle        Household        International        Total
Balance June 30, 2008 $ 555 $ 622 $ 85 $ 396 $ 1,658
Translation adjustments and other   - 1 -   (29 ) (28 )
Balance June 30, 2009 555 623   85 367 1,630  
Acquisitions   9   - - -   9
Translation adjustments and other -   -   -   11     11
Balance June 30, 2010 $       564 $       623 $       85 $       378 $       1,650
 
Other intangible assets
Trademarks subject to amortization
Technology
Subject to Not subject to and Product
        amortization          amortization         Total         formulae         Other         Total
Balance June 30, 2008 $ 1 $ 559 $ 560 $ 63 $ 60 $ 123
Amortization (1 ) - (1 ) (10 ) (5 ) (15 )
Transfers 14 (14 ) - - - -
Translation adjustments and other   - (2 ) (2 ) - (3 ) (3 )
Balance June 30, 2009 14     543 557   53 52 105
Acquisitions   6 - 6   - 4 4
Amortization (2 ) -   (2 )   (9 )   (5 ) (14 )
Transfers 5   (5 )   - (7 ) 7     -
Translation adjustments and other 1 - 1 - 1 1
Balance June 30, 2010 $       24 $       538 $       562 $       37 $       59 $       96
 
Trademarks and Other intangible assets subject to amortization are net of accumulated amortization of $235 and $219 at June 30, 2010 and 2009, respectively. Estimated amortization expense for these intangible assets is $16, $15, $14, $13 and $10 for fiscal year 2011, 2012, 2013, 2014 and 2015. The weighted-average amortization period for trademarks and other intangible assets subject to amortization is 20 years and 14 years, respectively.
 
During the fourth quarter of fiscal year 2010, the Company changed the date of its annual impairment test of goodwill and indefinite-lived intangible assets from January 1 to April 1. The change was made to align more closely the annual impairment test date with the Company's long-range planning and forecasting process. The change did not delay, accelerate nor avoid an impairment charge. The Company, therefore, performed its annual impairment test of goodwill and indefinite-lived intangible assets as of January 1, 2010, and again as of April 1, 2010, and no instances of impairment were identified.
 
OTHER ASSETS
OTHER ASSETS
NOTE 8. OTHER ASSETS
 
Other assets were comprised of the following at June 30:
  
       2010        2009
Equity investments $ 49   $ 45
Investment in insurance contracts 35 35
Deferred tax assets 25 28
Investment in low-income housing partnerships   11 13
Deferred financing costs 10 10
Other 14 18
Total $      144 $      149
 
Equity Investments
    
The Company holds various equity investments in a number of consumer products businesses, most of which operate outside the United States. The Company has no ongoing capital commitments, loan requirements, guarantees or any other types of arrangements under the terms of its agreements that would require any future cash contributions or disbursements arising out of an equity investment, except for the investment in low-income housing partnerships described in the following paragraph.
    
Investment in Low-Income Housing Partnerships
         
The Company owns, directly or indirectly, limited partnership interests of up to 99% in 42 low-income housing partnerships, which are accounted for on the equity basis. The purpose of the partnerships is to develop and operate low-income housing rental properties. The general partners, who typically hold 1% of the partnership interests, are third parties unrelated to the Company and its affiliates, and are responsible for controlling and managing the business and financial operations of the partnerships. The partnerships provide the Company with low-income housing tax credits. Tax benefits (detriments), net of equity in the losses of the low-income housing partnerships, were $2, $1, and $(3) in fiscal years 2010, 2009 and 2008, respectively. The Company's estimated future capital requirement for the partnerships is less than $1 in fiscal year 2011 and thereafter. As a limited partner, the Company is not responsible for any of the liabilities and obligations of the partnerships nor do the partnerships or their creditors have any recourse to the Company other than for the capital requirements. Recovery of the Company's investments in the partnerships is accomplished through the utilization of low-income housing tax credits, the tax benefits of partnership losses and proceeds from the disposition of the properties. The risk of the low-income housing tax credits being unavailable to the Company is considered very low. For the combined group of low-income housing partnerships in which the Company invests, the aggregate underlying assets and liabilities were approximately $292 and $417, respectively, at June 30, 2010. The Company does not consolidate the investment in low-income housing partnerships.
  
Investment in Insurance Contracts
  
The Company invests in life insurance policies and records the cash surrender value of the contracts, net of any policy loans, at fair value. Any change in the cash surrender value is reflected in other expense (income), net.
ACCRUED LIABILITIES
ACCRUED LIABILITIES
 
NOTE 9. ACCRUED LIABILITIES
 
Accrued liabilities at June 30 consisted of the following:
 
       2010        2009
Compensation and employee benefit costs $ 149 $ 123
Trade and sales promotion 109   86
Dividends   78   70
Interest   40 49
Other 116 144
Total $      492 $      472
 
DEBT
DEBT
NOTE 10. DEBT
   
In fiscal year 2010, $598 of debt became due and was paid. The Company funded the debt repayment with commercial paper and operating cash flows.
  
In November 2009, the Company issued $300 of long-term debt in senior notes. The notes carry an annual fixed interest rate of 3.55% payable semi-annually in May and November. The notes mature on November 1, 2015. Proceeds from the notes were used to repay commercial paper. The notes rank equally with all of the Company's existing and future senior indebtedness.
    
Notes and loans payable, which mature in less than one year, included the following at June 30:
  
        2010         2009
Commercial paper   $ 369   $ 419
Foreign borrowings 2 2
Total $      371 $      421
 
The weighted average interest rate on commercial paper was 0.43% and 0.59% at June 30, 2010 and 2009, respectively. During the fiscal years ended June 30, 2010, 2009 and 2008, the weighted average interest rates on notes and loans payable was 0.62%, 2.85% and 4.45%, respectively. The carrying value of notes and loans payable at June 30, 2010 and 2009, approximated the fair value of such debt.
 
Long-term debt at June 30 included the following:
  
        2010         2009
Senior unsecured notes and debentures:
       4.20%, $575 due January 2010 $ - $ 575
       6.125%, $300 due February 2011 300 305
       5.45%, $350 due October 2012 349 349
       5.00%, $500 due March 2013 500 499
       5.00%, $575 due January 2015 575 575  
       3.55%, $300 due November 2015 299 -
       5.95%, $400 due October 2017   398 398
Foreign borrowings   3 27
Total 2,424   2,728
Less: Current maturities (300 ) (577 )
Long-term debt $      2,124   $      2,151
 
The weighted average interest rate on long-term debt was 5.19% and 5.14% at June 30, 2010 and 2009, respectively. During the fiscal years ended June 30, 2010, 2009 and 2008, the weighted average interest rates on long-term debt, including the effect of interest rate swaps, was 5.16%, 5.15% and 5.16%, respectively. The estimated fair value of long-term debt, including current maturities, was $2,635 and $2,816 at June 30, 2010 and 2009, respectively. The Company accounts for its long-term debt at face value, net of any unamortized discounts or premiums. The fair value of long-term debt was determined using secondary market prices quoted by corporate bond dealers.
 
Credit facilities at June 30 were as follows:
  
        2010         2009
Revolving credit line   $ 1,100   $ 1,100
Foreign credit lines   23 57
Other credit lines 12 3
Total $      1,135 $      1,160
 
  
At June 30, 2009, there were no borrowings under the $1,100 revolving credit agreement, and the Company believes that borrowings under the revolving credit facility are now available and will continue to be available for general corporate purposes and to support commercial paper issuances. The $1,100 revolving credit agreement expires in April 2013 and includes certain restrictive covenants.
  
The Company was in compliance with all restrictive covenants and limitations as of June 30, 2010 and 2009. In addition, the Company had $35 of foreign and other credit lines at June 30, 2010, of which $27 was available for borrowing.
  
Long-term debt maturities at June 30, 2010, are $300, $3, $850, Zero, $575 and $700 in fiscal years 2011, 2012, 2013, 2014, 2015 and thereafter, respectively.
FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS
FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS
NOTE 11. FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS
  
The Company is exposed to certain commodity and foreign currency risks relating to its ongoing business operations. The Company uses commodity futures and swap contracts to fix the price of a portion of its forecasted raw material requirements. Contract maturities, which are generally no longer than 18 months, are matched to the length of the raw material purchase contracts. The Company also enters into certain foreign currency related derivative contracts to manage a portion of the Company's foreign exchange risk associated with the purchase of inventory. These foreign currency contracts generally have durations no longer than twelve months.
  
The accounting for changes in the fair value (i.e., gains or losses) of a derivative instrument depends on whether it has been designated and qualifies as a hedge, and on the type of the hedging relationship. For those derivative instruments designated and qualifying as hedging instruments, the Company must designate the hedging instrument as a fair value hedge or a cash flow hedge. The Company designates its commodity forward and future contracts of forecasted purchases for raw materials and its foreign currency forward contracts of forecasted purchases of inventory as cash flow hedges. During the fiscal year ended June 30, 2010, the Company had no hedging instruments designated as fair value hedges.
  
For derivative instruments designated and qualifying as a cash flow hedge, the effective portion of the gain or loss on the derivative is reported as a component of other comprehensive income (OCI) and reclassified into earnings in the same period or periods during which the hedged transaction affects earnings. The estimated amount of the existing net loss at the reporting date expected to be reclassified into earnings within the next twelve months is $0. Gains and losses on the derivative instruments representing either hedge ineffectiveness or hedge components excluded from the assessment of effectiveness are recognized in current earnings. During the fiscal year 2010, the hedge ineffectiveness was not material. The Company dedesignates these cash flow hedge relationships whenever it determines that the hedge relationships are no longer highly effective. The portion of gains or losses on the derivative instrument previously accumulated in other comprehensive income for dedesignated hedges remains in accumulated other comprehensive income until the forecasted transaction is recognized in earnings. Changes in the value of derivative instruments after dedesignation are recorded in other income (expense) and amounted to ($3) for the fiscal year 2010.
  
The Company's derivative financial instruments designated as hedging instruments are recorded at fair value in the condensed consolidated balance sheet as follows:
  
Fair value
       Balance Sheet location        6/30/2010        6/30/2009
Assets
Foreign exchange contracts   Other current assets $ 1 $ -
Commodity purchase contracts Other current assets   -   6
$ 1   $ 6  
 
Liabilities
Commodity purchase contracts Accrued liabilities $      (2 ) $      (21 )
 
The effects of derivative instruments designated as hedging instruments on OCI and on the statement of earnings for the fiscal year 2010 were as follows:
 
        Loss reclassified from
Loss recognized in OCI and recognized
Cash flow hedges       OCI       in earnings
Commodity purchase contracts   $                     (3 ) $                        (15 )
Foreign exchange contracts (2 ) (3 )
Total $ (5 ) $ (18 )
 
The gains (losses) reclassified from OCI and recognized in earnings are included in cost of products sold.
 
The Company's derivative financial instruments not designated as hedging instruments are recorded at fair value in the condensed consolidated balance sheet as follows:
 
      Fair value
Balance Sheet location       6/30/2010       6/30/2009
Liabilities  
Commodity purchase contracts Accrued liabilities   $      (1 ) $           -
 
  
As of June 30, 2010, the net notional value of commodity derivatives was $91, of which $46 related to diesel fuel, $18 related to jet fuel, $25 related to soybean oil and $2 related to crude oil.
 
As of June 30, 2010, the Company had outstanding foreign currency forward contracts related to its subsidiaries in Canada and Australia of $12 and $6, respectively, used to hedge forecasted purchases of inventory.
 
Certain terms of the agreements governing the Company's over-the-counter derivative instruments require the Company or the counterparty to post collateral when the fair value of the derivative instruments exceeds contractually defined counterparty liability position limits. There was no collateral posted at June 30, 2010.
 
Certain terms of the agreements governing the over-the-counter derivative instruments contain provisions that require the credit ratings, as assigned by Standard and Poor's and Moody's to the Company and its counterparties, to remain at a level equal to or better than the minimum of an investment grade credit rating. As of June 30, 2010, the Company and each of its counterparties maintained investment grade ratings with both Standard and Poor's and Moody's.
 
U.S. GAAP prioritizes the inputs used in measuring fair value into the following hierarchy:
 
Level 1: Quoted market prices in active markets for identical assets or liabilities.
Level 2: Observable market-based inputs or unobservable inputs that are corroborated by market data.
Level 3: Unobservable inputs reflecting the reporting entity's own assumptions.
 
At June 30, 2010, the Company's financial assets and liabilities that were measured at fair value on a recurring basis during the year were level 2 foreign exchange contracts with a fair value of $1(included in other current assets), and commodity purchase contracts with a fair value of $3 (included in accrued liabilities).
 
Commodity purchase contracts are fair valued using market quotations obtained from commodity derivative dealers.
 
The foreign exchange contracts are fair valued using information quoted by foreign exchange dealers.
 
The carrying values of cash and cash equivalents, accounts receivable, accounts payable and notes and loans payable approximate their fair values at June 30, 2010 and 2009, due to the short maturity and nature of those balances.
OTHER LIABILITIES
OTHER LIABILITIES
NOTE 12. OTHER LIABILITIES
 
Other liabilities consisted of the following at June 30:
2010       2009
Employee benefit obligations $      306 $      266
Venture agreement net terminal obligation 274 269
Taxes 64   65
Other   33 40
Total $ 677 $ 640
 
 
Venture Agreement
 
In January 2003, the Company entered into an agreement with The Procter & Gamble Company (P&G) by which a venture was formed related to the Company's Glad® plastic bags, wraps and containers business. The Company maintains a net terminal obligation liability, which reflects the estimated value of the contractual requirement to repurchase P&G's interest at the termination of the agreement. As of June 30, 2010 and 2009, P&G had a 20% interest in the venture. The Company pays a royalty to P&G for its interest in the profits, losses and cash flows, as contractually defined, of the Glad® business and are included in cost of products sold.
 
The agreement has a 20-year term, with a 10-year renewal option and can be terminated under certain circumstances, including at P&G's option upon a change in control of the Company, or, at either party's option, upon the sale of the Glad® business by the Company. Upon termination of the agreement, the Company will purchase P&G's interest for cash at fair value as established by predetermined valuation procedures. Following termination, the Glad® business will retain the exclusive core intellectual property licenses contributed by P&G on a royalty free basis for the licensed products marketed.
OTHER CONTINGENCIES
OTHER CONTINGENCIES
NOTE 13. OTHER CONTINGENCIES
 
The Company is involved in certain environmental matters, including Superfund and other response actions at various locations. The Company recorded a liability of $16 and $19 at June 30, 2010 and 2009, respectively, for its share of the related aggregate future remediation cost. One matter in Dickinson County, Michigan, for which the Company is jointly and severally liable, accounts for a substantial majority of the recorded liability at both June 30, 2010 and 2009. The Company is subject to a cost-sharing arrangement with Ford Motor Co. (Ford) for this matter, under which the Company has agreed to be liable for 24.3% of the aggregate remediation and associated costs, other than legal fees, as the Company and Ford are each responsible for their own such fees. In October 2004, the Company and Ford agreed to a consent judgment with the Michigan Department of Environmental Quality, which sets forth certain remediation goals and monitoring activities. Based on the current status of this matter, and with the assistance of environmental consultants, the Company maintains an undiscounted liability representing its best estimate of its share of costs associated with the capital expenditures, maintenance and other costs to be incurred over an estimated 30-year remediation period. The most significant components of the liability relate to the estimated costs associated with the remediation of groundwater contamination and excess levels of subterranean methane deposits. The Company made payments of less than $1 in fiscal years 2010 and 2009, respectively, towards remediation efforts. Currently, the Company cannot accurately predict the timing of the payments that will likely be made under this estimated obligation. In addition, the Company's estimated loss exposure is sensitive to a variety of uncertain factors, including the efficacy of remediation efforts, changes in remediation requirements and the timing, varying costs and alternative clean-up technologies that may become available in the future. Although it is possible that the Company's exposure may exceed the amount recorded, any amount of such additional exposures, or range of exposures, is not estimable at this time.
 
The Company is subject to various other lawsuits and claims relating to issues such as contract disputes, product liability, patents and trademarks, advertising, employee and other matters. Although the results of claims and litigation cannot be predicted with certainty, it is the opinion of management that the ultimate disposition of these matters, to the extent not previously provided for, will not have a material adverse effect, individually or in the aggregate, on the Company's consolidated financial statements taken as a whole.
STOCKHOLDERS' EQUITY (DEFICIT)
STOCKHOLDERS' EQUITY (DEFICIT)
NOTE 14. STOCKHOLDERS' EQUITY (DEFICIT)
 
The Company has two share repurchase programs: an open-market program, which had a total authorization of $750 as of June 30, 2010, and a program to offset the impact of share dilution related to share-based awards (Evergreen Program), which has no authorization limit. The current open-market program was approved by the Company's Board of Directors in May 2008.
 
Share repurchases under the Evergreen Program were $150 (2.4 million shares) in fiscal year 2010. No shares were repurchased under the open-market program or Evergreen Program in fiscal year 2009. Share repurchases under the Evergreen Program were $118 (2.1 million shares) in fiscal year 2008. In August 2007, the Company entered into an Accelerated Share Repurchase (ASR) agreement with two investment banks in which the Company received 10.9 million shares in August 2007 and 1.1 million shares in January 2008. The average per share amount paid for all shares purchased under the ASR agreement was $62.08 for an aggregate price of $750.
 
During fiscal years 2010, 2009 and 2008, the Company declared dividends per share of $2.05, $1.88 and $1.66, respectively. During fiscal years 2010, 2009, and 2008, the Company paid dividends per share of $2.00, $1.84 and $1.60, respectively.
 
Accumulated other comprehensive net losses at June 30, 2010, 2009 and 2008, included the following net-of-tax (losses) gains:
 
      2010       2009       2008
Currency translation $ (211 ) $ (220 ) $ (142 )
Derivatives 1 (9 ) 30
Pension and postretirement benefit adjustments (161 ) (118 ) (67 )
Total $     (371 ) $     (347 ) $     (179 )
 
EARNINGS PER SHARE
EARNINGS PER SHARE
NOTE 15. EARNINGS PER SHARE
 
The Company computes EPS using the two-class method (See Note 1), which is an earnings allocation formula that determines EPS for common stock and participating securities.
 
EPS for common stock is computed by dividing net earnings applicable to common stock by the weighted average number of common shares outstanding each period on an unrounded basis. Net earnings applicable to common stock includes dividends paid to common shareholders during the period plus a proportionate share of undistributed net earnings which is based on the weighted average number of shares of common stock and participating securities outstanding during the period.
 
Diluted EPS for common stock reflects the earnings dilution that could occur from common shares that may be issued through stock options, restricted stock awards, performance units and restricted stock units that are not participating securities. Excluded from this calculation are amounts allocated to participating securities.
 
