The Procter & Gamble Company (PG) 8-K 29 Jan 10 Other Events Financial data

Statement Of Income Alternative

Statement Of Income Alternative (USD $)
In Millions, except Per Share data	12 Months Ended Jun. 30, 2009	12 Months Ended Jun. 30, 2008	12 Months Ended Jun. 30, 2007
NET SALES	$76,694	$79,257	$72,441
Cost of products sold	38,690	39,261	35,376
Selling, general and administrative expense	22,630	24,017	22,580
OPERATING INCOME	15,374	15,979	14,485
Interest expense	1,358	1,467	1,304
Other non-operating income, net	397	373	481
EARNINGS FROM CONTINUING OPERATIONS BEFORE INCOME TAXES	14,413	14,885	13,662
Income taxes on continuing operations	3,733	3,594	4,000
NET EARNINGS FROM CONTINUING OPERATIONS	10,680	11,291	9,662
NET EARNINGS FROM DISCONTINUED OPERATIONS	2,756	784	678
NET EARNINGS	$13,436	$12,075	$10,340
BASIC NET EARNINGS PER COMMON SHARE:
Earnings from continuing operations	3.55	3.61	3.01
Earnings from discontinued operations	0.94	0.25	0.21
BASIC NET EARNINGS PER COMMON SHARE	4.49	3.86	3.22
DILUTED NET EARNINGS PER COMMON SHARE:
Earnings from continuing operations	3.39	3.4	2.84
Earnings from discontinued operations	0.87	0.24	0.2
DILUTED NET EARNINGS PER COMMON SHARE	4.26	3.64	3.04
DIVIDENDS PER COMMON SHARE	1.64	1.45	1.28

Statement Of Financial Position

Statement Of Financial Position Classified (USD $)
In Millions	Jun. 30, 2009	Jun. 30, 2008
CURRENT ASSETS
Cash and cash equivalents	$4,781	$3,313
Accounts receivable	5,836	6,761
Inventories
Materials and supplies	1,557	2,262
Work in process	672	765
Finished goods	4,651	5,389
Total inventories	6,880	8,416
Deferred income taxes	1,209	2,012
Prepaid expenses and other current assets	3,199	4,013
TOTAL CURRENT ASSETS	21,905	24,515
PROPERTY, PLANT AND EQUIPMENT
Buildings	6,724	7,052
Machinery and equipment	29,042	30,145
Land	885	889
Total property, plant and equipment	36,651	38,086
Accumulated depreciation	(17,189)	(17,446)
NET PROPERTY, PLANT AND EQUIPMENT	19,462	20,640
GOODWILL AND OTHER INTANGIBLE ASSETS
Goodwill	56,512	59,767
Trademarks and other intangible assets, net	32,606	34,233
NET GOODWILL AND OTHER INTANGIBLE ASSETS	89,118	94,000
OTHER NONCURRENT ASSETS	4,348	4,837
TOTAL ASSETS	134,833	143,992
CURRENT LIABILITIES
Accounts payable	5,980	6,775
Accrued and other liabilities	8,601	11,099
Debt due within one year	16,320	13,084
TOTAL CURRENT LIABILITIES	30,901	30,958
LONG-TERM DEBT	20,652	23,581
DEFERRED INCOME TAXES	10,752	11,805
OTHER NONCURRENT LIABILITIES	9,146	7,864
TOTAL LIABILITIES	71,451	74,208
SHAREHOLDERS' EQUITY
Common stock, stated value $1 per share (10,000 shares authorized; shares issued: 2009 - 4,007.3, 2008 - 4,001.8)	4,007	4,002
Additional paid-in capital	61,118	60,307
Reserve for ESOP debt retirement	(1,340)	(1,325)
Accumulated other comprehensive income (loss)	(3,358)	3,746
Treasury stock, at cost (shares held: 2009 - 1,090.3, 2008 - 969.1)	(55,961)	(47,588)
Retained earnings	57,309	48,986
Noncontrolling interest	283	290
TOTAL SHAREHOLDERS' EQUITY	63,382	69,784
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY	134,833	143,992
Convertible Class A preferred stock
SHAREHOLDERS' EQUITY
Preferred stock value	1,324	1,366
Non-Voting Class B preferred stock
SHAREHOLDERS' EQUITY
Preferred stock value	$0	$0