The following are reconciliations of net earnings to net earnings applicable to common stock, and the number of common shares outstanding (in thousands) used to calculate basic EPS to those used to calculate diluted EPS for fiscal years ended June 30:
 
      2010       2009       2008
Net earnings $      603 $      537 $      461
Less: Earnings allocated to participating securities 3 5 5
Net earnings applicable to common stock $ 600 $ 532 $ 456
     
Weighted Average Number of Shares Outstanding
      2010       2009       2008
Basic   140,272   139,015   139,633
Dilutive effect of stock options and other (excludes participating securities)   1,262   1,154   1,564
Diluted   141,534   140,169   141,197
       
The Company did not include the following options to purchase shares of the Company's common stock in the calculations of diluted EPS because their inclusion would be anti-dilutive for the fiscal years ended June 30:
 
       2010       2009       2008
Stock options        3,978        5,090        2,719
SHARE-BASED COMPENSATION PLANS
SHARE-BASED COMPENSATION PLANS
NOTE 16. SHARE-BASED COMPENSATION PLANS
 
In November 2005, the Company's stockholders approved the 2005 Stock Incentive Plan (2005 Plan). The 2005 Plan permits the Company to grant various nonqualified, share-based compensation awards, including stock options, restricted stock, performance units, deferred stock units, restricted stock units, stock appreciation rights, and other stock-based awards. The Company is authorized to grant up to seven million common shares under the 2005 Plan, and, at June 30, 2010, approximately six million common shares were available for grant under the plan.

Compensation cost and related income tax benefit recognized in the Company's fiscal years 2010, 2009 and 2008 consolidated financial statements for share-based compensation plans were classified as indicated in the table below.
 
      2010       2009       2008
Cost of products sold $       8 $       8 $       7
Selling and administrative expenses 46 45 36
Research and development costs 6 5 4
Total compensation cost $ 60 $ 58 $ 47
Related income tax benefit $ 22 $ 22 $ 18
 
Cash received during fiscal year 2010, 2009 and 2008 from stock options exercised under all share-based payment arrangements was $69, $35 and $31, respectively. The Company issues shares for share-based compensation plans from treasury stock. The Company may repurchase shares under its Evergreen Program to offset the estimated impact of share dilution related to share-based awards (See Note 14).
 
Details regarding the valuation and accounting for stock options, restricted stock awards, performance units and deferred stock units for non-employee directors follow.
 
Stock Options
 
The fair value of each stock option award granted during fiscal years 2010, 2009 and 2008 was estimated on the date of grant using the Black-Scholes valuation model and assumptions noted in the following table:
 
      2010       2009       2008
Expected life 5years 5years 5years
Expected volatility 21.6% to 22.9% 23.4%   21.0% to 22.2%
Weighted-average volatility   22.0%   23.4%   21.6%
Risk-free interest rate 2.2% to 2.4% 2.6%   2.8% to 4.2%
Dividend yield 3.4% to 3.6%   3.0%   2.7% to 3.0%
Weighted-average dividend yield 3.6%   3.0%   2.7%
 
The expected life of the stock options is based on observed historical exercise patterns. Groups of employees having similar historical exercise behavior are considered separately for valuation purposes. The Company estimates stock option forfeitures based on historical data for each separate employee grouping, and adjusts the rate to expected forfeitures periodically. The adjustment of the forfeiture rate will result in a cumulative catch-up adjustment in the period the forfeiture estimate is changed. The expected volatility is based on implied volatility from publicly traded options on the Company's stock at the date of grant, historical implied volatility of the Company's publicly traded options and other factors. The risk-free interest rate is based on the implied yield on a U.S. Treasury zero-coupon issue with a remaining term equal to the expected term of the option. The dividend yield is based on the projected annual dividend payment per share, divided by the stock price at the date of grant.
 
Details of the Company's stock option plan at June 30 are summarized below:
 
Weighted- Average
Average Remaining Aggregate
Number of Exercise Contractual Intrinsic
Shares Price per Share Life Value
        (In thousands)                        
Outstanding at June 30, 2009            10,089 $       53 6 years $       32
Granted 1,924   57
Exercised (1,701 ) 41      
Cancelled (301 )   60  
Outstanding at June 30, 2010 10,011 55 6years 68
 
Options vested and exercisable at June 30, 2010 6,087 52 4years 61

The weighted-average fair value per share of each option granted during fiscal years 2010, 2009, and 2008, estimated at the grant date using the Black-Scholes option pricing model, was $8.34, $11.07 and $11.86, respectively. The total intrinsic value of options exercised in fiscal years 2010, 2009 and 2008 was $36, $16 and $16, respectively.
Stock option awards outstanding as of June 30, 2010, have been granted at prices that are either equal to or above the market value of the stock on the date of grant. Stock options outstanding as of June 30, 2010, generally vest over four years and expire no later than ten years after the grant date. The Company generally recognizes compensation expense ratably over the vesting period. At June 30, 2010, there was $19 of total unrecognized compensation cost related to nonvested options, which is expected to be recognized over a remaining weighted-average vesting period of two years, subject to forfeitures.
 
Restricted Stock Awards
 
The fair value of restricted stock awards is estimated on the date of grant based on the market price of the stock and is amortized to compensation expense on a straight-line basis over the related vesting periods, which are generally three to four years. The total number of restricted stock awards expected to vest is adjusted by estimated forfeiture rates. Restricted stock grants prior to July 1, 2009, receive dividend distributions during their vesting period. Restricted stock grants after July 1, 2009, receive dividends earned during the vesting period upon vesting.
 
At June 30, 2010, there was $2 of total unrecognized compensation cost related to nonvested restricted stock awards, which is expected to be recognized over a remaining weighted-average vesting period of two years. The total fair value of the shares that vested in fiscal years 2010, 2009 and 2008 was $5, $8 and $10, respectively. The weighted-average grant-date fair value of awards granted was $58.91, $63.30 and $60.69 per share for fiscal years 2010, 2009 and 2008, respectively.
 
A summary of the status of the Company's restricted stock awards at June 30 is presented below:
 
Weighted-Average
Grant Date
Number of Fair Value
        Shares         per Share
(In thousands)
Restricted stock awards at June 30, 2009                 196 $      62
Granted 5 59
Vested (83 ) 61
Forfeited (6 ) 62
Restricted stock awards at June 30, 2010 112 62
 
Performance Units
 
The Company's performance unit grants provide for the issuance of common stock to certain managerial staff and executive management if the Company achieves certain performance targets. The performance unit grants vest after three years. Performance unit grants prior to July 1, 2009, receive dividend distributions during their vesting periods. Performance unit grants after July 1, 2009, receive dividends earned during the vesting period upon vesting. The fair value of each grant issued is estimated on the date of grant based on the current market price of the stock. The total amount of compensation expense recognized reflects estimated forfeiture rates, and the initial assumption that performance goals will be achieved. Compensation expense is adjusted as necessary on a quarterly basis based on management's assessment of the probability that performance goals will be achieved. If such goals are not met or it is determined that achievement of performance goals is not probable, any previously recognized compensation expense is reversed to reflect the expected payout level. If it is determined that the performance goals will be exceeded, additional compensation expense is recognized.
 
The number of shares issued will be dependent upon vesting and the achievement of specified performance targets. At June 30, 2010, there was $31 in unrecognized compensation cost related to nonvested performance unit grants that is expected to be recognized over a remaining weighted-average performance period of two years. The weighted-average grant-date fair value of awards granted was $57.28, $63.95 and $61.16 per share for fiscal years 2010, 2009 and 2008, respectively.
 
A summary of the status of the Company's performance unit awards at June 30 is presented below:
 
Weighted-Average
Grant Date
Number of Fair Value
Shares per Share
        (In thousands)        
Performance unit awards at June 30, 2009                 1,449 $ 60
Granted 670 58
Vested and distributed (485 ) 61
Forfeited (83 ) 61
Performance unit awards at June 30, 2010 1,551 59
Perfomance units vested and deferred at June 30, 2010 252 53
 
The nonvested performance units outstanding at June 30, 2010 and 2009, were 1,298,382 and 1,252,134, respectively, and the weighted average grant date fair value was $60.68 and $62.28 per share, respectively. Total shares vested during fiscal year 2010 were 533,581, which had a weighted average grant date fair value per share of $61.51. The total fair value of shares vested was $33, $26 and $4 during fiscal years 2010, 2009 and 2008, respectively. Upon vesting, the recipients of the grants receive the distribution as shares or, if previously elected by those who have the option to, as deferred stock. During fiscal years 2010 and 2009, $29 and $22, respectively, of the vested awards were paid by the issuance of shares. During both fiscal years 2010 and 2009, $4 of the vested awards were deferred. Deferred shares receive dividend distributions during their deferral period.
 
Deferred Stock Units for Nonemployee Directors
 
Nonemployee directors receive annual grants of deferred stock units under the Company's director compensation program and can elect to receive all or a portion of their annual retainers and fees in the form of deferred stock units. The deferred stock units receive dividend distributions, which are reinvested as deferred stock units, and are recognized at their fair value on the date of grant. Each deferred stock unit represents the right to receive one share of the Company's common stock following the termination of a director's service.
 
During fiscal year 2010, the Company granted 23,528 deferred stock units, reinvested dividends of 5,290 units and distributed 1,990 shares, which had a weighted-average fair value on grant date of $61.11, $61.89 and $52.06 per share, respectively. As of June 30, 2010, 179,826 units were outstanding, which had a weighted-average fair value on grant date of $56.66 per share.
LEASES AND OTHER COMMITMENTS
LEASES AND OTHER COMMITMENTS
NOTE 17. LEASES AND OTHER COMMITMENTS
 
The Company leases transportation equipment, certain information technology equipment and various manufacturing, warehousing, and office facilities. The Company's leases are classified as operating leases and the Company's existing contracts will expire by 2020. The Company expects that in the normal course of business, existing contracts will be renewed or replaced by other leases. The following is a schedule of future minimum rental payments required under the Company's existing non-cancelable lease agreements at June 30, 2010:
 
       Future Minimum
Fiscal Year   Rental Payments
2011 $       32
2012   35
2013 31
2014 26
2015 21
Thereafter 81
Total $ 226
 
Rental expense for all operating leases was $59, $62, and $59 in fiscal years 2010, 2009 and 2008, respectively. Space not occupied by the Company in its headquarters building is rented to other tenants under operating leases expiring through 2015. Future minimum rentals to be received under these leases total $5 and do not exceed $2 in any one year.
 
The Company is also party to certain purchase obligations, which are defined as purchase agreements that are enforceable and legally-binding and that specify all significant terms, including quantity, price and the approximate timing of the transaction. Examples of the Company's purchase obligations include contracts to purchase raw materials, commitments to contract manufacturers, commitments for information technology and related services, advertising contracts, utility agreements, capital expenditure agreements, software acquisition and license commitments, and service contracts. At June 30, 2010, the Company's purchase obligations, including the services related to the Information Technology Services (ITS) Agreement, totaled $361, $145, $58, $19, $3, and $2 for fiscal years 2011 through 2015, and thereafter, respectively. Estimates for the ITS Agreement are based on an annual service fee that is adjusted periodically based upon updates to services and equipment provided. Included in the ITS Agreement are certain acceleration payment clauses if the Company terminates the contract without cause.
OTHER EXPENSE (INCOME), NET
OTHER EXPENSES (INCOME), NET
NOTE 18. OTHER EXPENSE (INCOME), NET
 
The major components of other expense (income), net for the fiscal years ended June 30 were:
 
      2010       2009       2008
Foreign exchange transaction losses, net $        26 $        28 $        2
Amortization of trademarks and other intangible assets 9 7 7
Low-income housing partnership losses (Note 8) 1 3 7
Equity in earnings of unconsolidated affiliates (9 ) (8 ) (8 )
Interest income (3 ) (4 ) (12 )
Other 1 - (5 )
Total other expense (income), net $ 25 $ 26 $ (9 )
 
 
Approximately 90% of the fiscal year 2010 foreign exchange transaction losses, net, were related to the remeasurement losses by the Company's Venezuelan subsidiary (See Note 1).
 
Approximately 70% of the fiscal year 2009 foreign exchange transaction losses, net, were related to transactions to covert local currency to U.S. dollars by the Company's Venezuelan subsidiary.
INCOME TAXES
INCOME TAXES
NOTE 19. INCOME TAXES
 
The provision for income taxes on continuing operations, by tax jurisdiction, consisted of the following for the fiscal years ended June 30:
 
      2010       2009       2008
Current
       Federal
 $       227 $       194 $       203
       State 29 40 28
       Foreign 42 41 52
Total current   298 275 283
Deferred
       Federal 18 2 (36 )
       State 2   3 (3 )
       Foreign 4   (6 ) (12 )
Total deferred   24 (1 ) (51 )
Total $ 322 $ 274   $ 232
 
The components of earnings from continuing operations before income taxes, by tax jurisdiction, were as follows for the fiscal years ended June 30:
 
      2010       2009       2008
United States   $       773 $       669 $       538
Foreign   152   142 155
Total $ 925 $ 811   $ 693
 
 
A reconciliation of the statutory federal income tax rate to the Company's effective tax rate on continuing operations follows for the fiscal years ended June 30:
 
      2010       2009       2008
Statutory federal tax rate      35.0 %      35.0 %      35.0 %
State taxes (net of federal tax benefits) 2.2 3.4 2.5
Tax differential on foreign earnings (1.0 ) (1.8 )   0.1
Net adjustment of prior year federal and state tax accruals (0.4 ) (2.0 ) 1.0
Change in valuation allowance 0.6   0.1   (2.3 )
Domestic manufacturing deduction (1.7 ) (1.8 ) (1.7 )
Other differences   0.1   0.9   (1.0 )
Effective tax rate 34.8 %   33.8 % 33.6 %
 
Applicable U.S. income taxes and foreign withholding taxes have not been provided on approximately $102 of undistributed earnings of certain foreign subsidiaries at June 30, 2010, because these earnings are considered indefinitely reinvested. The net federal income tax liability that would arise if these earnings were not indefinitely reinvested is approximately $26. Applicable U.S. income and foreign withholding taxes are provided on these earnings in the periods in which they are no longer considered indefinitely reinvested.
 
With respect to the Company's stock option plans, realized tax benefits in excess of tax benefits recognized in net earnings are recorded as increases to additional paid-in capital. Excess tax benefits of approximately $10, $6, and $9, were realized and recorded to additional paid-in capital for the fiscal years 2010, 2009 and 2008, respectively.
 
The components of deferred tax assets at June 30 are shown below:
 
      2010       2009
Deferred tax assets
       Compensation and benefit programs
 $      201 $      177
       Basis difference related to Venture Agreement 30 30
       Accruals and reserves 25 30
       Inventory costs 13 16
       Other 63 60
              Subtotal 332 313
       Valuation allowance (12 ) (6 )
       Total deferred tax assets 320 307
 
Deferred tax liabilities
       Fixed and intangible assets (188 ) (176 )
       Low-income housing partnerships (28 ) (27 )
       Other (30 ) (25 )
       Total deferred tax liabilities (246 ) (228 )
       Net deferred tax assets $ 74 $ 79
 
The net deferred tax assets included in the consolidated balance sheet at June 30 were as follows:
 
      2010       2009
Current deferred tax assets $      73   $      74
Noncurrent deferred tax assets 25 28
Noncurrent deferred tax liabilities (24 )   (23 )
Net deferred tax assets $ 74 $ 79
 
The Company periodically reviews its deferred tax assets for recoverability. A valuation allowance is established when the Company believes that it is more likely than not that some portion of its deferred tax assets will not be realized. Valuation allowances have been provided to reduce deferred tax assets to amounts considered recoverable. Details of the valuation allowance at June 30 were as follows:
 
      2010       2009
Valuation allowance at beginning of year $      (6 ) $      (7 )
Net (decrease) increase in realizability of foreign deferred tax assets (5 ) 1
Increase in foreign net operating loss carryforward and other (1 ) -
Valuation allowance at end of year   $ (12 )   $ (6 )
 
At June 30, 2010, the Company had no federal foreign tax credit carryforwards. Tax benefits from foreign net operating loss carryforwards of $6 have expiration dates between fiscal years 2011 and 2029. Tax benefits from foreign net operating loss carryforwards of $3 may be carried forward indefinitely.
 
The Company files income tax returns in the U.S. federal and various state, local and foreign jurisdictions. In the second quarter of fiscal year 2009, the Company settled the 2005 fiscal year with the Internal Revenue Service (IRS) and paid $2 in federal taxes and interest. In the first quarter of fiscal year 2010, the Company paid federal tax and interest of $8 related to the 2004 and 2006 fiscal tax years. No tax benefits had previously been recognized for the issues related to the 2004, 2005 and 2006 tax settlements. Certain issues relating to fiscal years 2003, 2004 and 2006 are under review by the IRS Appeals Division. Various income tax returns in state and foreign jurisdictions are currently in the process of examination.
 
The Company recognizes interest and penalties related to uncertain tax positions as a component of income tax expense. As of June 30, 2010 and June 30, 2009, the total balance of accrued interest and penalties related to uncertain tax positions was $22 and $17, respectively. For fiscal year 2010, income tax expense includes $5 of interest and penalties.
 
Following is a reconciliation of the beginning and ending amounts of the Company's gross unrecognized tax benefits:
 
Unrecognized tax benefits - July 1, 2009       $       98
Gross increases - tax positions in prior periods 10
Gross decreases - tax positions in prior periods (15 )
Gross increases - current period tax positions   5
Settlements (14 )
Unrecognized tax benefits - June 30, 2010 $ 84
 
Included in the balance of unrecognized tax benefits at June 30, 2010 and June 30, 2009, respectively, are potential benefits of $57 and $64, respectively, that if recognized, would affect the effective tax rate on earnings.
 
In the twelve months succeeding June 30, 2010, audit resolutions could potentially reduce total unrecognized tax benefits by up to $29, primarily as a result of cash payments. Audit outcomes and the timing of audit settlements are subject to significant uncertainty. 
EMPLOYEE BENEFIT PLANS
EMPLOYEE BENEFIT PLANS
NOTE 20. EMPLOYEE BENEFIT PLANS
 
Retirement Income Plans
 
The Company has qualified and nonqualified defined benefit plans that cover substantially all domestic employees and certain international employees. Benefits are based on either employee years of service and compensation or a stated dollar amount per years of service. The Company is the sole contributor to the plans in amounts deemed necessary to provide benefits and to the extent deductible for federal income tax purposes. Assets of the plans consist primarily of investments in cash equivalents, mutual funds and common collective trusts.
 
The Company made contributions of $43, $30, and $0 to its domestic qualified retirement income plan in fiscal years 2010, 2009 and 2008, respectively. Contributions made to the domestic non-qualified retirement income plans were $8, $7 and $13 in fiscal years 2010, 2009 and 2008, respectively. The Company has also contributed $2, $1, and $1 to its foreign retirement income plans for fiscal years 2010, 2009 and 2008, respectively. The Company's funding policy is to contribute amounts sufficient to meet minimum funding requirements as set forth in employee benefit tax laws plus additional amounts as the Company may determine to be appropriate. At June 30, 2010, based on current pension funding rules, the Company is not required to make any contributions in fiscal year 2011.
 
Retirement Health Care
 
The Company provides certain health care benefits for employees who meet age, participation and length of service requirements at retirement. The plans pay stated percentages of covered expenses after annual deductibles have been met. Benefits paid take into consideration payments by Medicare for the domestic plan. The plans are funded as claims are paid, and the Company has the right to modify or terminate certain of these plans.
 
The assumed domestic health care cost trend rate used in measuring the accumulated post-retirement benefit obligation (APBO) was 8.4% for medical and 9.8% for prescription drugs for fiscal year 2010. These rates have been assumed to gradually decrease each year until an assumed ultimate trend of 4.5% is reached in 2028. The healthcare cost trend rate assumption has an effect on the amounts reported. The effect of a 100 basis point increase or decrease in the assumed healthcare cost trend rate on the total service and interest cost components, and the postretirement benefit obligation was less than $1, respectively, for all three years ended June 30, 2010, 2009 and 2008.
 
Summarized information for the Company's retirement income and healthcare plans at and for the fiscal year ended June 30:
 
Retirement Retirement
Income Health Care
        2010         2009         2010        2009
Change in benefit obligations:
Benefit obligation at beginning of year $      468 $      465 $      70 $      71
       Service cost
 9 10 2 2
       Interest cost 30 29 4 4
       Employee contributions to deferred compensation plans 6 7 - -
       Actuarial loss/(gain) 80 (8 ) 4 (3 )
       Translation adjustment - (3 ) - (1 )
       Benefits paid (33 ) (32 ) (2 ) (3 )
       Benefit obligation at end of year 560 468 78 70
 
Change in plan assets:
       Fair value of assets at beginning of year 275 340 - -
       Actual return on plan assets 39 (68 ) - -
       Employer contributions to qualified and nonqualified plans 53 38 2 3
       Translation adjustment 1 (3 ) - -
Benefits paid (33 ) (32 ) (2 ) (3 )
Fair value of plan assets at end of year 335 275 - -
Funded status — plan assets less than benefit obligation (225 ) (193 ) (78 ) (70 )
 
Accrued benefit cost $ (225 ) $ (193 ) $ (78 ) $ (70 )
 
Amount recognized in the balance sheets consists of:
       Pension benefit assets $ 1 $ 1 $ - $ -
       Current accrued benefit liability     (10 )   (11 ) (5 ) (5 )
       Non-current accrued benefit liability (216 ) (183 )     (73 )     (65 )
       Net amount recognized $ (225 ) $ (193 ) $ (78 ) $ (70 )
 
Information for plans with accumulated benefit obligation (ABO) in excess of plan assets at June 30:
 
Other
Pension Plans Retirement Plans
        2010         2009         2010         2009
Projected benefit obligation $      478 $      392 $      64 $      62
Accumulated benefit obligation   472   384   64 62
Fair value of plan assets 317   261   - -
 
 
The ABO for all pension plans was $490, $398 and $390, respectively, at June 30, 2010, 2009 and 2008. The ABO for all retirement income plans increased by $97 in fiscal year 2010 primarily due to a decrease in the weighted-average discount rate. The Company uses a June 30 measurement date.
 
The net costs of the retirement income and healthcare plans for the fiscal year ended June 30 include the following components:
 
Retirement Income Retirement Health Care
      2010       2009       2008       2010       2009       2008
Components of net periodic benefit cost
       Service cost
 $ 9 $ 10 $ 14 $ 2 $ 2 $ 2
       Interest cost 30 29 28 4 4 5
       Expected return on plan assets (31 ) (28 ) (29 ) - - -
       Amortization of unrecognized items 9 6 7 (2 ) (2 ) (1 )
       Total net periodic benefit cost $ 17 $ 17 $ 20 $ 4 $ 4 $ 6
 
Items not yet recognized as a component of post retirement expense as of June 30, 2010, consisted of:
 
Retirement Retirement
        Income         Health Care
Net actuarial loss (gain) $            267 $            (4 )
Prior service cost (benefit)     - (3 )
Net deferred income tax (assets) liabilities (101 )     2
Accumulated other comprehensive loss (income) $ 166   $ (5 )
 
Net actuarial loss (gain) and prior service cost (benefit) activity recorded in accumulated other comprehensive loss (income) for the fiscal year ended June 30, 2010, included the following:
 
Retirement Retirement
        Income         Health Care
Net actuarial loss (gain) at beginning of year   $            204 $            (9 )
Amortization during the year   (9 ) 1
Loss during the year 72     4
Net actuarial loss (gain) at end of year $ 267 $ (4 )
Prior service benefit at beginning of year $ - $ (4 )
Amortization during the year -   1  
Prior service benefit at end of year $ - $ (3 )
 
The Company uses the straight line amortization method for unrecognized prior service benefit. In fiscal year 2011, the Company expects to recognize, on a pretax basis, approximately $1 of the prior service benefit and $12 of the net actuarial loss as a component of net periodic benefit cost.
 
Weighted-average assumptions used to estimate the actuarial present value of benefit obligations at June 30 are as follows:
 
Retirement Income   Retirement Health Care
      2010       2009       2010       2009
Discount rate   5.34%   6.81%   5.36%   6.80%
Rate of compensation increase 3.99%   4.22%   n/a n/a

Weighted-average assumptions used to estimate the net periodic pension and other postretirement benefit costs for the fiscal years ended June 30 are as follows:
 
Retirement Income
      2010       2009       2008
Discount rate 6.81%   6.75%   6.22%
Rate of compensation increase 4.22%   4.19%   4.18%
Expected return on plan assets 8.11%   8.11%   8.15%
 
  Retirement Health Care
2010 2009 2008
Discount rate 6.80%   6.69%   6.19%
 
Expected benefit payments for the Company's pension and other postretirement plans are as follows:
 
Retirement Retirement
      Income       Health Care
2011   $      32   $      5
2012 33 5
2013 33 6
2014   34 6
2015 35   6
Fiscal years 2016 — 2020 205 31

Expected benefit payments are based on the same assumptions used to measure the benefit obligations and include estimated future employee service.
 
The target allocations and weighted average asset allocations of the investment portfolio for the Company's domestic retirement income plans at June 30 are:
 
% of Plan Assets
% Target at June 30
      Allocation       2010       2009
Asset Category
U.S. equity 50 % 48 % 50 %
International equity 20 19 21
Fixed income 25 27 24
Other 5 6 5
Total      100 %      100 %      100 %
 
 
 
The expected long-term rate of return assumption is based on an analysis of historical experience of the portfolio and the summation of prospective returns for each asset class in proportion to the fund's current asset allocation.
 
The target asset allocation was determined based on the risk tolerance characteristics established for the plans and, at times, may be adjusted to achieve the plans' overall investment objective and to minimize any concentration of investment risk. The Company's objective is to invest plan assets in a manner that will generate resources to pay current and projected plan obligations over the life of the domestic qualified retirement income plan.
 
The following table sets forth by level, within the fair value hierarchy, the retirement income plans' assets carried at fair value as of June 30, 2010:
 
      Level 1       Level 2       Total
Mutual funds $ 196 $ - $ 196
Cash equivalents   1 -   1
Common/collective trusts -   138 138
Total assets at fair value $      197 $      138 $      335
 

Mutual funds are valued at quoted market prices, which represent the net asset values of shares held by the plans at June 30, 2010.
 
Common/collective trust funds are valued at a net asset value unit price determined by the portfolio's sponsor based on the fair value of underlying assets held by the common collective trust fund on June 30, 2010.
 
The carrying value of cash equivalents approximates their fair values at June 30, 2010.
 
Defined Contribution Plans
 
The Company has defined contribution plans for most of its domestic employees. The cost of those plans is based on the Company's profitability and the level of participants' deferrals qualifying for match. The plans include The Clorox Company 401(k) Plan, which has two components, a 401(k) component and a profit sharing component. Employee contributions made to the 401(k) component are partially matched with Company contributions. Company contributions to the profit sharing component above 3% of employee eligible earnings are discretionary and are based on certain Company performance targets for eligible employees. The aggregate cost of the defined contribution plans was $33, $24, and $30 in fiscal years 2010, 2009 and 2008, respectively, including $29, $19, and $26, respectively, of profit sharing contributions. The Company also has defined contribution plans for certain of its international employees. The aggregate cost of these foreign plans was $3, $2 and $3 in fiscal years 2010, 2009 and 2008, respectively.
SEGMENT REPORTING
SEGMENT REPORTING
NOTE 21. SEGMENT REPORTING
 
The Company operates through strategic business units which are aggregated into four reportable segments: Cleaning, Lifestyle, Household and International. The four reportable segments consist of the following:
  • Cleaning consists of laundry, home-care, professional products and auto-care products marketed and sold in the United States. Products within this segment include laundry additives, including bleaches under the Clorox® brand and Clorox 2® stain fighter and color booster; home-care products, primarily under the Clorox®, Formula 409®, Liquid-Plumr®, Pine-Sol®, S.O.S® and Tilex® brands; natural cleaning and laundry products under the Green Works® brand; and auto-care products primarily under the Armor All® and STP® brands.
     
  • Household consists of charcoal, cat litter and plastic bags, wraps and container products marketed and sold in the United States. Products within this segment include plastic bags, wraps and containers, under the Glad® brand; cat litter products, under the Fresh Step®, Scoop Away® and Ever Clean® brands; and charcoal products under the Kingsford® and Match Light® brands.
     
  • Lifestyle consists of food products, water-filtration systems and filters marketed and sold in the United States and all natural personal care products. Products within this segment include dressings and sauces, primarily under the Hidden Valley® and K C Masterpiece® brands, water-filtration systems and filters under the Brita® brand; and all natural personal care products under the Burt's Bees® brand.
     
  • International consists of products sold outside the United States, excluding natural personal care products. These products include home-care, laundry, auto-care, water filtration, charcoal and cat litter products, dressings and sauces, plastic bags, wraps and containers, and insecticides, primarily under the Clorox®, Javex®, Glad®, PinoLuz®, Ayudin®, Limpido®, Clorinda®, Poett®, Mistolin®, Lestoil®, Bon Bril®, Nevex®, Brita®, Armor All®, STP®, Green Works®, Sabra®, Pine-Sol®, Agua Jane® , Ever Clean®, Chux®, Kingsford® and Hidden Valley® brands.
     
Corporate includes certain nonallocated administrative costs, interest income, interest expense and certain other nonoperating income and expenses. Corporate assets include cash and cash equivalents, the Company's headquarters and research and development facilities, information systems hardware and software, pension balances, and other investments.
 
Fiscal Total
       Year        Cleaning        Household        Lifestyle        International        Corporate        Company
Net sales 2010 $     1,838 $     1,663 $     864 $     1,169 $     - $     5,534
2009 1,836 1,726   813 1,075   -   5,450
2008 1,817 1,698 676   1,082 - 5,273
 
Earnings (losses) before income taxes 2010 440 290 303 172 (280 ) 925
2009 410 289 270 140 (298 ) 811
2008 360 225 205 177 (274 ) 693
 
Equity in earnings of affiliates 2010 - - - 9 - 9
2009 - - - 8 - 8
2008 - - - 8 - 8
 
Identifiable assets 2010 1,211 788 1,378 907 271 4,555
2009 1,043 724 1,316 895 598 4,576
 
Capital expenditures 2010 52 58 10 27 56 203
2009 75 45 13 25 39 197
2008 55 46 12 17 40 170
 
Depreciation and amortization 2010 53 77 21 22 12 185
2009 54 82 21 21 12 190
2008 58 89 18 28 12 205
 
Significant non-cash charges included in
       earnings before income taxes:
              Asset impairment costs 2010 - - - - - -
2009 - 3 - - - 3
2008 3 22 - 4 - 29
 
              Share-based compensation 2010 16 13 5 2 24 60
2009 14 13 5 2 24 58
2008 13 12 5 2 15 47
 
 
All intersegment sales are eliminated and are not included in the Company's reportable segments' net sales.
 
Net sales to the Company's largest customer, Wal-Mart Stores, Inc. and its affiliates, were 27% for fiscal years 2010 and 2009 and 26% for fiscal year 2008, of consolidated net sales and occurred in each of the Company's reportable segments. No other customers exceeded 10% of consolidated net sales in any year. During fiscal years 2010, 2009 and 2008, the Company's five largest customers accounted for 45%, 43% and 42% of its net sales, respectively.
 
The Company has three product lines that have accounted for 10% or more of total consolidated net sales during each of the past three fiscal years. In fiscal years 2010, 2009 and 2008, respectively, sales of liquid bleach represented approximately 13%, 13% and 14% of the Company's total consolidated net sales, 25% of net sales in the Cleaning segment for each of the three fiscal years and 21%, 25% and 23% of net sales in the International segment. In fiscal years 2010, 2009 and 2008, respectively, sales of trash bags represented approximately 11%, 12% and 13% of the Company's total consolidated net sales, approximately 31%, 33% and 34% of net sales in the Household segment and approximately 10%, 10% and 11% of net sales in the International segment. Sales of charcoal represented approximately 11% in fiscal year 2010 and approximately 10% in fiscal years 2009 and 2008, respectively, of the Company's total consolidated net sales and approximately 36%, 32% and 30% of net sales in the Household segment, respectively.
 
Net sales and long-lived assets by geographic area at and for the fiscal years ended June 30 were as follows:
 
Fiscal United Total
       Year        States        Foreign        Company
Net sales 2010 $     4,415 $      1,119 $       5,534
2009   4,422 1,028   5,450
2008 4,239 1,034 5,273
 
Long-lived assets 2010 859 120 979
2009 836 119 955
2008 834 126 960
GUARANTEES
GUARANTEES
NOTE 22. GUARANTEES
 
In conjunction with divestitures and other transactions, the Company may provide indemnifications relating to the enforceability of trademarks; pre-existing legal, tax, environmental and employee liabilities; as well as provisions for product returns and other items. The Company has indemnification agreements in effect that specify a maximum possible indemnification exposure. As of June 30, 2010, the Company's aggregate maximum exposure from these agreements is $28 and the Company had not made, nor does it anticipate making, any payments relating to the indemnities.
 
The Company is a party to letters of credit of $19, primarily related to one of its insurance carriers.
 
The Company has not recorded any liabilities on any of the aforementioned guarantees at June 30, 2010.
UNAUDITED QUARTERLY DATA
UNAUDITED QUARTERLY DATA
NOTE 23. UNAUDITED QUARTERLY DATA
 
Quarters Ended
      September 30       December 31       March 31       June 30       Total Year
Fiscal year ended June 30, 2010    
Net sales $      1,372 $      1,279 $      1,366 $      1,517 $      5,534
 
Cost of products sold $ 753 $ 718 $ 749 $ 837 $ 3,057
 
Net earnings $ 157 $ 110 $ 165 $ 171 $ 603
 
Per common share:
       Net earnings
              Basic $ 1.12 $ 0.78 $ 1.17 $ 1.21 $ 4.28
              Diluted 1.11 0.77 1.16 1.20 4.24
Dividends declared per common share $ 0.50 $ 0.50 $ 0.50 $ 0.55 $ 2.05
Market price (NYSE)
       High $ 61.64 $ 63.10 $ 65.18 $ 65.67 $ 65.67
       Low 55.41 56.36 58.96 60.85 55.41
       Year-end 62.16
 
Fiscal year ended June 30, 2009
Net sales $ 1,384 $ 1,216 $ 1,350 $ 1,500 $ 5,450
 
Cost of products sold $ 822 $ 730 $ 739 $ 813 $ 3,104
 
Net earnings $ 128 $ 86 $ 153 $ 170 $ 537
 
Per common share:
       Net earnings
              Basic $ 0.91 $ 0.62 $ 1.08 $ 1.21 $ 3.82
              Diluted 0.90 0.61 1.08 1.20 3.79
Dividends declared per common share $ 0.46 $ 0.46 $ 0.46 $ 0.50 $ 1.88
Market price (NYSE)
       High $ 65.00 $ 64.00 $ 56.60 $ 57.43 $ 65.00
       Low 47.48 52.05 45.67 50.31 45.67
       Year-end 55.83
VALUATION AND QUALIFYING ACCOUNTS AND RESERVES
VALUATION AND QUALIFYING ACCOUNTS AND RESERVES
VALUATION AND QUALIFYING ACCOUNTS AND RESERVES (Dollars in Millions)
 
Column A Column B Column C Column D Column E
Additions Deductions
Balance at Charged to Charged Credited to Credited Balance at
beginning costs and to other costs and to other end
Description       of period       expenses       accounts       expenses       accounts       of period
Allowance for doubtful accounts  
       Year ended June 30, 2010 $        (6 ) $         - $ - $ - $ - $        (6 )
       Year ended June 30, 2009   (7 ) (3 )   - - 4 (6 )
       Year ended June 30, 2008 (5 )   (4 ) -   - 2 (7 )
LIFO allowance
       Year ended June 30, 2010 (31 ) 3 - - - (28 )
       Year ended June 30, 2009 (21 ) (10 ) - - - (31 )
       Year ended June 30, 2008 (18 ) (3 ) - - - (21 )
Valuation allowance on deferred tax assets
       Year ended June 30, 2010 (6 ) (6 ) - - - (12 )
       Year ended June 30, 2009 (7 ) - - 1 - (6 )
       Year ended June 30, 2008 (22 ) - - 15 - (7 )

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policy)
Nature of Operations and Basis of Presentation 
Nature of Operations and Basis of Presentation
 
The Company is principally engaged in the production, marketing and sales of consumer products through mass merchandisers, grocery stores and other retail outlets. The consolidated financial statements include the statements of the Company and its majority-owned and controlled subsidiaries. All significant intercompany transactions and accounts were eliminated in consolidation. Certain prior year reclassifications were made in the consolidated financial statements and related notes to consolidated financial statements to conform to the current year presentation.
 