1_Statement Of Financial Positi

Statement Of Financial Position Classified (Parenthetical) (USD $)
Share data in Millions, except Per Share data	Jun. 30, 2009	Jun. 30, 2008
Common stock, stated value	$1	$1
Common stock, shares authorized	10,000	10,000
Common stock, shares issued	4007.3	4001.8
Treasury stock, shares	1090.3	969.1
Convertible Class A preferred stock
Preferred stock, stated value	$1	$1
Preferred stock, shares authorized	600	600
Non-Voting Class B preferred stock
Preferred stock, stated value	$1	$1
Preferred stock, shares authorized	200	200

Statement Of Shareholders Equit

Statement Of Shareholders Equity And Other Comprehensive Income (USD $)
In Millions, except Share data in Thousands	Common Stock	Preferred Stock	Additional Paid-In Capital	Reserve for ESOP Debt Retirement [Member]	Accumulated Other Comprehensive Income		Noncontrolling Interest	Treasury Stock	Retained Earnings		Total
BEGINNING BALANCE at Jun. 30, 2006	$3,976	$1,451	$57,856	($1,288)	($518)		$263	($34,235)	$35,666		$63,171
BEGINNING BALANCE at Jun. 30, 2006	3,178,841
Net earnings									10,340		10,340
Other comprehensive income:
Financial statement translation					2,419						2,419
Hedges and investment securities, net of $452 in 2009, $1,664 in 2008 and $459 in 2007 tax					(951)						(951)
Cumulative impact for adoption of new accounting guidance					(333)	[1]					(333)	[1]
Dividends to shareholders:
Common									(4,048)		(4,048)
Preferred, net of tax benefits									(161)		(161)
Treasury purchases	(89,829)
Treasury purchases								(5,578)			(5,578)
Employee plan issuances	37,824
Employee plan issuances	14		1,167					1,003			2,184
Preferred stock conversions	5,110
Preferred stock conversions		(45)	7					38			0
ESOP debt impacts				(20)							(20)
Noncontrolling interest							(11)				(11)
ENDING BALANCE at Jun. 30, 2007	3,131,946
ENDING BALANCE at Jun. 30, 2007	3,990	1,406	59,030	(1,308)	617		252	(38,772)	41,797		67,012
Net earnings									12,075		12,075
Other comprehensive income:
Financial statement translation					6,543						6,543
Hedges and investment securities, net of $452 in 2009, $1,664 in 2008 and $459 in 2007 tax					(2,906)						(2,906)
Defined benefit retirement plans, net of $879 in 2009 and $120 in 2008 tax					(508)						(508)
Cumulative impact for adoption of new accounting guidance									(232)	[1]	(232)	[1]
Dividends to shareholders:
Common									(4,479)		(4,479)
Preferred, net of tax benefits									(176)		(176)
Treasury purchases	(148,121)
Treasury purchases								(10,047)			(10,047)
Employee plan issuances	43,910
Employee plan issuances	12		1,272					1,196			2,480
Preferred stock conversions	4,982
Preferred stock conversions		(40)	5					35			0
ESOP debt impacts				(17)					1		(16)
Noncontrolling interest							38				38
ENDING BALANCE at Jun. 30, 2008	3,032,717
ENDING BALANCE at Jun. 30, 2008	4,002	1,366	60,307	(1,325)	3,746		290	(47,588)	48,986		69,784
Net earnings									13,436		13,436
Other comprehensive income:
Financial statement translation					(6,151)						(6,151)
Hedges and investment securities, net of $452 in 2009, $1,664 in 2008 and $459 in 2007 tax					748						748
Defined benefit retirement plans, net of $879 in 2009 and $120 in 2008 tax					(1,701)						(1,701)
Cumulative impact for adoption of new accounting guidance									(84)	[1]	(84)	[1]
Dividends to shareholders:
Common									(4,852)		(4,852)
Preferred, net of tax benefits									(192)		(192)
Treasury purchases	(98,862)
Treasury purchases								(6,370)			(6,370)
Employee plan issuances	16,841
Employee plan issuances	5		804					428			1,237
Preferred stock conversions	4,992
Preferred stock conversions		(42)	7					35			0
Shares tendered for Folgers coffee subsidiary	(38,653)
Shares tendered for Folgers coffee subsidiary								(2,466)			(2,466)
ESOP debt impacts				(15)					15		0
Noncontrolling interest							(7)				(7)
ENDING BALANCE at Jun. 30, 2009	2,917,035
ENDING BALANCE at Jun. 30, 2009	$4,007	$1,324	$61,118	($1,340)	($3,358)		$283	($55,961)	$57,309		$63,382
[1]Cumulative impact of adopting new accounting guidance relates to: 2007 - defined benefit and post retirement plans; 2008 - uncertainty in income taxes; 2009 - split-dollar life insurance arrangements.

2_Statement Of Shareholders Equ

Statement Of Shareholders Equity And Other Comprehensive Income (Parenthetical) (USD $)
In Millions	12 Months Ended Jun. 30, 2009	12 Months Ended Jun. 30, 2008	12 Months Ended Jun. 30, 2007
Hedges and investment securities, tax	$452	$1,664	$459
Defined benefit retirement plans, tax	$879	$120

Statement Of Cash Flows Indirec

Statement Of Cash Flows Indirect (USD $)
In Millions	12 Months Ended Jun. 30, 2009	12 Months Ended Jun. 30, 2008	12 Months Ended Jun. 30, 2007
CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR	$3,313	$5,354	$6,693
OPERATING ACTIVITIES
Net earnings	13,436	12,075	10,340
Depreciation and amortization	3,082	3,166	3,130
Share-based compensation expense	516	555	668
Deferred income taxes	596	1,214	253
Gain on sale of businesses	(2,377)	(284)	(153)
Change in accounts receivable	415	432	(729)
Change in inventories	721	(1,050)	(389)
Change in accounts payable, accrued and other liabilities	(742)	297	(278)
Change in other operating assets and liabilities	(758)	(1,270)	(151)
Other	30	(127)	719
TOTAL OPERATING ACTIVITIES	14,919	15,008	13,410
INVESTING ACTIVITIES
Capital expenditures	(3,238)	(3,046)	(2,945)
Proceeds from asset sales	1,087	928	281
Acquisitions, net of cash acquired	(368)	(381)	(492)
Change in investments	166	(50)	673
TOTAL INVESTING ACTIVITIES	(2,353)	(2,549)	(2,483)
FINANCING ACTIVITIES
Dividends to shareholders	(5,044)	(4,655)	(4,209)
Change in short-term debt	(2,420)	2,650	9,006
Additions to long-term debt	4,926	7,088	4,758
Reductions of long-term debt	(2,587)	(11,747)	(17,929)
Treasury stock purchases	(6,370)	(10,047)	(5,578)
Impact of stock options and other	681	1,867	1,499
TOTAL FINANCING ACTIVITIES	(10,814)	(14,844)	(12,453)
EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS	(284)	344	187
CHANGE IN CASH AND CASH EQUIVALENTS	1,468	(2,041)	(1,339)
CASH AND CASH EQUIVALENTS, END OF YEAR	4,781	3,313	5,354
Cash payments for:
Interest	1,226	1,373	1,330
Income Taxes	3,248	3,499	4,116
Assets acquired through non-cash capital leases	8	13	41
Divestiture of coffee business in exchange for shares of P&G stock	$2,466	$0	$0