Use of Estimates 
Use of Estimates
 
The preparation of these consolidated financial statements in conformity with accounting principles generally accepted in the United States of America (U.S. GAAP) requires management to make estimates and assumptions that affect reported amounts and related disclosures. Specific areas requiring the application of management's estimates and judgment include assumptions pertaining to accruals for consumer and trade-promotion programs, share-based compensation costs, pension and post-employment benefit costs, future cash flows associated with impairment testing of goodwill and other long-lived assets, credit worthiness of customers, uncertain tax positions, tax valuation allowances and legal, environmental and insurance matters. Actual results could materially differ from estimates and assumptions made.
 
Foreign Currency Translation 
Foreign Currency Translation
 
Other than Venezuela, which operates in a highly inflationary economy, local currencies are the functional currencies for substantially all of the Company's other foreign operations. When the transactional currency is different than the functional currency, transaction gains and losses are included as a component of other expense (income), net. In addition, certain assets and liabilities denominated in currencies different than a foreign subsidiary's functional currency are reported on the subsidiary's books in its functional currency, with the impact from exchange rate differences recorded in other expense (income), net. Assets and liabilities of foreign operations are translated into U.S. dollars using the exchange rates in effect at the balance sheet date. Income and expenses are translated at the average monthly exchange rates during the year. Gains and losses on foreign currency translations are reported as a component of other comprehensive income. Deferred taxes are not provided on cumulative translation adjustments where the Company expects earnings of a foreign subsidiary to be indefinitely reinvested. The income tax effect of currency translation adjustments related to foreign subsidiaries from certain subsidiaries and joint ventures that are not considered indefinitely reinvested is recorded as a component of deferred taxes with an offset to other comprehensive income.

Venezuela
 
Prior to December 31, 2009, the Company translated its Venezuelan subsidiary's financial statements using Venezuela's official currency exchange rate, which had been fixed by the Venezuelan government at 2.15 bolivar fuertes (VEFs) to the U.S. dollar. Effective December 31, 2009, the Company began translating its Venezuelan subsidiary's financial statements using the parallel market currency exchange rate (exchange rates negotiated with local financial intermediaries), the rate at which the Company expected to be able to remit dividends or return capital. The rate used at December 31, 2009, was 5.87 VEFs to the U.S. dollar. On a pre-tax basis, this change in the rate used for converting these currencies resulted in a one time re-measurement loss of $12 during the Company's fiscal quarter ended December 31, 2009, which related primarily to U.S. dollar denominated inventory purchases.
 
Effective January 1, 2010, the financial statements for the Company's Venezuelan subsidiary have been consolidated under the rules governing the translation of financial information in a highly inflationary economy. Under U.S. GAAP, an economy is considered highly inflationary if the cumulative inflation rate for a three-year period meets or exceeds 100 percent. If a subsidiary is considered to be in a highly inflationary economy, the financial statements of the subsidiary must be re-measured into the Company's reporting currency (U.S. dollar) and future exchange gains and losses from the re-measurement of non-U.S. dollar monetary assets and liabilities are reflected in current net earnings, rather than exclusively in the equity section of the balance sheet, until such time as the economy is no longer considered highly inflationary. Nonmonetary assets and liabilities, such as inventory, property, plant and equipment and prepaid expenses are recorded in U.S. dollars at the historical rates at the time of acquisition of such assets or liabilities.
 
In May 2010, the Venezuela government suspended the functioning of the parallel currency exchange market and in June 2010, the Venezuela Central Bank established an alternative currency exchange market. This alternative market includes volume restrictions on the amount of U.S. dollars which may be converted each month. In June 2010, the Company began utilizing the exchange rate at which the Company was purchasing U.S. dollars through the alternative market, which was 5.3 VEFs to the U.S. dollar, as the translation rate for the Company's Venezuelan subsidiary's financial statements. Accordingly, the Company recorded a gain in other expense (income), net of $2 during the fiscal quarter ended June 30, 2010.
 
At June 30, 2010, the net asset position of the Company's Venezuelan subsidiary was $4, which included cash balances of approximately $8, of which approximately $6 was denominated in VEFs. Of the $4 net asset position, approximately $11 was associated with VEFs-denominated monetary net assets and deferred income taxes. For the fiscal year 2010, Venezuela's net sales and total assets represented approximately 2% and 1% of the total Company's net sales and total assets, respectively.
 
Cash and Cash Equivalents 
Cash and Cash Equivalents
 
Cash equivalents consist of highly liquid instruments, time deposits and money market funds with an initial maturity at purchase of three months or less. The fair value of cash and cash equivalents approximates the carrying amount.
 
The Company's cash position includes amounts held by foreign subsidiaries, and the repatriation of certain cash balances from some of the Company's foreign subsidiaries could result in additional tax costs. However, these cash balances are generally available without legal restriction to fund local business operations. In addition, a portion of the Company's cash balances are held in U.S. dollars by foreign subsidiaries, whose functional currency is their local currency. Such U.S. dollar balances are reported on the foreign subsidiaries books, in their functional currency, with the impact from exchange rate differences recorded in other expense (income), net. The Company's cash holdings as of the end of fiscal years 2010 and 2009 were as follows:
 
2010       2009
Non-U.S. dollar balances held by non-U.S. dollar functional currency subsidiaries $ 42 $ 74
U.S. dollar balances held by non-U.S. dollar functional currency subsidiaries 13     52
Non-U.S. dollar balances held by U.S. dollar functional currency subsidiaries   7 13
U.S. dollar balances including those balances held by U.S. dollar functional currency subsidiaries 25 67
Total $        87 $        206
 
Inventories 
Inventories
 
Inventories are stated at the lower of cost or market. When necessary, the Company provides allowances to adjust the carrying value of its inventory to the lower of cost or market, including any costs to sell or dispose. Appropriate consideration is given to obsolescence, excessive inventory levels, product deterioration and other factors in evaluating net realizable value for the purposes of determining the lower of cost or market.
 
Property, Plant and Equipment and Finite-Lived Intangible Assets 
Property, Plant and Equipment and Finite-Lived Intangible Assets
 
Property, plant and equipment and finite-lived intangible assets are stated at cost. Depreciation and amortization expense are calculated by the straight-line method using the estimated useful lives of the related assets. The table below provides estimated useful lives of property, plant and equipment by asset classification (See Note 8 for estimated useful lives of finite-lived intangible assets).
 
Expected
Classification Useful Lives
Land improvements      10 - 30 years
Buildings 10- 40 years
Machinery and equipment 3- 15 years
Computer equipment 3- years
Capitalized software costs 3- 7 years

Property, plant and equipment and finite-lived intangible assets are reviewed for impairment whenever events or changes in circumstances occur that indicate that the carrying amount of an asset (or asset group) may not be recoverable. The Company's impairment review is based on an estimate of the undiscounted cash flows at the lowest level for which identifiable cash flows exist. Impairment occurs when the book value of the asset exceeds the estimated future undiscounted cash flows generated by the asset and the impairment is viewed as other than temporary. When an impairment is indicated, an impairment charge is recorded for the difference between the book value of the asset and its estimated fair market value. Depending on the asset, estimated fair market value may be determined either by use of a discounted cash flow model, or by reference to estimated selling values of assets in similar condition.
 
Impairment Review of Goodwill and Indefinite-Lived Intangible Assets 
Impairment Review of Goodwill and Indefinite-Lived Intangible Assets
 
The Company tests its goodwill, trademarks with indefinite lives and other indefinite-lived intangible assets annually unless there are indications during a different interim period that these assets may have become impaired. With respect to goodwill, impairment occurs when the carrying amount of a reporting unit's goodwill exceeds its implied fair value. An impairment charge is recorded for the difference between the carrying amount and the implied fair value of the reporting unit's goodwill. For trademarks and other intangible assets with indefinite lives, impairment occurs when the carrying amount of an asset is greater than its estimated fair value. A charge is recorded for the difference between the carrying amount and the estimated fair value. The Company's estimates of fair value are based primarily on a discounted cash flow approach that requires significant management judgment with respect to future sales volumes, revenue and expense growth rates, changes in working capital, foreign-exchange rates, devaluation, inflation and the selection of an appropriate discount rate.
 
During the fourth quarter of fiscal year 2010, the Company changed the date of its annual impairment test of goodwill and indefinite-lived intangible assets from January 1 to April 1. The change was made to align more closely the annual impairment test with the Company's long-range planning and forecasting process. The change did not delay, accelerate, nor avoid an impairment charge. The Company has determined that this change in accounting principle is preferable under the circumstances.
 
The Company, therefore, performed its annual impairment test of goodwill and indefinite-lived intangible assets as of January 1, 2010, and again as of April 1, 2010. No instances of impairment were identified during the test.
 
Share-Based Compensation 
Share-Based Compensation
 
The Company records compensation expense associated with stock options and other forms of equity compensation based on their fair values on the dates they are granted. The expense is recorded by amortizing the fair values on a straight-line basis over the vesting period, adjusted for estimated forfeitures.
 
Cash flows resulting from tax deductions in excess of the cumulative compensation cost recognized for the options exercised (excess tax benefit) are classified as financing cash flows. However, cash flows relating to excess tax benefits for employees directly involved in the manufacturing and/or distribution processes are classified as operating cash flows. For the fiscal years ended June 30 2010, 2009 and 2008, $10, $6, and $9, respectively, of excess tax benefits were generated from share-based payment arrangements, and were recognized as financing cash flows.
 
Employee Benefits 
Employee Benefits
 
The Company has qualified and nonqualified defined benefit plans that cover substantially all domestic employees and certain international employees and provide health care benefits for domestic employees who meet age, participation and length of service requirements at retirement.
 
The Company accounts for its defined benefit and retirement health care plans using actuarial methods. These methods use an attribution approach that generally spreads "plan events" over the service lives of plan participants. Examples of plan events are plan amendments and changes in actuarial assumptions such as the expected return on plan assets, discount rate, rate of compensation increase, and certain employee-related factors, such as retirement age and mortality. The principle underlying the attribution approach is that employees render service over their service lives on a relatively "smooth" basis, and therefore the statement of earnings effects of defined benefit and retirement heath care plans are recognized in the same pattern.
 
One of the principal assumptions used in the net periodic benefit cost calculation is the expected return on plan assets. The required use of an expected return on plan assets may result in recognized pension expense or income that differs from the actual returns of those plan assets in any given year. Over time, however, the goal is for the expected long-term returns to approximate the actual returns and, therefore, the expectation is that the pattern of income and expense recognition should closely match the pattern of the services provided by the participants. The Company uses a market-related value method for calculating plan assets for purposes of determining the amortization of actuarial gains and losses. This method employs an asset smoothing approach. The differences between actual and expected returns are recognized in the net periodic benefit cost calculation over the average remaining service period of the plan participants using the corridor approach. Under this approach, only actuarial gains (losses) that exceed 5% of the greater of the projected benefit obligation or the market-related value of assets are amortized to pension expense by the Company. In developing its expected return on plan assets, the Company considers the long-term actual returns relative to the mix of investments that comprise its plan assets and also develops estimates of future investment returns by considering external sources.

The Company recognizes an actuarial-based obligation at the onset of disability for certain benefits provided to individuals after employment, but before retirement, that include medical, dental, vision, life and other benefits.
 
The Company also has various individual and group incentive compensation programs, including a performance unit program, a bonus program, and a profit sharing element of the Company 401(k) plan. The Company's contributions to the profit sharing element of the 401(k) plan and payments to managerial staff and executive management for the annual bonus program are based on achieving Company performance targets. The Company also matches employee 401(k) contributions up to one thousand dollars per year for eligible employees.
 
Environmental Costs 
Environmental Costs
 
The Company is involved in certain environmental remediation and on-going compliance activities. Accruals for environmental matters are recorded on a site-by-site basis when it is probable that a liability has been incurred and the amount of the liability can be reasonably estimated. The Company's accruals reflect the anticipated participation of other potentially responsible parties in those instances where it is probable that such parties are legally responsible and financially capable of paying their respective shares of the relevant costs. These accruals are adjusted periodically as assessment and remediation efforts progress or as additional technical or legal information becomes available. Actual costs to be incurred at identified sites in future periods may vary from the estimates, given the inherent uncertainties in evaluating environmental exposures. The aggregate accrual for environmental matters is included in other liabilities in the Company's consolidated balance sheets on an undiscounted basis due to the uncertainty and timing of future payments.
 
Restructuring Liabilities 
Restructuring Liabilities
 
Liabilities for costs associated with exit or disposal activities are recognized and measured initially at estimated fair value in the period in which the liability is incurred. A liability for costs that will continue to be incurred under a contract for its remaining term without economic benefit to the Company is recognized at estimated fair value when the Company ceases using the right conveyed by the contract. The Company records employee termination liabilities once they are both probable and estimable for severance provided under the Company's existing severance policy. Employee termination liabilities outside of the Company's existing severance policy are recognized at the time the group of employees is notified, unless the group will be retained to render service beyond a minimum retention period, in which case the liability is recognized ratably over the future service period.
Revenue Recognition 
Revenue Recognition
 
Sales are recognized as revenue when the risk of loss and title pass to the customer and when all of the following have occurred: a firm sales arrangement exists, pricing is fixed or determinable, and collection is reasonably assured. Sales are recorded net of allowances for returns, trade-promotions, coupons and other discounts. The Company routinely commits to one-time or on-going trade-promotion programs with customers, and consumer coupon programs that require the Company to estimate and accrue the expected costs of such programs. Programs include shelf price reductions, advantageous end-of-aisle or in-store displays of the Company's products and graphics and other trade-promotion activities conducted by the customer. Coupons are recognized as a liability when distributed based upon expected consumer redemptions. The Company maintains liabilities at the end of each period for the estimated expenses incurred, but unpaid for these programs. Trade-promotion and coupon costs are recorded as a reduction of sales. The Company provides an allowance for doubtful accounts based on its historical experience and a periodic review of its accounts receivable. Receivables were presented net of an allowance for doubtful accounts of $6 at June 30, 2010 and 2009. The Company's provision for doubtful accounts was $0, $3, and $4 in fiscal years 2010, 2009, and 2008, respectively.
 
Cost of Products Sold 
Cost of Products Sold
 
Cost of products sold represents the costs directly related to the manufacture and distribution of the Company's products and primarily includes raw materials, packaging, contract packer fees, shipping and handling, warehousing, package design, depreciation, amortization and direct and indirect labor and operating costs for the Company's manufacturing facilities including salary, benefit costs and incentive compensation.
  
Costs associated with developing and designing new packaging are expensed as incurred and include design, artwork, films, and labeling. Expenses for fiscal years ended June 30, 2010, 2009 and 2008 were $9, $8, and $9, respectively, of which $8 in each of the fiscal years was classified as cost of products sold, with the remainder classified as selling and administrative expenses.
Selling and Administrative Expenses 
Selling and Administrative Expenses
  
Selling and administrative expenses represent costs incurred by the Company in generating revenues and managing the business and include market research, commissions, and certain administrative expenses. Administrative expenses include salary, benefits, incentive compensation, professional fees and services, software and licensing fees, and other operating costs associated with the Company's non-manufacturing, non-research and development staff, facilities and equipment.
Advertising and Research and Development Costs 
Advertising and Research and Development Costs
  
The Company expenses advertising and research and development costs in the period incurred.
Income Taxes 
Income Taxes
  
The Company uses the asset and liability method to account for income taxes. Deferred tax assets and liabilities are recognized for the anticipated future tax consequences attributable to differences between financial statement amounts and their respective tax bases. Management reviews the Company's deferred tax assets to determine whether their value can be realized based upon available evidence. A valuation allowance is established when management believes that it is more likely than not that some portion of its deferred tax assets will not be realized. Changes in valuation allowances from period to period are included in the Company's tax provision in the period of change. In addition to valuation allowances, the Company provides for uncertain tax positions when such tax positions do not meet certain recognition thresholds or measurement standards. Amounts for uncertain tax positions are adjusted in quarters when new information becomes available or when positions are effectively settled.
  
U.S. income tax expense and foreign withholding taxes are provided on unremitted foreign earnings that are not indefinitely reinvested at the time the earnings are generated. Where foreign earnings are indefinitely reinvested, no provision for U.S. income or foreign withholding taxes is made. When circumstances change and the Company determines that some or all of the undistributed earnings will be remitted in the foreseeable future, the Company accrues an expense in the current period for U.S. income taxes and foreign withholding taxes attributable to the anticipated remittance.
  
On March 23, 2010, the Patient Protection and Affordable Care Act (PPACA) was signed into law, and, on March 30, 2010, the Health Care and Education Reconciliation Act of 2010 was signed into law. The PPACA changes the tax treatment of federal subsidies received by sponsors of retiree health benefit plans that provide a benefit similar to Medicare Part D. These subsidies were previously non-taxable, but will become taxable effective in tax years beginning after December 31, 2012. The Company has concluded that the impact of the future elimination of this tax deduction on its financial statements is and will be insignificant.
Derivative Instruments 
Derivative Instruments
  
The Company's use of derivative instruments, principally swap, futures, and forward contracts, is limited to non-trading purposes and is designed to partially manage exposure to changes in interest rates, foreign currencies and commodity prices. The Company's contracts are hedges for transactions with notional balances and periods consistent with the related exposures and do not constitute investments independent of these exposures.
  
Most commodity derivative contracts and foreign-exchange contracts are designated as cash flow hedges of certain raw material and finished goods inventory purchase obligations based on certain hedge criteria. The criteria used to determine if hedge accounting treatment is appropriate are: (a) if the designation of the hedge is to an underlying exposure and (b) whether there is sufficient correlation between the value of the derivative instrument and the underlying obligation. The changes in the fair value of derivatives are recorded as either assets or liabilities in the balance sheet with an offset to net earnings or other comprehensive income, depending on whether, for accounting purposes, the derivative is designated and qualified as a hedge. From time to time, the Company may have contracts not designated as hedges for accounting purposes, for which it recognizes changes in the fair value of these contracts in other expense (income), net.
  