SUMMARY OF SIGNIFICANT ACCOUNTI

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
	12 Months Ended Jun. 30, 2009 USD / shares
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Nature of Operations The Procter Gamble Companys (the Company, we or us) business is focused on providing branded consumer goods products of superior quality and value. Our products are sold in more than 180 countries primarily through retail operations including mass merchandisers, grocery stores, membership club stores, drug stores, department stores, salons and high-frequency stores. We have on-the-ground operations in approximately 80 countries. Basis of Presentation The Consolidated Financial Statements include the Company and its controlled subsidiaries. Intercompany transactions are eliminated. Use of Estimates Preparation of 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 the amounts reported in the Consolidated Financial Statements and accompanying disclosures. These estimates are based on managements best knowledge of current events and actions the Company may undertake in the future. Estimates are used in accounting for, among other items, consumer and trade promotion accruals, pensions, post-employment benefits, stock options, valuation of acquired intangible assets, useful lives for depreciation and amortization, future cash flows associated with impairment testing for goodwill, indefinite-lived intangible assets and long-lived assets, deferred tax assets, uncertain income tax positions and contingencies. Actual results may ultimately differ from estimates, although management does not generally believe such differences would materially affect the financial statements in any individual year. However, in regard to ongoing impairment testing of goodwill and indefinite-lived intangible assets, significant deterioration in future cash flow projections or other assumptions used in valuation models, versus those anticipated at the time of the initial valuations, could result in impairment charges that may materially affect the financial statements in a given year. Revenue Recognition Sales are recognized when revenue is realized or realizable and has been earned. Most revenue transactions represent sales of inventory. The revenue recorded is presented net of sales and other taxes we collect on behalf of governmental authorities and includes shipping and handling costs, which generally are included in the list price to the customer. Our policy is to recognize revenue when title to the product, ownership and risk of loss transfer to the customer, which can be on the date of shipment or the date of receipt by the customer. A provision for payment discounts and product return allowances is recorded as a reduction of sales in the same period that the revenue is recognized. Trade promotions, consisting primarily of customer pricing allowances, merchandising funds and consumer coupons, are offered through various programs to customers and consumers. Sales are recorded net of trade promotion spending, which is recognized as incurred, generally at the time of the sale. Most of these arrangements have terms of approximately one year. A

GOODWILL AND INTANGIBLE ASSETS

GOODWILL AND INTANGIBLE ASSETS
	12 Months Ended Jun. 30, 2009 USD / shares
GOODWILL AND INTANGIBLE ASSETS	NOTE 2 GOODWILL AND INTANGIBLE ASSETS The change in the net carrying amount of goodwill by Global Business Unit (GBU) was as follows: 2009 2008 BEAUTY GROOMING GBU Beauty, beginning of year $ 19,662 $ 17,994 Acquisitions and divestitures 66 154 Translation and other (1,060 ) 1,514 Goodwill, June30 18,668 19,662 Grooming, beginning of year 22,553 21,576 Acquisitions and divestitures (214 ) (236 ) Translation and other (948 ) 1,213 Goodwill, June30 21,391 22,553 HEALTH WELL-BEING GBU Health Care, beginning of year 8,750 8,482 Acquisitions and divestitures (81 ) (59 ) Translation and other (265 ) 327 Goodwill, June30 8,404 8,750 Snacks and Pet Care, beginning of year 2,434 2,407 Acquisitions and divestitures (356 ) (5 ) Translation and other (23 ) 32 Goodwill, June30 2,055 2,434 HOUSEHOLD CARE GBU Fabric Care and Home Care, beginning of year 4,655 4,470 Acquisitions and divestitures (46 ) (43 ) Translation and other (201 ) 228 Goodwill, June30 4,408 4,655 Baby Care and Family Care, beginning of year 1,713 1,623 Acquisitions and divestitures (7 ) (34 ) Translation and other (120 ) 124 Goodwill, June30 1,586 1,713 GOODWILL, Net, beginning of year 59,767 56,552 Acquisitions and divestitures (638 ) (223 ) Translation and other (2,617 ) 3,438 Goodwill, June30 56,512 59,767 The acquisition and divestiture impact during fiscal 2009 in Snacks and Pet Care is primarily due to the divestiture of the Coffee business. The remaining decrease in goodwill during fiscal 2009 is primarily due to currency translation across all GBUs. Identifiable intangible assets were comprised of: 2009 2008 June30 GrossCarrying Amount Accumulated Amortization GrossCarrying Amount Accumulated Amortization INTANGIBLE ASSETS WITH DETERMINABLE LIVES Brands $ 3,580 $ 1,253 $ 3,564 $ 1,032 Patents and technology 3,168 1,332 3,188 1,077 Customer relationships 1,853 411 1,947 353 Other 320 210 333 209 TOTAL 8,921 3,206 9,032 2,671 BRANDS WITH INDEFINITE LIVES 26,891 27,872 TOTAL 35,812 3,206 36,904 2,671 The amortization of intangible assets for the years ended June30, 2009, 2008 and 2007 was $648, $649 and $640, respectively. Estimated amortization expense over the next five years is as follows: 2010 - $570; 2011 - $523; 2012 - $489; 2013 - $462;