The Company uses different methodologies, when necessary, to estimate the fair value of its derivative contracts. The estimated fair values of the majority of the Company's contracts are based on quoted market prices, traded exchange market prices, or broker price quotations, and represent the estimated amounts that the Company would pay or receive to terminate the contracts.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables)
Impact of adoption of new accounting standard 
Basic Diluted
As previously As previously
      reported       As restated       reported       As restated
Year ended June 30, 2009   $        3.86   $        3.82   $        3.81   $        3.79
Year ended June 30, 2008 3.30 3.27 3.24 3.23
Components of cash and cash equivalents 
2010       2009
Non-U.S. dollar balances held by non-U.S. dollar functional currency subsidiaries $ 42 $ 74
U.S. dollar balances held by non-U.S. dollar functional currency subsidiaries 13     52
Non-U.S. dollar balances held by U.S. dollar functional currency subsidiaries   7 13
U.S. dollar balances including those balances held by U.S. dollar functional currency subsidiaries 25 67
Total $        87 $        206
Useful life of property, plant and equipment 
Expected
Classification Useful Lives
Land improvements      10 - 30 years
Buildings 10- 40 years
Machinery and equipment 3- 15 years
Computer equipment 3- years
Capitalized software costs 3- 7 years
BUSINESSES ACQUIRED (Tables)
Audited pro forma results of business acquired 
2010 2009 2008
Years ended June 30         As reported         As reported         Pro forma
Net Sales $ 5,534   $ 5,450   $ 5,343
Net earnings     603   537 472
Diluted net earnings per common share $      4.24 $      3.79 $      3.32
Estimated fair value of Burt's Bees' assets acquired and liabilities assumed and related deferred income taxes 
Assets acquired
       Cash $ 33
       Inventory 45
       Other current assets 24
       Property, plant and equipment 16
       Goodwill 613
       Intangible assets not subject to amortization - trademarks 322
       Intangible assets subject to amortization:
                 Customer list 44
                 Product formulae   8
       Other assets 1
Total assets acquired 1,106
 
Liabilities assumed
       Current liabilities - primarily accounts payable and accrued liabilities 52
       Other liabilities 3
       Current and noncurrent deferred income taxes 138
Total liabilities assumed 193
Net assets acquired $      913
 
RESTRUCTURING AND ASSET IMPAIRMENT (Tables)
Year Ended
Jun. 30, 2010
Reconciliation of the accrual for the Supply Chain and Other restructuring charges
Text Block 
Cost Of Products Sold [Member]
 
Schedule of restructuring and related costs
Text Block 
Severance [Member]
 
Schedule of restructuring and related costs
Text Block 
Reconciliation of the accrual for the Supply Chain and Other restructuring charges 
Asset Accumulated
Severance         Impairments         Depreciation         Other         Total
Accrual Balance as of June 30, 2007 $ - $ - $ - $ - $ -  
2008 Charges 7 29 20 3 59
Cash payments (2 ) - - (3 ) (5 )
Charges against assets - (29 ) (20 ) - (49 )
Accrual Balance as of June 30, 2008 5 - - - 5
2009 Charges 17 3 8 11 39
Cash payments (7 ) - - (11 ) (18 )
Charges against assets - (3 )   (8 ) - (11 )
Accrual Balance as of June 30, 2009 15       - - -   15
2010 Charges 7 -   4     9   20
Cash payments   (16 ) - -   (9 ) (25 )
Adjustments (3 ) -   - - (3 )
Charges against assets - - (4 ) - (4 )
Accrual Balance as of June 30, 2010 $      3 $      - $      - $      - $      3
 
Schedule of restructuring and related costs 
2010        2009        2008
Cleaning $ 6 $ 11 $ 9
Household   4 5   10
International - 1 3
Corporate 3     2 1
Total Company $       13 $       19 $       23
 
Schedule of restructuring and related costs 
2010        2009        2008
Cleaning $ 2 $ 3 $ 3
Household 2   -   -
International -   2   2
Corporate   - 12 2
Total Company $      4 $      17 $      7
 
INVENTORIES, NET (Tables)
Schedule of inventories, net
2010        2009
Finished Goods $ 300 $ 304
Raw materials and packaging   102 99
Work in process 4 4  
LIFO allowances (28 )     (31 )
Allowances for obsolescence (11 ) (10 )
Total $       367 $       366
 
OTHER CURRENT ASSETS (Tables)
Other current assets
         2010        2009
Deferred tax assets   $ 73 $ 74
Prepaid expenses   40   42
Other   13     6
Total $      126 $      122
 
PROPERTY, PLANT AND EQUIPMENT, NET (Tables)
Property, Plant and Equipment
         2010        2009
Machinery and equipment $ 1,515   $ 1,431  
Buildings   582     568  
Capitalized software costs   302     289  
Construction in progress   166     146  
Land and improvements   127     127  
Computer equipment   92     93  
    2,784     2,654  
Less: Accumulated depreciation and amortization   (1,805 )   (1,699 )
Total $      979   $      955  
                 
GOODWILL, TRADEMARKS AND OTHER INTANGIBLE ASSETS (Tables)
Schedule of goodwill 
Goodwill
       Cleaning        Lifestyle        Household        International        Total
Balance June 30, 2008 $ 555 $ 622 $ 85 $ 396 $ 1,658
Translation adjustments and other   - 1 -   (29 ) (28 )
Balance June 30, 2009 555 623   85 367 1,630  
Acquisitions   9   - - -   9
Translation adjustments and other -   -   -   11     11
Balance June 30, 2010 $       564 $       623 $       85 $       378 $       1,650
 
Schedule of intangible assets, excluding goodwill 
Other intangible assets
Trademarks subject to amortization
Technology
Subject to Not subject to and Product
        amortization          amortization         Total         formulae         Other         Total
Balance June 30, 2008 $ 1 $ 559 $ 560 $ 63 $ 60 $ 123
Amortization (1 ) - (1 ) (10 ) (5 ) (15 )
Transfers 14 (14 ) - - - -
Translation adjustments and other   - (2 ) (2 ) - (3 ) (3 )
Balance June 30, 2009 14     543 557   53 52 105
Acquisitions   6 - 6   - 4 4
Amortization (2 ) -   (2 )   (9 )   (5 ) (14 )
Transfers 5   (5 )   - (7 ) 7     -
Translation adjustments and other 1 - 1 - 1 1
Balance June 30, 2010 $       24 $       538 $       562 $       37 $       59 $       96
 
OTHER ASSETS (Tables)
Other assets
       2010        2009
Equity investments $ 49   $ 45
Investment in insurance contracts 35 35
Deferred tax assets 25 28
Investment in low-income housing partnerships   11 13
Deferred financing costs 10 10
Other 14 18
Total $      144 $      149
 
ACCRUED LIABILITIES (Tables)
Accrued liabilities
       2010        2009
Compensation and employee benefit costs $ 149 $ 123
Trade and sales promotion 109   86
Dividends   78   70
Interest   40 49
Other 116 144
Total $      492 $      472
 
DEBT (Tables)
Notes and loans payable 
        2010         2009
Commercial paper   $ 369   $ 419
Foreign borrowings 2 2
Total $      371 $      421
 
Long-term debt 
        2010         2009
Senior unsecured notes and debentures:
       4.20%, $575 due January 2010 $ - $ 575
       6.125%, $300 due February 2011 300 305
       5.45%, $350 due October 2012 349 349
       5.00%, $500 due March 2013 500 499
       5.00%, $575 due January 2015 575 575  
       3.55%, $300 due November 2015 299 -
       5.95%, $400 due October 2017   398 398
Foreign borrowings   3 27
Total 2,424   2,728
Less: Current maturities (300 ) (577 )
Long-term debt $      2,124   $      2,151
 
Credit facilities 
        2010         2009
Revolving credit line   $ 1,100   $ 1,100
Foreign credit lines   23 57
Other credit lines 12 3
Total $      1,135 $      1,160
 
FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS (Tables)
Derivative financial instruments designated as hedging instruments recorded at fair value 
Fair value
       Balance Sheet location        6/30/2010        6/30/2009
Assets
Foreign exchange contracts   Other current assets $ 1 $ -
Commodity purchase contracts Other current assets   -   6
$ 1   $ 6  
 
Liabilities
Commodity purchase contracts Accrued liabilities $      (2 ) $      (21 )
 
Effects of derivative financial instruments designated as hedging instruments on OCI and on statement of earnings 
        Loss reclassified from
Loss recognized in OCI and recognized
Cash flow hedges       OCI       in earnings
Commodity purchase contracts   $                     (3 ) $                        (15 )
Foreign exchange contracts (2 ) (3 )
Total $ (5 ) $ (18 )
 
Derivative financial instruments not designated as hedging instruments 
      Fair value
Balance Sheet location       6/30/2010       6/30/2009
Liabilities  
Commodity purchase contracts Accrued liabilities   $      (1 ) $           -
 
OTHER LIABILITIES (Tables)
Other liabilities
2010       2009
Employee benefit obligations $      306 $      266
Venture agreement net terminal obligation 274 269
Taxes 64   65
Other   33 40
Total $ 677 $ 640
 
STOCKHOLDERS' EQUITY (DEFICIT) (Tables)
Accumulated other comprehensive net losses, net of tax
      2010       2009       2008
Currency translation $ (211 ) $ (220 ) $ (142 )
Derivatives 1 (9 ) 30
Pension and postretirement benefit adjustments (161 ) (118 ) (67 )
Total $     (371 ) $     (347 ) $     (179 )
 
EARNINGS PER SHARE (Tables)
Reconciliation of net earnings to net earnings applicable to common stock 
      2010       2009       2008
Net earnings $      603 $      537 $      461
Less: Earnings allocated to participating securities 3 5 5
Net earnings applicable to common stock $ 600 $ 532 $ 456
     
Weighted Average Number of Shares Outstanding
      2010       2009       2008
Basic   140,272   139,015   139,633
Dilutive effect of stock options and other (excludes participating securities)   1,262   1,154   1,564
Diluted   141,534   140,169   141,197
       
Effects of participating securities on weighted-average number of shares outstanding 
       2010       2009       2008
Stock options        3,978        5,090        2,719
SHARE-BASED COMPENSATION PLANS (Tables)
Compensation cost and related income tax benefit for share-based compensation plans 
      2010       2009       2008
Cost of products sold $       8 $       8 $       7
Selling and administrative expenses 46 45 36
Research and development costs 6 5 4
Total compensation cost $ 60 $ 58 $ 47
Related income tax benefit $ 22 $ 22 $ 18
 
Share-based compensation award assumptions used for determining fair values 
      2010       2009       2008
Expected life 5years 5years 5years
Expected volatility 21.6% to 22.9% 23.4%   21.0% to 22.2%
Weighted-average volatility   22.0%   23.4%   21.6%
Risk-free interest rate 2.2% to 2.4% 2.6%   2.8% to 4.2%
Dividend yield 3.4% to 3.6%   3.0%   2.7% to 3.0%
Weighted-average dividend yield 3.6%   3.0%   2.7%
Stock option plan shares issuable 
Weighted- Average
Average Remaining Aggregate
Number of Exercise Contractual Intrinsic
Shares Price per Share Life Value
        (In thousands)                        
Outstanding at June 30, 2009            10,089 $       53 6 years $       32
Granted 1,924   57
Exercised (1,701 ) 41      
Cancelled (301 )   60  
Outstanding at June 30, 2010 10,011 55 6years 68
 
Options vested and exercisable at June 30, 2010 6,087 52 4years 61
Restricted stock awards 
Weighted-Average
Grant Date
Number of Fair Value
        Shares         per Share
(In thousands)
Restricted stock awards at June 30, 2009                 196 $      62
Granted 5 59
Vested (83 ) 61
Forfeited (6 ) 62
Restricted stock awards at June 30, 2010 112 62
 
LEASES AND OTHER COMMITMENTS (Tables)
Future minimum rent obligations
       Future Minimum
Fiscal Year   Rental Payments
2011 $       32
2012   35
2013 31
2014 26
2015 21
Thereafter 81
Total $ 226
 
OTHER EXPENSE (INCOME), NET (Tables)
Major components of other expense (income), net
      2010       2009       2008
Foreign exchange transaction losses, net $        26 $        28 $        2
Amortization of trademarks and other intangible assets 9 7 7
Low-income housing partnership losses (Note 8) 1 3 7
Equity in earnings of unconsolidated affiliates (9 ) (8 ) (8 )
Interest income (3 ) (4 ) (12 )
Other 1 - (5 )
Total other expense (income), net $ 25 $ 26 $ (9 )
 
INCOME TAXES (Tables)
Provision for income taxes by tax jurisdiction 
      2010       2009       2008
Current
       Federal
 $       227 $       194 $       203
       State 29 40 28
       Foreign 42 41 52
Total current   298 275 283
Deferred
       Federal 18 2 (36 )
       State 2   3 (3 )
       Foreign 4   (6 ) (12 )
Total deferred   24 (1 ) (51 )
Total $ 322 $ 274   $ 232
 
Domestic and foreign earnings before taxes 
      2010       2009       2008
United States   $       773 $       669 $       538
Foreign   152   142 155
Total $ 925 $ 811   $ 693
 
Effective income tax rate reconciliation 
      2010       2009       2008
Statutory federal tax rate      35.0 %      35.0 %      35.0 %
State taxes (net of federal tax benefits) 2.2 3.4 2.5
Tax differential on foreign earnings (1.0 ) (1.8 )   0.1
Net adjustment of prior year federal and state tax accruals (0.4 ) (2.0 ) 1.0
Change in valuation allowance 0.6   0.1   (2.3 )
Domestic manufacturing deduction (1.7 ) (1.8 ) (1.7 )
Other differences   0.1   0.9   (1.0 )
Effective tax rate 34.8 %   33.8 % 33.6 %
 
Components of net deferred tax assets 
      2010       2009
Deferred tax assets
       Compensation and benefit programs
 $      201 $      177
       Basis difference related to Venture Agreement 30 30
       Accruals and reserves 25 30
       Inventory costs 13 16
       Other 63 60
              Subtotal 332 313
       Valuation allowance (12 ) (6 )
       Total deferred tax assets 320 307
 
Deferred tax liabilities
       Fixed and intangible assets (188 ) (176 )
       Low-income housing partnerships (28 ) (27 )
       Other (30 ) (25 )
       Total deferred tax liabilities (246 ) (228 )
       Net deferred tax assets $ 74 $ 79
 
Current and noncurrent deferred tax assets and liabilities 
      2010       2009
Current deferred tax assets $      73   $      74
Noncurrent deferred tax assets 25 28
Noncurrent deferred tax liabilities (24 )   (23 )
Net deferred tax assets $ 74 $ 79
 
Deferred tax assets valuation allowance movement analysis 
      2010       2009
Valuation allowance at beginning of year $      (6 ) $      (7 )
Net (decrease) increase in realizability of foreign deferred tax assets (5 ) 1
Increase in foreign net operating loss carryforward and other (1 ) -
Valuation allowance at end of year   $ (12 )   $ (6 )
 
Reconciliation of gross unrecognized tax benefits 
Unrecognized tax benefits - July 1, 2009       $       98
Gross increases - tax positions in prior periods 10
Gross decreases - tax positions in prior periods (15 )
Gross increases - current period tax positions   5
Settlements (14 )
Unrecognized tax benefits - June 30, 2010 $ 84
 
EMPLOYEE BENEFIT PLANS (Tables)
Summarized information for defined benefit retirement income and healthcare plans 
Retirement Retirement
Income Health Care
        2010         2009         2010        2009
Change in benefit obligations:
Benefit obligation at beginning of year $      468 $      465 $      70 $      71
       Service cost
 9 10 2 2
       Interest cost 30 29 4 4
       Employee contributions to deferred compensation plans 6 7 - -
       Actuarial loss/(gain) 80 (8 ) 4 (3 )
       Translation adjustment - (3 ) - (1 )
       Benefits paid (33 ) (32 ) (2 ) (3 )
       Benefit obligation at end of year 560 468 78 70
 
Change in plan assets:
       Fair value of assets at beginning of year 275 340 - -
       Actual return on plan assets 39 (68 ) - -
       Employer contributions to qualified and nonqualified plans 53 38 2 3
       Translation adjustment 1 (3 ) - -
Benefits paid (33 ) (32 ) (2 ) (3 )
Fair value of plan assets at end of year 335 275 - -
Funded status — plan assets less than benefit obligation (225 ) (193 ) (78 ) (70 )
 
Accrued benefit cost $ (225 ) $ (193 ) $ (78 ) $ (70 )
 
Amount recognized in the balance sheets consists of:
       Pension benefit assets $ 1 $ 1 $ - $ -
       Current accrued benefit liability     (10 )   (11 ) (5 ) (5 )
       Non-current accrued benefit liability (216 ) (183 )     (73 )     (65 )
       Net amount recognized $ (225 ) $ (193 ) $ (78 ) $ (70 )
 
Information for plans with accumulated benefit obligation in excess of plan assets 
Other
Pension Plans Retirement Plans
        2010         2009         2010         2009
Projected benefit obligation $      478 $      392 $      64 $      62
Accumulated benefit obligation   472   384   64 62
Fair value of plan assets 317   261   - -
Components of the net cost of retirement income and healthcare plans 
Retirement Income Retirement Health Care
      2010       2009       2008       2010       2009       2008
Components of net periodic benefit cost
       Service cost
 $ 9 $ 10 $ 14 $ 2 $ 2 $ 2
       Interest cost 30 29 28 4 4 5
       Expected return on plan assets (31 ) (28 ) (29 ) - - -
       Amortization of unrecognized items 9 6 7 (2 ) (2 ) (1 )
       Total net periodic benefit cost $ 17 $ 17 $ 20 $ 4 $ 4 $ 6
 
Items not recognized as a component of post retirement expense 
Retirement Retirement
        Income         Health Care
Net actuarial loss (gain) $            267 $            (4 )
Prior service cost (benefit)     - (3 )
Net deferred income tax (assets) liabilities (101 )     2
Accumulated other comprehensive loss (income) $ 166   $ (5 )
 
Net actuarial loss (gain) and prior service cost (benefit) activity recorded in accumulated other comprehensive loss (income) 
Retirement Retirement
        Income         Health Care
Net actuarial loss (gain) at beginning of year   $            204 $            (9 )
Amortization during the year   (9 ) 1
Loss during the year 72     4
Net actuarial loss (gain) at end of year $ 267 $ (4 )
Prior service benefit at beginning of year $ - $ (4 )
Amortization during the year -   1  
Prior service benefit at end of year $ - $ (3 )
 
Weighted-average assumptions used to estimate the actuarial present value of benefit obligations 
Retirement Income   Retirement Health Care
      2010       2009       2010       2009
Discount rate   5.34%   6.81%   5.36%   6.80%
Rate of compensation increase 3.99%   4.22%   n/a n/a
Weighted-average assumptions used to estimate the net periodic pension and other postretirement benefit costs 
Retirement Income
      2010       2009       2008
Discount rate 6.81%   6.75%   6.22%
Rate of compensation increase 4.22%   4.19%   4.18%
Expected return on plan assets 8.11%   8.11%   8.15%
 
  Retirement Health Care
2010 2009 2008
Discount rate 6.80%   6.69%   6.19%
Expected benefit payments 
Retirement Retirement
      Income       Health Care
2011   $      32   $      5
2012 33 5
2013 33 6
2014   34 6
2015 35   6
Fiscal years 2016 — 2020 205 31
Target allocations and weighted average asset allocations 
% of Plan Assets
% Target at June 30
      Allocation       2010       2009
Asset Category
U.S. equity 50 % 48 % 50 %
International equity 20 19 21
Fixed income 25 27 24
Other 5 6 5
Total      100 %      100 %      100 %
 
Assets carried at fair value 
      Level 1       Level 2       Total
Mutual funds $ 196 $ - $ 196
Cash equivalents   1 -   1
Common/collective trusts -   138 138
Total assets at fair value $      197 $      138 $      335
 
SEGMENT REPORTING (Tables)
Company's reportable segments' net sales 
Fiscal Total
       Year        Cleaning        Household        Lifestyle        International        Corporate        Company
Net sales 2010 $     1,838 $     1,663 $     864 $     1,169 $     - $     5,534
2009 1,836 1,726   813 1,075   -   5,450
2008 1,817 1,698 676   1,082 - 5,273
 
Earnings (losses) before income taxes 2010 440 290 303 172 (280 ) 925
2009 410 289 270 140 (298 ) 811
2008 360 225 205 177 (274 ) 693
 
Equity in earnings of affiliates 2010 - - - 9 - 9
2009 - - - 8 - 8
2008 - - - 8 - 8
 
Identifiable assets 2010 1,211 788 1,378 907 271 4,555
2009 1,043 724 1,316 895 598 4,576
 
Capital expenditures 2010 52 58 10 27 56 203
2009 75 45 13 25 39 197
2008 55 46 12 17 40 170
 
Depreciation and amortization 2010 53 77 21 22 12 185
2009 54 82 21 21 12 190
2008 58 89 18 28 12 205
 
Significant non-cash charges included in
       earnings before income taxes:
              Asset impairment costs 2010 - - - - - -
2009 - 3 - - - 3
2008 3 22 - 4 - 29
 
              Share-based compensation 2010 16 13 5 2 24 60
2009 14 13 5 2 24 58
2008 13 12 5 2 15 47
Net sales and long-lived assets by geographic area 
Fiscal United Total
       Year        States        Foreign        Company
Net sales 2010 $     4,415 $      1,119 $       5,534
2009   4,422 1,028   5,450
2008 4,239 1,034 5,273
 
Long-lived assets 2010 859 120 979
2009 836 119 955
2008 834 126 960
UNAUDITED QUARTERLY DATA (Tables)
Unaudited quarterly data
Quarters Ended
      September 30       December 31       March 31       June 30       Total Year
Fiscal year ended June 30, 2010    
Net sales $      1,372 $      1,279 $      1,366 $      1,517 $      5,534
 
Cost of products sold $ 753 $ 718 $ 749 $ 837 $ 3,057
 
Net earnings $ 157 $ 110 $ 165 $ 171 $ 603
 
Per common share:
       Net earnings
              Basic $ 1.12 $ 0.78 $ 1.17 $ 1.21 $ 4.28
              Diluted 1.11 0.77 1.16 1.20 4.24
Dividends declared per common share $ 0.50 $ 0.50 $ 0.50 $ 0.55 $ 2.05
Market price (NYSE)
       High $ 61.64 $ 63.10 $ 65.18 $ 65.67 $ 65.67
       Low 55.41 56.36 58.96 60.85 55.41
       Year-end 62.16
 
Fiscal year ended June 30, 2009
Net sales $ 1,384 $ 1,216 $ 1,350 $ 1,500 $ 5,450
 
Cost of products sold $ 822 $ 730 $ 739 $ 813 $ 3,104
 
Net earnings $ 128 $ 86 $ 153 $ 170 $ 537
 
Per common share:
       Net earnings
              Basic $ 0.91 $ 0.62 $ 1.08 $ 1.21 $ 3.82
              Diluted 0.90 0.61 1.08 1.20 3.79
Dividends declared per common share $ 0.46 $ 0.46 $ 0.46 $ 0.50 $ 1.88
Market price (NYSE)
       High $ 65.00 $ 64.00 $ 56.60 $ 57.43 $ 65.00
       Low 47.48 52.05 45.67 50.31 45.67
       Year-end 55.83
VALUATION AND QUALIFYING ACCOUNTS AND RESERVES (Tables)
VALUATION AND QUALIFYING ACCOUNTS AND RESERVES
VALUATION AND QUALIFYING ACCOUNTS AND RESERVES (Dollars in Millions)
 
Column A Column B Column C Column D Column E
Additions Deductions
Balance at Charged to Charged Credited to Credited Balance at
beginning costs and to other costs and to other end
Description       of period       expenses       accounts       expenses       accounts       of period
Allowance for doubtful accounts  
       Year ended June 30, 2010 $        (6 ) $         - $ - $ - $ - $        (6 )
       Year ended June 30, 2009   (7 ) (3 )   - - 4 (6 )
       Year ended June 30, 2008 (5 )   (4 ) -   - 2 (7 )
LIFO allowance
       Year ended June 30, 2010 (31 ) 3 - - - (28 )
       Year ended June 30, 2009 (21 ) (10 ) - - - (31 )
       Year ended June 30, 2008 (18 ) (3 ) - - - (21 )
Valuation allowance on deferred tax assets
       Year ended June 30, 2010 (6 ) (6 ) - - - (12 )
       Year ended June 30, 2009 (7 ) - - 1 - (6 )
       Year ended June 30, 2008 (22 ) - - 15 - (7 )

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details)
Year Ended
Jun. 30,
Jul. 31, 2007
3 Months Ended
Jun. 30, 2010
3 Months Ended
Dec. 31, 2009
3 Months Ended
Jun. 30, 2009
2010
2009
2008
Venezuelan currency remeasurement loss gain
 
 
12,000,000 
 
 
 
 
Cumulative inflation rate, highly inflationary
 
 
 
 
1 
 
 
Gain in other expense (income)
 
 
 
 
2,000,000 
 
 
Net asset position of the Company's Venezuelan subsidiary
 
 
 
 
4,000,000 
 
 
Cash balances included in the net asset position of the Company's Venezuelan subsidiary
 
 
 
 
8,000,000 
 
 
Cash balances denominated in VEFs
 
 
 
 
6,000,000 
 
 
VEFs-denominated monetary net assets and deferred income taxes
 
 
 
 
11,000,000 
 
 
Venezuela's net sales represented in the total Company's net sales
 
 
 
 
0.02 
 
 
Venezuela's total assets represented in the total Company's total assets
 
 
 
 
0.01 
 
 
Basic
 
1.21 
0.78 
1.21 
4.28 
3.82 
3.27 
Diluted
 
1.20 
0.77 
1.20 
4.24 
3.79 
3.23 
Cumulative effect of adopting a consistent recognition threshold and measurement standard
10,000,000 
 
 
 
 
 
 
Income tax liabilities, reclassified from current to non-current
53,000,000 
 
 
 
 
 
 
Non-U.S. dollar balances held by non-U.S. dollar functional currency subsidiaries
 
42,000,000 
 
74,000,000 
42,000,000 
74,000,000 
 
U.S. dollar balances held by non-U.S. dollar functional currency subsidiaries
 
13,000,000 
 
52,000,000 
13,000,000 
52,000,000 
 
Non-U.S. dollar balances held by U.S. dollar functional currency subsidiaries
 
7,000,000 
 
13,000,000 
7,000,000 
13,000,000 
 
U.S. dollar balances including those balances held by U.S. dollar functional currency subsidiaries
 
25,000,000 
 
67,000,000 
25,000,000 
67,000,000 
 
Cash and cash equivalents
 
87,000,000 
 
206,000,000 
87,000,000 
206,000,000 
214,000,000 
Excess tax benefits generated from share-based payment arrangements
 
 
 
 
10,000,000 
6,000,000 
9,000,000 
Maximum rate of the projected benefit obligation
 
 
 
 
0.05 
 
 
Receivables for doubtful accounts, net of tax
 
6,000,000 
 
6,000,000 
6,000,000 
6,000,000 
 
Provision for doubtful accounts
 
 
 
 
0 
3,000,000 
4,000,000 
New packaging development and design costs
 
 
 
 
9,000,000 
8,000,000 
9,000,000 
New packaging development and design costs in cost of products sold
 
 
 
 
8,000,000 
8,000,000 
8,000,000 
 
 
 
 
 
 
 
Basic
 
 
 
 
3.86 
3.82 
3.30 
Diluted
 
 
 
 
3.81 
3.79 
3.24 
Land improvements [Member]
 
 
 
 
 
 
 
Expected Useful Lives, Minimum
 
 
 
 
10 
 
 
Expected Useful Lives, Maximum
 
 
 
 
30 
 
 
Buildings [Member]
 
 
 
 
 
 
 
Expected Useful Lives, Minimum
 
 
 
 
10 
 
 
Expected Useful Lives, Maximum
 
 
 
 
40 
 
 
Machinery and equipment [Member]
 
 
 
 
 
 
 
Expected Useful Lives, Minimum
 
 
 
 
3 
 
 
Expected Useful Lives, Maximum
 
 
 
 
15 
 
 
Computer equipment [Member]
 
 
 
 
 
 
 
Expected Useful Lives, Maximum
 
 
 
 
3 
 
 
Capitalized software costs [Member]
 
 
 
 
 
 
 
Expected Useful Lives, Minimum
 
 
 
 
3 
 
 
Expected Useful Lives, Maximum
 
 
 
 
7 
 
 
Bolivar Fuertes (VEFs) [Member]
 
 
 
 
 
 
 
Foreign currency exchange rate; bolivar fuertes (VEF) to U.S. dollar
 
5.3 
2.15 
 
 
 
 
Parallel market currency exchange rate; bolivar fuertes (VEF) to U.S. dollar
 
 
5.87 
 
 
 
 
BUSINESS ACQUIRED (Details)
In Millions, except Per Share data
Year Ended
Jun. 30,
2010
2010
2010
2010
2009
2008
Nov. 30, 2007
Jun. 30, 2010
Jan. 31, 2010
Aggregate acquisition price
 
 
 
 
 
 
913 
 
24 
Tax benefits paid
 
 
 
 
 
 
25 
 
 
Tax benefits received
 
 
 
 
8 
17 
 
 
 
Cost of acquired entity, transaction costs
 
 
 
 
 
 
8 
 
 
Step-up inventory value
 
 
 
 
 
 
19 
 
 
Percentage of business acquired
 
 
 
 
 
 
1 
 
 
Net sales
 
 
 
5,534 
5,450 
5,343 
 
 
 
Net earnings
 
 
 
603 
537 
472 
 
 
 
Diluted net earnings per common share
 
 
 
4.24 
3.79 
3.32 
 
 
 
Weighted-average estimated useful life of intangible assets subject to amortization
15 
3 
10 
16 
 
 
 
 
 
Cash
 
 
 
33 
 
 
 
 
 
Inventory
 
 
 
45 
 
 
 
2 
 
Other current assets
 
 
 
24 
 
 
 
4 
 
Property, plant and equipment
 
 
 
16 
 
 
 
 
 
Goodwill
 
 
 
613 
 
 
 
9 
 
Intangible assets not subject to amortization - trademarks
 
 
 
322 
 
 
 
6 
 
Customer list
 
 
 
44 
 
 
 
2 
 
Product formulae
 
 
 
8 
 
 
 
2 
 
Other assets
 
 
 
1 
 
 
 
 
 
Total assets acquired
 
 
 
1,106 
 
 
 
 
 
Current liabilities assumed - primarily accounts payable and accrued liabilities
 
 
 
52 
 
 
 
 
 
Other liabilities
 
 
 
3 
 
 
 
1 
 
Current and noncurrent deferred income taxes
 
 
 
138 
 
 
 
 
 
Total liabilities assumed
 
 
 
193 
 
 
 
 
 
Net assets acquired
 
 
 
913 
 
 
 
 
 
RESTRUCTURING AND ASSET IMPAIRMENT (Details)
In Millions
Year Ended
Jun. 30,
2012
2011
2010
2009
2008
Asset impairment costs
 
 
 
3 
29 
Restructuring and asset impairment costs
 
 
4 
20 
36 
Total non-cash costs
 
 
4 
10 
48 
High end of range of estimated restructuring charges
7 
19 
 
 
 
Low end of range of estimated restructuring charges
5 
13 
 
 
 
Portion of 2011 restructuring charges expected to be non-cash
 
6 
 
 
 
Accrual balance
 
 
3 
15 
5 
Restructuring charges
 
 
20 
39 
59 
Cash payments
 
 
(25)
(18)
(5)
Adjustments
 
 
(3)
 
 
Charges against assets
 
 
(4)
(11)
(49)
Cleaning [Member]
 
 
 
 
 
Asset impairment costs
 
 
 
 
3 
Range of estimated restructuring charges in 2011 included in cost of products sold, high end of range
 
6 
 
 
 
Range of estimated restructuring charges in 2011 included in cost of products sold, low end of range
 
4 
 
 
 
Cleaning [Member] | Cost of Goods, Product Line [Member]
 
 
 
 
 
Primarly cost of products sold
 
 
6 
11 
9 
Cleaning [Member] | Employee Severance [Member]
 
 
 
 
 
Severance costs
 
 
2 
3 
3 
Household [Member]
 
 
 
 
 
Asset impairment costs
 
 
 
3 
22 
Range of estimated restructuring charges in 2011 included in cost of products sold, high end of range
 
9 
 
 
 
Range of estimated restructuring charges in 2011 included in cost of products sold, low end of range
 
7 
 
 
 
Household [Member] | Cost of Goods, Product Line [Member]
 
 
 
 
 
Primarly cost of products sold
 
 
4 
5 
10 
Household [Member] | Employee Severance [Member]
 
 
 
 
 
Severance costs
 
 
2 
 
 
International [Member]
 
 
 
 
 
Asset impairment costs
 
 
 
 
4 
International [Member] | Cost of Goods, Product Line [Member]
 
 
 
 
 
Primarly cost of products sold
 
 
 
1 
3 
International [Member] | Employee Severance [Member]
 
 
 
 
 
Severance costs
 
 
 
2 
2 
Corporate [Member]
 
 
 
 
 
Range of estimated restructuring charges in 2011 included in selling and administrative expenses, high end of range
 
4 
 
 
 
Range of estimated restructuring charges in 2011 included in selling and administrative expenses, low end of range
 
2 
 
 
 
Corporate [Member] | Cost of Goods, Product Line [Member]
 
 
 
 
 
Primarly cost of products sold
 
 
3 
2 
1 
Corporate [Member] | Employee Severance [Member]
 
 
 
 
 
Severance costs
 
 
 
12 
2 
Cost of Goods, Product Line [Member]
 
 
 
 
 
Primarly cost of products sold
 
 
13 
19 
23 
Employee Severance [Member]
 
 
 
 
 
Severance costs
 
 
4 
17 
7 
Accrual balance
 
 
3 
15 
5 
Restructuring charges
 
 
7 
17 
7 
Cash payments
 
 
(16)
(7)
(2)
Adjustments
 
 
(3)
 
 
Restructuring Costs Asset Impairments [Member]
 
 
 
 
 
Asset impairment costs
 
 
 
3 
29 
Charges against assets
 
 
 
(3)
(29)
Restructuring Costs Accumulated Depreciation [Member]
 
 
 
 
 
Restructuring charges
 
 
4 
8 
20 
Charges against assets
 
 
(4)
(8)
(20)
Restructuring Costs Other [Member]
 
 
 
 
 
Restructuring costs other
 
 
9 
11 
3 
Cash payments
 
 
(9)
(11)
(3)
INVENTORIES, NET (Details) (USD $)
In Millions
Year Ended
Jun. 30,
2010
2009
2008
Finished Goods
300 
304 
 
Raw materials and packaging
102 
99 
 
Work in process
4 
4 
 
LIFO allowances
(28)
(31)
 
Allowances for obsolescence
(11)
(10)
 
Total
367 
366 
 
Percentage of inventory valued with the LIFO method
0.36 
0.38 
 
Effect on earnings of the liquidation of LIFO layers
3 
 
 
Effect on earnings of the liquidation of LIFO layers, maximum amount
 
1 
1 
Obsolescence provision
$ 11 
$ 12 
$ 12 
OTHER CURRENT ASSETS (Details) (USD $)
In Millions
Jun. 30, 2010
Jun. 30, 2009
Deferred tax assets
$ 73 
$ 74 
Prepaid expenses
40 
42 
Other
13 
6 
Total
$ 126 
$ 122 
PROPERTY, PLANT AND EQUIPMENT, NET (Details) (USD $)
In Millions
Year Ended
Jun. 30,
2010
2009
2008
Machinery and equipment
1,515 
1,431 
 
Buildings
582 
568 
 
Capitalized software costs
302 
289 
 
Construction in progress
166 
146 
 
Land and improvements
127 
127 
 
Computer equipment
92 
93 
 
Subtotal
2,784 
2,654 
 
Less: Accumulated depreciation and amortization
(1,805)
(1,699)
 
Total
979 
955 
960 
Depreciation and amortization expense related to property, plant and equipment
$ 165 
$ 173 
$ 186 
GOODWILL, TRADEMARKS AND OTHER INTANGIBLE ASSETS (Details)
In Millions
Year Ended
Jun. 30,
2015
2014
2013
2012
2011
2010
2009
Balance
 
 
 
 
 
1,650 
1,630 
Acquisitions
 
 
 
 
 
9 
 
Translation adjustments and other
 
 
 
 
 
11 
(28)
Balance
 
 
 
 
 
562 
557 
Acquisitions
 
 
 
 
 
6 
 
Amortization
 
 
 
 
 
(2)
(1)
Translation adjustments and other
 
 
 
 
 
1 
(2)
Other intangible assets, net
 
 
 
 
 
96 
105 
Acquisitions
 
 
 
 
 
4 
 
Amortization
 
 
 
 
 
(14)
(15)
Translation adjustments and other
 
 
 
 
 
1 
(3)
Other intangible assets subject to amortization, net of accumulated amortization
 
 
 
 
 
235 
219 
Future amortization expense 2011
 
 
 
 
16 
 
 
Future amortization expense 2012
 
 
 
15 
 
 
 
Future amortization expense 2013
 
 
14 
 
 
 
 
Future amortization expense 2014
 
13 
 
 
 
 
 
Future amortization expense 2015
10 
 
 
 
 
 
 
Cleaning [Member]
 
 
 
 
 
 
 
Balance
 
 
 
 
 
564 
555 
Acquisitions
 
 
 
 
 
9 
 
Household [Member]
 
 
 
 
 
 
 
Balance
 
 
 
 
 
85 
85 
Lifestyle [Member]
 
 
 
 
 
 
 
Balance
 
 
 
 
 
623 
623 
Translation adjustments and other
 
 
 
 
 
 
1 
International [Member]
 
 
 
 
 
 
 
Balance
 
 
 
 
 
378 
367 
Translation adjustments and other
 
 
 
 
 
11 
(29)
Subject To Amortization [Member]
 
 
 
 
 
 
 
Balance
 
 
 
 
 
24 
14 
Acquisitions
 
 
 
 
 
6 
 
Amortization
 
 
 
 
 
(2)
(1)
Transfers
 
 
 
 
 
5 
14 
Translation adjustments and other
 
 
 
 
 
1 
 
Not Subject To Amortization [Member]
 
 
 
 
 
 
 
Balance
 
 
 
 
 
538 
543 
Transfers
 
 
 
 
 
(5)
(14)
Translation adjustments and other
 
 
 
 
 
 
(2)
Technology And Product Formulae [Member]
 
 
 
 
 
 
 
Other intangible assets, net
 
 
 
 
 
37 
53 
Amortization
 
 
 
 
 
(9)
(10)
Transfers
 
 
 
 
 
(7)
 
Other Amortization [Member]
 
 
 
 
 
 
 
Other intangible assets, net
 
 
 
 
 
59 
52 
Acquisitions
 
 
 
 
 
4 
 
Amortization
 
 
 
 
 
(5)
(5)
Transfers
 
 
 
 
 
7 
 
Translation adjustments and other
 
 
 
 
 
1 
(3)
Trademarks [Member]
 
 
 
 
 
 
 
Weighted-average amortization period
 
 
 
 
 
20 
 
Intangible Assets [Member]
 
 
 
 
 
 
 
Weighted-average amortization period
 
 
 
 
 
14 
 
OTHER ASSETS (Details)
In Millions
Year Ended
Jun. 30,
2010
2009
2008
Jun. 30, 2011
Equity investments
49 
45 
 
 
Investment in insurance contracts
35 
35 
 
 
Deferred tax assets
25 
28 
 
 
Investment in low-income housing partnerships
11 
13 
 
 
Deferred financing costs
10 
10 
 
 
Other
14 
18 
 
 
Total
144 
149 
 
 
Interest in limited partnership
0.99 
 
 
 
Number of low-income housing partnerships
42 
 
 
 
Unrelated third parties partnership interest
0.01 
 
 
 
Tax benefits (detriments), net of equity in the losses of the low-income housing partnerships
2 
1 
(3)
 
Estimated future capital requirement on low-income housing partnerships
 
 
 
1 
Aggregate underlying assets of low-income housing partnerships
292 
 
 
 
Aggregate underlying liabilities of low-income housing partnerships
417 
 
 
 
ACCRUED LIABILITIES (Details) (USD $)
In Millions
Jun. 30, 2010
Jun. 30, 2009
Compensation and employee benefit costs
$ 149 
$ 123 
Trade and sales promotion
109 
86 
Dividends
78 
70 
Interest
40 
49 
Other
116 
144 
Total
$ 492 
$ 472 
DEBT (Details)
In Millions
Year Ended
Jun. 30,
Nov. 30, 2009
2010
2009
2008
Long-term debt repayment
 
598 
 
 
Long-term debt issuance
300 
296 
11 
1,256 
Fixed interest rate
0.0355 
 
 
 
Date notes mature
2015-11-01 
 
 
 
Weighted average interest rate on commercial paper
 
0.0043 
0.0059 
 
Weighted average interest rate on notes and loans payable
 
0.0062 
0.0285 
0.0445 
Current maturities of long-term debt
 
(300)
(577)
 
Long-term debt
 
2,124 
2,151 
 
Weighted average interest rate on long-term debt
 
0.0519 
0.0514 
 
Weighted average interest rates on long-term debt, including the effect of interest rate swaps
 
0.0516 
0.0515 
0.0516 
Estimated fair value of long-term debt, including current maturities
 
2,635 
2,816 
 
Long-term debt maturities, 2011
 
300 
 
 
Long-term debt maturities, 2012
 
3 
 
 
Long-term debt maturities, 2013
 
850 
 
 
Long-term debt maturities, 2014
 
0 
 
 
Long-term debt maturities, 2015
 
575 
 
 
Long-term debt maturities, thereafter
 
700 
 
 
Commercial Paper [Member]
 
 
 
 
Short-term Borrowings
 
369 
419 
 
Foreign Borrowings [Member]
 
 
 
 
Short-term Borrowings
 
2 
2 
 
Short Term Borrowings [Member]
 
 
 
 
Short-term Borrowings
 
371 
421 
 
Senior Unsecured Long-Term Notes And Debentures Instrument; 4.20%, $575 Due January 2010 [Member]
 
 
 
 
Long-term debt
 
 
575 
 
Senior Unsecured Long-Term Notes And Debentures Instrument; 6.125%, $300 Due February 2011 [Member]
 
 
 
 
Long-term debt
 
300 
305 
 
Senior Unsecured Long-Term Notes And Debentures Instrument; 5.45%, $350 Due October 2012 [Member]
 
 
 
 
Long-term debt
 
349 
349 
 
Senior Unsecured Long-Term Notes And Debentures Instrument; 5.00%, $500 Due March 2013 [Member]
 
 
 
 
Long-term debt
 
500 
499 
 
Senior Unsecured Long-Term Notes And Debentures Instrument; 5.00%, $575 Due January 2015 [Member]
 
 
 
 
Long-term debt
 
575 
575 
 
Senior Unsecured Long-Term Notes And Debentures Instrument; 3.55%, $300 Due November 2015 [Member]
 
 
 
 
Long-term debt
 
299 
 
 
Senior Unsecured Long-Term Notes And Debentures Instrument; 5.95%, $400 Due October 2017 [Member]
 
 
 
 
Long-term debt
 
398 
398 
 
Long-Term Foreign Borrowings [Member]
 
 
 
 
Long-term debt
 
3 
27 
 
Combined Long-Term Debt Instruments [Member]
 
 
 
 
Long-term debt
 
2,424 
2,728 
 
Revolving Line Of Credit [Member]
 
 
 
 
Line of credit
 
1,100 
1,100 
 
Foreign Credit Lines [Member]
 
 
 
 
Line of credit
 
23 
57 
 
Other Credit Lines [Member]
 
 
 
 
Line of credit
 
12 
3 
 
Combined Credit Lines [Member]
 
 
 
 
Line of credit
 
1,135 
1,160 
 
Foreign And Other Credit Line [Member]
 
 
 
 
Line of credit
 
35 
 
 
Line of credit facility, remaining borrowing capacity
 
27 
 
 
FINANCIAL INSTRUMENTS AND FAIR VALUE MEASUREMENTS (Details)
In Millions
Year Ended
Jun. 30, 2010
Jun. 30, 2009
Current maturities, months
18 
 
Estimated amount of the existing net loss to be reclassified into earnings, in the next 12 months
0 
 
Changes in the value of derivative instruments after dedesignation
(3)
 
Derivative asset designated as hedging instrument, fair value
1 
6 
Notional value of commodity derivatives
91 
 
Commodity Purchase Contract [Member] | Accrued Liabilities [Member]
 
 
Derivative liability not designated as hedging instrument, fair value
(1)
 
Accrued Liabilities [Member] | Commodity Purchase Contract [Member]
 
 
Derivative liability designated as hedging instrument, fair value
(2)
(21)
Other Current Assets [Member] | Foreign Exchange Contract [Member]
 
 
Derivative asset designated as hedging instrument, fair value
1 
 
Other Current Assets [Member] | Commodity Purchase Contract [Member]
 
 
Derivative asset designated as hedging instrument, fair value
 
6 
Foreign Exchange Contract [Member]
 
 
Loss recognized in OCI
(2)
 
Loss reclassified from OCI and recognized in earnings
(3)
 
Commodity Purchase Contract [Member]
 
 
Loss recognized in OCI
(3)
 
Loss reclassified from OCI and recognized in earnings
(15)
 
Total Cash Flow Hedges [Member]
 
 
Loss recognized in OCI
(5)
 
Loss reclassified from OCI and recognized in earnings
(18)
 
Diesel Fuel Commodity Contract [Member]
 
 
Notional value of commodity derivatives
46 
 
Jet Fuel Commodity Contract [Member]
 
 
Notional value of commodity derivatives
18 
 
Soybean Oil Commodity Contract [Member]
 
 
Notional value of commodity derivatives
25 
 
Crude Oil Commodity Contract [Member]
 
 
Notional value of commodity derivatives
2 
 
Canada [Member]
 
 
Notional value
12 
 
Australia [Member]
 
 
Notional value
6 
 
Fair Value, Inputs, Level 2 [Member]
 
 
Fair value, assets measured on recurring basis
1 
 
Fair value, liabilities measured on recurring basis
3 
 
OTHER LIABILITIES (Details) (USD $)
In Millions
Year Ended
Jun. 30, 2010
Jun. 30, 2009
Employee benefit obligations
$ 306 
$ 266 
Venture agreement net terminal obligation
274 
269 
Taxes
64 
65 
Other
33 
40 
Total
$ 677 
$ 640 
Interest in the joint venture by venture partner
0.2 
 
Agreement term, years
20 
 
Venture agreement renewal option, years
10 
 
OTHER CONTINGENCIES (Details) (USD $)
In Millions
Year Ended
Jun. 30,
2010
2009
Liability for future remediation cost
$ 16 
$ 19 
Percent liable for aggregate remediation and associated costs, other than legal fees
0.243 
0.243 
Remediation period, years
30 
 
Payments made towards remediation efforts, equivalent or less than
$ 1 
$ 1 
STOCKHOLDERS' EQUITY (DEFICIT) (Details)
In Millions, except Per Share data
3 Months Ended
Jun. 30,		 Year Ended
Jun. 30,
Jan. 31, 2008
Aug. 31, 2007
2010
2009
2010
2009
2008
Shares received from ASR
1 
11 
 
 
 
 
 
Average per share amount under ASR agreement
 
 
 
 
 
 
62.08 
Aggregate price under ASR agreement
 
 
 
 
 
 
750 
Dividends declared per share
 
 
0.55 
0.50 
2.05 
1.88 
1.66 
Paid dividends per share
 
 
 
 
2 
1.84 
1.60 
Currency translation
 
 
(211)
(220)
(211)
(220)
(142)
Derivatives
 
 
1 
(9)
1 
(9)
30 
Pension and postretirement benefit adjustments
 
 
(161)
(118)
(161)
(118)
(67)
Total
 
 
(371)
(347)
(371)
(347)
(179)
Open-market Program [Member]
 
 
 
 
 
 
 
Common share repurchase program authorized spending limit
 
 
 
 
750 
750 
750 
Stock repurchased, value
 
 
 
 
 
0 
 
Stock repurchased, shares
 
 
 
 
 
0 
 
Evergreen Program [Member]
 
 
 
 
 
 
 
Common share repurchase program authorized spending limit
 
 
 
 
 
no authorization limit 
no authorization limit 
Stock repurchased, value
 
 
 
 
150 
0 
118 
Stock repurchased, shares
 
 
 
 
2 
0 
2 
EARNINGS PER SHARE (Details) (USD $)
In Millions, except Share data in Thousands
Year Ended
Jun. 30,
2010
2009
2008
Net earnings
$ 603 
$ 537 
$ 461 
Less: Earnings allocated to participating securities
3 
5 
5 
Net earnings applicable to common stock
$ 600 
$ 532 
$ 456 
Basic
140,272 
139,015 
139,633 
Dilutive effect of stock options and other (excludes participating securities)
1,262 
1,154 
1,564 
Diluted
141,534 
140,169 
141,197 
Stock options
3,978 
5,090 
2,719 
SHARE-BASED COMPENSATION PLANS (Details)
In Millions, except Share data
Year Ended
Jun. 30,		 Year Ended
Jun. 30,
2010
2009
2008
Nov. 30, 2005
2010
2009
2008
2010
2009
2008
Share-based compensation plans, shares authorized to grant
 
 
 
7,000,000 
 
 
 
 
 
 
Share based compensation plans, shares available for grant
6,000,000 
 
 
 
 
 
 
 
 
 
Proceeds from issuance of preferred stock and preference stock
69 
35 
31 
 
 
 
 
 
 
 
Weighted average grant date fair value of options or awards granted
8.34 
11.07 
11.86 
 
57.28 
63.95 
61.16 
58.91 
63.30 
60.69 
Total intrinsic value of options exercised
36 
16 
16 
 
 
 
 
 
 
 
Compensation cost related to nonvested options
19 
 
 
 
31 
 
 
2 
 
 
Total fair value of the shares vested
 
 
 
 
33 
26 
4 
5 
8 
10 
Nonvested units outstanding
 
 
 
 
1,298,382 
1,252,134 
 
 
 
 
Nonvested units outstanding weighted average grant date fair value, per share
 
 
 
 
60.68 
62.28 
 
 
 
 
Total shares vested
 
 
 
 
533,581 
 
 
 
 
 
Total shares vested weighted average grant date fair value per share
 
 
 
 
61.51 
 
 
 
 
 
Vested awards were paid by the issuance of shares
 
 
 
 
29 
22 
 
 
 
 
Vested stock awards deferred
 
 
 
 
4 
4 
 
 
 
 
Deferred stock units for nonemployee directors granted
23,528 
 
 
 
 
 
 
 
 
 
Deferred stock units for nonemployee directors reinvested dividends
5,290 
 
 
 
 
 
 
 
 
 
Deferred stock units for nonemployee directors distributed
1,990 
 
 
 
 
 
 
 
 
 
Deferred stock units for nonemployee directors granted weighted-average fair value on grant date
61.11 
 
 
 
 
 
 
 
 
 
Deferred stock units for nonemployee directors reinvested weighted-average fair value on grant date
61.89 
 
 
 
 
 
 
 
 
 
Deferred stock units for nonemployee directors distributed weighted-average fair value on grant date
52.06 
 
 
 
 
 
 
 
 
 
Deferred stock units for nonemployee directors outstanding
179,826 
 
 
 
 
 
 
 
 
 
Deferred stock units for nonemployee directors outstanding weighted-average fair value on grant date
56.66 
 
 
 
 
 
 
 
 
 
SHARE-BASED COMPENSATION PLANS - Compensation cost and related income tax benefit (Detail) (USD $)
In Millions
Year Ended
Jun. 30,
2010
2009
2008
Total compensation cost
$ 60 
$ 58 
$ 47 
Related income tax benefit
22 
22 
18 
Cost Of Products Sold [Member]
 
 
 
Total compensation cost
8 
8 
7 
Selling And Administrative Expense [Member]
 
 
 
Total compensation cost
46 
45 
36 
Research and development costs [Member]
 
 
 
Total compensation cost
$ 6 
$ 5 
$ 4 
SHARE-BASED COMPENSATION PLANS - Assumptions Utilized in the Valuation in Calculating the Compensation Expense for Stock Options Granted (Detail)
Year Ended
Jun. 30,
2010
2009
2008
Expected life
5 
5 
5 
Expected volatility
 
0.234 
 
Weighted-average volatility
0.22 
0.234 
0.216 
Risk-free interest rate
 
0.026 
 
Dividend yield
 
0.03 
 
Weighted-average dividend yield
0.036 
0.03 
0.027 
Upper limit [Member]
 
 
 
Expected volatility
0.229 
 
0.222 
Risk-free interest rate
0.024 
 
0.042 
Dividend yield
0.036 
 
0.03 
Lower limit [Member]
 
 
 
Expected volatility
0.216 
 
0.21 
Risk-free interest rate
0.022 
 
0.028 
Dividend yield
0.034 
 
0.027 
SHARE-BASED COMPENSATION PLANS - Summary of Options Outstanding Under the Plans and Activity During the Year (Detail) (USD $)
Share data in Thousands, except Per Share data, unless otherwise specified
Year Ended
Jun. 30,
2010
2009
Number of shares outstanding
10,011,000 
10,089,000 
Number of shares granted
1,924,000 
 
Number of shares exercised
(1,701,000)
 
Number of shares cancelled
(301,000)
 
Options vested and exercisable
6,087,000 
 
Weighted average exercise price outstanding
$ 55 
$ 53 
Weighted average exercise price granted
57 
 
Weighted average exercise price exercised
41 
 
Weighted average exercise price cancelled
60 
 
Weighted average exercise price vested and exercisable
52 
 
Average remaining contractual life outstanding, years
6 
6 
Average remaining contractual life exercisable, years
4 
 
Aggregate intrinsic value outstanding
$ 68 
$ 32 
Aggregate intrinsic value exercisable
61 
 
SHARE-BASED COMPENSATION PLANS - Summary of Status of Restricted and Performance Stock Awards (Detail) (USD $)
In Thousands, except Per Share data
Year Ended
Jun. 30, 2010
Jun. 30, 2009
Performance Units [Member]
 
 
Number of shares outstanding, stock awards
1,551 
1,449 
Number of shares granted, stock awards
670 
 
Number of shares vested, stock awards
(485)
 
Number of shares forfeited, stock awards
(83)
 
Number of shares vested and deferred, performance stock awards
252 
 
Weighted-average grant date fair value per share outstanding
$ 59 
$ 60 
Weighted-average grant date fair value per share granted
58 
 
Weighted-average grant date fair value per share vested
61 
 
Weighted-average grant date fair value per share forfeited
61 
 
Weighted-average grant date fair value per share vested and deferred, performance stock
53 
 
Restricted Stock [Member]
 
 
Number of shares outstanding, stock awards
112 
196 
Number of shares granted, stock awards
5 
 
Number of shares vested, stock awards
(83)
 
Number of shares forfeited, stock awards
(6)
 
Weighted-average grant date fair value per share outstanding
$ 62 
$ 62 
Weighted-average grant date fair value per share granted
59 
 
Weighted-average grant date fair value per share vested
61 
 
Weighted-average grant date fair value per share forfeited
62 
 
LEASES AND OTHER COMMITMENTS (Details)
In Millions
Year Ended
Jun. 30,
2010
2009
2008
2011
32 
 
 
2012
35 
 
 
2013
31 
 
 
2014
26 
 
 
2015
21 
 
 
Thereafter
81 
 
 
Total
226 
 
 
Rent expense for all operating leases
59 
62 
59 
Future minimum rentals
5 
 
 
Highest annual amount of future minimum rentals
2 
 
 
Purchase obligation 2011
361 
 
 
Purchase obligation 2012
145 
 
 
Purchase obligation 2013
58 
 
 
Purchase obligation 2014
19 
 
 
Purchase obligation 2015
3 
 
 
Purchase obligation thereafter
2 
 
 
OTHER EXPENSE (INCOME), NET (Details) (USD $)
In Millions
Year Ended
Jun. 30,
2010
2009
2008
Foreign exchange transaction losses, net
$ 26 
$ 28 
$ 2 
Amortization of trademarks and other intangible assets
9 
7 
7 
Low-income housing partnership losses (Note 8)
1 
3 
7 
Equity in earnings of unconsolidated affiliates
(9)
(8)
(8)
Interest income
(3)
(4)
(12)
Other
1 
 
(5)
Total other expense (income), net
$ 25 
$ 26 
$ (9)
Remeasurement Losses By Venezuelan Subsidiary [Member]
 
 
 
Share of transaction gains/losses
0.9 
 
 
Conversion Of Local Currency Transactions To U.S. Dollars [Member]
 
 
 
Share of transaction gains/losses
0.7 
 
 
INCOME TAXES (Details)
In Millions
Year Ended
Jun. 30,
2010
2009
2008
Sep. 30, 2009
Dec. 31, 2008
Federal
227 
194 
203 
 
 
State
29 
40 
28 
 
 
Foreign
42 
41 
52 
 
 
Total current
298 
275 
283 
 
 
Federal
18 
2 
(36)
 
 
State
2 
3 
(3)
 
 
Foreign
4 
(6)
(12)
 
 
Total deferred
24 
(1)
(51)
 
 
Total
322 
274 
232 
 
 
United States
773 
669 
538 
 
 
Foreign
152 
142 
155 
 
 
Total
925 
811 
693 
 
 
Statutory federal tax rate
0.35 
0.35 
0.35 
 
 
State taxes (net of federal tax benefits)
0.022 
0.034 
0.025 
 
 
Tax differential on foreign earnings
(0.01)
(0.018)
0.001 
 
 
Net adjustment of prior year federal and state tax accruals
(0.004)
(0.02)
0.01 
 
 
Change in valuation allowance
0.006 
0.001 
(0.023)
 
 
Domestic manufacturing deduction
(0.017)
(0.018)
(0.017)
 
 
Other differences
0.001 
0.009 
(0.01)
 
 
Effective tax rate
0.348 
0.338 
0.336 
 
 
Undistributed earnings of certain foreign subsidiaries
102 
 
 
 
 
Federal income tax liability
26 
 
 
 
 
Realized and recorded excess tax benefits
10 
6 
9 
 
 
Compensation and benefit programs
201 
177 
 
 
 
Basis difference related to Venture Agreement
30 
30 
 
 
 
Accruals and reserves
25 
30 
 
 
 
Inventory costs
13 
16 
 
 
 
Other
63 
60 
 
 
 
Subtotal
332 
313 
 
 
 
Deferred tax assets, valuation allowance
(12)
(6)
 
 
 
Total deferred tax assets
320 
307 
 
 
 
Fixed and intangible assets
(188)
(176)
 
 
 
Low-income housing partnerships
(28)
(27)
 
 
 
Other
(30)
(25)
 
 
 
Total deferred tax liabilities
(246)
(228)
 
 
 
Net deferred tax assets (liabilities)
74 
79 
 
 
 
Current deferred tax assets
73 
74 
 
 
 
Noncurrent deferred tax assets
25 
28 
 
 
 
Noncurrent deferred tax liabilities
(24)
(23)
 
 
 
Valuation allowance
(12)
(6)
(7)
 
 
Net increase (decrease) in realizability of foreign deferred tax asset
(5)
1 
 
 
 
Increase in foreign net operating loss carryforward and other
(1)
 
 
 
 
Federal interest and taxes
 
 
 
8 
2 
Accrued interest and penalties related to uncertain tax positions
22 
17 
 
 
 
Interest and penalties of income tax expense
5 
 
 
 
 
Unrecognized tax benefits
84 
98 
 
 
 
Gross increases - tax positions in prior periods
10 
 
 
 
 
Gross decreases - tax positions in prior periods
(15)
 
 
 
 
Gross increases - current period tax positions
5 
 
 
 
 
Settlements
(14)
 
 
 
 
If realized, the total amount of unrecognized tax benefits that would affect the effective tax rate
57 
64 
 
 
 
Potential reduction in unrecognized tax benefits
Text Block 
 
 
 
 
Expiration Dates Between Fiscal Years 2011 And 2029 [Member]
 
 
 
 
 
Foreign tax credit carryforwards
6 
 
 
 
 
Indefinitely [Member]
 
 
 
 
 
Foreign tax credit carryforwards
3 
 
 
 
 
Potential reduction in unrecognized tax benefits 
29
EMPLOYEE BENEFIT PLANS (Details)
In Millions
Year Ended
Jun. 30,
2010
2009
2008
Jun. 30, 2011
Accumulated post-retirement cost trend for medical
0.084 
 
 
 
Accumulated post-retirement cost trend for prescription drugs
0.098 
 
 
 
Assumed ultimate trend
0.045 
 
 
 
Ultimate trend, year reached
2028 
 
 
 
Basis point increase
100 
 
 
 
Effect of basis point change on benefit obligation, equivalent or less than
1 
1 
1 
 
Fair value of assets
335 
 
 
 
Employer contributions to qualified and nonqualified plans
8 
7 
13 
 
Accumulated benefit obligation
490 
398 
390 
 
Increase in accumulated benefit obligation for all retirement plans
97 
 
 
 
Net deferred income tax (assets) liabilities
74 
79 
 
 
Accumulated other comprehensive loss (income)
161 
118 
67 
 
Recognized service benefit, on pretax basis
 
 
 
1 
Net actuarial loss as a component of net periodic benefit cost
 
 
 
12 
Mutual funds
196 
 
 
 
Cash equivalents
1 
 
 
 
Common/Collective trusts
138 
 
 
 
Total assets at fair value
335 
 
 
 
Discretionary company contributions, above and beyond
0.03 
 
 
 
Net Periodic Costs [Member] | Retirement Income [Member]
 
 
 
 
Discount rate weighted average
0.0681 
0.0675 
0.0622 
 
Rate of compensation increase weighted average
0.0422 
0.0419 
0.0418 
 
Expected return on plan assets weighted average
0.0811 
0.0811 
0.0815 
 
Net Periodic Costs [Member] | Retirement Health Care [Member]
 
 
 
 
Discount rate weighted average
0.068 
0.0669 
0.0619 
 
Benefit Obligation [Member] | Retirement Income [Member]
 
 
 
 
Discount rate weighted average
0.0534 
0.0681 
 
 
Rate of compensation increase weighted average
0.0399 
0.0422 
 
 
Benefit Obligation [Member] | Retirement Health Care [Member]
 
 
 
 
Discount rate weighted average
0.0536 
0.068 
 
 
Domestic Equity Securities [Member]
 
 
 
 
% of Plan Assets
0.48 
0.5 
 
 
% Target Allocation
0.5 
 
 
 
Foreign Equity Securities [Member]
 
 
 
 
% of Plan Assets
0.19 
0.21 
 
 
% Target Allocation
0.2 
 
 
 
Fixed Income [Member]
 
 
 
 
% of Plan Assets
0.27 
0.24 
 
 
% Target Allocation
0.25 
 
 
 
Other [Member]
 
 
 
 
% of Plan Assets
0.06 
0.05 
 
 
% Target Allocation
0.05 
 
 
 
Total [Member]
 
 
 
 
% of Plan Assets
1 
1 
 
 
% Target Allocation
1 
 
 
 
Fair Value, Inputs, Level 1 [Member]
 
 
 
 
Fair value of assets
197 
 
 
 
Mutual funds
196 
 
 
 
Cash equivalents
1 
 
 
 
Total assets at fair value
197 
 
 
 
Fair Value, Inputs, Level 2 [Member]
 
 
 
 
Fair value of assets
138 
 
 
 
Common/Collective trusts
138 
 
 
 
Total assets at fair value
138 
 
 
 
United States Employees [Member]
 
 
 
 
Aggregate cost of the defined contribution plans
33 
24 
30 
 
Profit sharing contributions
29 
19 
26 
 
International Employees [Member]
 
 
 
 
Aggregate cost of the defined contribution plans
3 
2 
3 
 
Foreign Retirement Income Plans [Member]
 
 
 
 
Employer contributions to qualified and nonqualified plans
2 
1 
1 
 
Domestic Qualified Retirement Income Plans [Member]
 
 
 
 
Employer contributions to qualified and nonqualified plans
43 
30 
0 
 
Retirement Income [Member]
 
 
 
 
Benefit obligation
560 
468 
465 
 
Service cost
9 
10 
14 
 
Interest cost
30 
29 
28 
 
Employee contributions to deferred compensation plans
6 
7 
 
 
Actuarial loss/(gain)
80 
(8)
 
 
Translation adjustment
 
(3)
 
 
Benefits paid
(33)
(32)
 
 
Fair value of assets
335 
275 
340 
 
Actual return on plan assets
39 
(68)
 
 
Employer contributions to qualified and nonqualified plans
53 
38 
 
 
Translation adjustment
1 
(3)
 
 
Funded status - plan assets less than benefit obligation
(225)
(193)
 
 
Accrued benefit cost
(225)
(193)
 
 
Pension benefit assets
1 
1 
 
 
Current accrued benefit liability
(10)
(11)
 
 
Non-current accrued benefit liability
(216)
(183)
 
 
Expected return on plan assets
(31)
(28)
(29)
 
Amortization of unrecognized items
9 
6 
7 
 
Total net periodic benefit cost
17 
17 
20 
 
Net actuarial loss (gain)
267 
 
 
 
Net deferred income tax (assets) liabilities
(101)
 
 
 
Accumulated other comprehensive loss (income)
166 
 
 
 
Net actuarial loss (gain)
267 
204 
 
 
Amortization of loss
(9)
 
 
 
Loss (gain) during the year
72 
 
 
 
2011
32 
 
 
 
2012
33 
 
 
 
2013
33 
 
 
 
2014
34 
 
 
 
2015
35 
 
 
 
Fiscal years 2016 - 2020
205 
 
 
 
Total assets at fair value
335 
275 
340 
 
Retirement Health Care [Member]
 
 
 
 
Benefit obligation
78 
70 
71 
 
Service cost
2 
2 
2 
 
Interest cost
4 
4 
5 
 
Actuarial loss/(gain)
4 
(3)
 
 
Translation adjustment
 
(1)
 
 
Benefits paid
(2)
(3)
 
 
Employer contributions to qualified and nonqualified plans
2 
3 
 
 
Funded status - plan assets less than benefit obligation
(78)
(70)
 
 
Accrued benefit cost
(78)
(70)
 
 
Current accrued benefit liability
(5)
(5)
 
 
Non-current accrued benefit liability
(73)
(65)
 
 
Amortization of unrecognized items
(2)
(2)
(1)
 
Total net periodic benefit cost
4 
4 
6 
 
Net actuarial loss (gain)
(4)
 
 
 
Prior service cost (benefit)
(3)
 
 
 
Net deferred income tax (assets) liabilities
2 
 
 
 
Accumulated other comprehensive loss (income)
(5)
 
 
 
Net actuarial loss (gain)
(4)
(9)
 
 
Amortization of loss
1 
 
 
 
Loss (gain) during the year
4 
 
 
 
Prior service benefit
(3)
(4)
 
 
Amortization during the year
1 
 
 
 
2011
5 
 
 
 
2012
5 
 
 
 
2013
6 
 
 
 
2014
6 
 
 
 
2015
6 
 
 
 
Fiscal years 2016 - 2020
31 
 
 
 
Pension Plans, Defined Benefit [Member]
 
 
 
 
Projected benefit obligation
478 
392 
 
 
Accumulated benefit obligation
472 
384 
 
 
Fair value of plan assets
317 
261 
 
 
Other Postretirement Benefit Plans, Defined Benefit [Member]
 
 
 
 
Projected benefit obligation
64 
62 
 
 
Accumulated benefit obligation
64 
62 
 
 
SEGMENT REPORTING (Details)
In Millions
3 Months Ended
Jun. 30,		 Year Ended
Jun. 30,
2010
2009
2010
2009
2008
Asset impairment costs
 
 
 
3 
29 
Share-based compensation
 
 
60 
58 
47 
Number of product lines that have accounted for ten percent or more of consolidated net sales
 
 
3 
3 
3 
Percentage of net sales to Wal-Mart, Inc. and its affiliates
 
 
0.27 
0.27 
0.26 
Percentage of net sales accounted for by the five largest customers
 
 
0.45 
0.43 
0.42 
Sales of liquid bleach as a percentage of net sales
 
 
0.13 
0.13 
0.14 
Sales of trash bags as a percentage of net sales
 
 
0.11 
0.12 
0.13 
Sales of charcoal as a percentage of net sales
 
 
0.11 
0.1 
0.1 
Net sales in United States
 
 
4,415 
4,422 
4,239 
Net sales in foreign countries
 
 
1,119 
1,028 
1,034 
Total company net sales
1,517 
1,500 
5,534 
5,450 
5,273 
Long-lived assets in United States
859 
836 
859 
836 
834 
Long-lived assets in foreign countries
120 
119 
120 
119 
126 
Total
979 
955 
979 
955 
960 
Cleaning [Member]
 
 
 
 
 
Net sales
 
 
1,838 
1,836 
1,817 
Earnings (losses) before income taxes
 
 
440 
410 
360 
Identifiable assets
 
 
1,211 
1,043 
 
Capital expenditures
 
 
52 
75 
55 
Depreciation and amortization
 
 
53 
54 
58 
Asset impairment costs
 
 
 
 
3 
Share-based compensation
 
 
16 
14 
13 
Sales of liquid bleach as a percentage of net sales
 
 
0.25 
0.25 
0.25 
Household [Member]
 
 
 
 
 
Net sales
 
 
1,663 
1,726 
1,698 
Earnings (losses) before income taxes
 
 
290 
289 
225 
Identifiable assets
 
 
788 
724 
 
Capital expenditures
 
 
58 
45 
46 
Depreciation and amortization
 
 
77 
82 
89 
Asset impairment costs
 
 
 
3 
22 
Share-based compensation
 
 
13 
13 
12 
Sales of trash bags as a percentage of net sales
 
 
0.31 
0.33 
0.34 
Sales of charcoal as a percentage of net sales
 
 
0.36 
0.32 
0.3 
Lifestyle [Member]
 
 
 
 
 
Net sales
 
 
864 
813 
676 
Earnings (losses) before income taxes
 
 
303 
270 
205 
Identifiable assets
 
 
1,378 
1,316 
 
Capital expenditures
 
 
10 
13 
12 
Depreciation and amortization
 
 
21 
21 
18 
Share-based compensation
 
 
5 
5 
5 
International [Member]
 
 
 
 
 
Net sales
 
 
1,169 
1,075 
1,082 
Earnings (losses) before income taxes
 
 
172 
140 
177 
Equity in earnings of affiliates
 
 
9 
8 
8 
Identifiable assets
 
 
907 
895 
 
Capital expenditures
 
 
27 
25 
17 
Depreciation and amortization
 
 
22 
21 
28 
Asset impairment costs
 
 
 
 
4 
Share-based compensation
 
 
2 
2 
2 
Sales of liquid bleach as a percentage of net sales
 
 
0.21 
0.25 
0.23 
Sales of trash bags as a percentage of net sales
 
 
0.1 
0.1 
0.11 
Corporate [Member]
 
 
 
 
 
Earnings (losses) before income taxes
 
 
(280)
(298)
(274)
Identifiable assets
 
 
271 
598 
 
Capital expenditures
 
 
56 
39 
40 
Depreciation and amortization
 
 
12 
12 
12 
Share-based compensation
 
 
24 
24 
15 
Total Company [Member]
 
 
 
 
 
Net sales
 
 
5,534 
5,450 
5,273 
Earnings (losses) before income taxes
 
 
925 
811 
693 
Equity in earnings of affiliates
 
 
9 
8 
8 
Identifiable assets
 
 
4,555 
4,576 
 
Capital expenditures
 
 
203 
197 
170 
Depreciation and amortization
 
 
185 
190 
205 
Asset impairment costs
 
 
 
3 
29 
Share-based compensation
 
 
60 
58 
47 
GUARANTEES (Details) (USD $)
In Millions
Jun. 30, 2010
Maximum indemnification agreement exposure
$ 28 
Letters of credit
$ 19 
UNAUDITED QUARTERLY DATA (Details) (USD $)
Year Ended
Jun. 30,
3 Months Ended
Jun. 30, 2010
3 Months Ended
Mar. 31, 2010
3 Months Ended
Dec. 31, 2009
3 Months Ended
Sep. 30, 2009
3 Months Ended
Jun. 30, 2009
3 Months Ended
Mar. 31, 2009
3 Months Ended
Dec. 31, 2008
3 Months Ended
Sep. 30, 2008
2010
2009
Net sales
$ 1,517,000,000 
$ 1,366,000,000 
$ 1,279,000,000 
$ 1,372,000,000 
$ 1,500,000,000 
$ 1,350,000,000 
$ 1,216,000,000 
$ 1,384,000,000 
$ 5,534,000,000 
$ 5,450,000,000 
Cost of products sold
837,000,000 
749,000,000 
718,000,000 
753,000,000 
813,000,000 
739,000,000 
730,000,000 
822,000,000 
3,057,000,000 
3,104,000,000 
Net earnings
171,000,000 
165,000,000 
110,000,000 
157,000,000 
170,000,000 
153,000,000 
86,000,000 
128,000,000 
603,000,000 
537,000,000 
Basic
1.21 
1.17 
0.78 
1.12 
1.21 
1.08 
0.62 
0.91 
4.28 
3.82 
Diluted
1.20 
1.16 
0.77 
1.11 
1.20 
1.08 
0.61 
0.90 
4.24 
3.79 
Dividends declared per share
$ 0.55 
$ 0.50 
$ 0.50 
$ 0.50 
$ 0.50 
$ 0.46 
$ 0.46 
$ 0.46 
$ 2.05 
$ 1.88 
High
65.67 
65.18 
63.10 
61.64 
57.43 
56.60 
64 
65 
65.67 
65 
Low
60.85 
58.96 
56.36 
55.41 
50.31 
45.67 
52.05 
47.48 
55.41 
45.67 
Year-end
62.16 
 
 
 
55.83 
 
 
 
62.16 
55.83 
VALUATION AND QUALIFYING ACCOUNTS AND RESERVES (Details) (USD $)
In Millions
Year Ended
Jun. 30,		 Year Ended
Jun. 30,		 Year Ended
Jun. 30,
2009
2008
Jun. 30, 2010
Jun. 30, 2009
2010
2009
2008
Jun. 30, 2010
2010
2009
2008
Jun. 30, 2010
Valuation and allowances balance
$ (7)
$ (5)
$ (6)
$ (6)
$ (31)
$ (21)
$ (18)
$ (28)
$ (6)
$ (7)
$ (22)
$ (12)
Valuation allowances and reserves charged to costs and expenses
(3)
(4)
 
 
3 
(10)
(3)
 
(6)
 
 
 
Valuation allowances and reserves credited to costs and expenses
 
 
 
 
 
 
 
 
 
1 
15 
 
Valuation allowances and reserves credited to other accounts
4 
2