SUPPLEMENTAL FINANCIAL INFORMAT

SUPPLEMENTAL FINANCIAL INFORMATION
	12 Months Ended Jun. 30, 2009 USD / shares
SUPPLEMENTAL FINANCIAL INFORMATION	NOTE 3 SUPPLEMENTAL FINANCIAL INFORMATION Selected components of current and noncurrent liabilities were as follows: June30 2009 2008 ACCRUED AND OTHER LIABILITIES - CURRENT Marketing and promotion $ 2,378 $ 2,760 Compensation expenses 1,464 1,527 Accrued Gillette exit costs 111 257 Taxes payable 722 945 Other 3,926 5,610 TOTAL 8,601 11,099 OTHER NONCURRENT LIABILITIES Pension benefits $ 3,798 $ 3,146 Other postretirement benefits 1,516 512 Unrecognized tax benefits 2,705 3,075 Other 1,127 1,131 TOTAL 9,146 7,864 Gillette Acquisition On October1, 2005, we completed our acquisition of The Gillette Company (Gillette) for total consideration of $53.4 billion including common stock, the fair value of vested stock options and acquisition costs. In connection with this acquisition, we recognized an assumed liability for Gillette exit costs of $1.2 billion, including $854 in separation costs related to approximately 5,500 people, $55 in employee relocation costs and $320 in other exit costs. These costs are primarily related to the elimination of selling, general and administrative overlap between the two companies in areas like Global Business Services, corporate staff and go-to-market support, as well as redundant manufacturing capacity. These activities are substantially complete as of June30, 2009. Total integration plan charges against the assumed liability were $51, $286 and $438 for the years ended June 2009, 2008 and 2007, respectively. A total of $106 and $121 of the liability was reversed during the years ended June 2009 and 2008, respectively, related to underspending on a number of projects that were concluded during the period, which resulted in a reduction of goodwill during those years.

SHORT-TERM AND LONG-TERM DEBT

SHORT-TERM AND LONG-TERM DEBT
	12 Months Ended Jun. 30, 2009 USD / shares
SHORT-TERM AND LONG-TERM DEBT	NOTE 4 SHORT-TERM AND LONG-TERM DEBT June30 2009 2008 DEBT DUE WITHIN ONE YEAR Current portion of long-term debt $ 6,941 $ 1,746 Commercial paper 5,027 9,748 Floating rate notes 4,250 1,500 Other 102 90 TOTAL 16,320 13,084 The weighted average short-term interest rates were 2.0% and 2.7% as of June30, 2009 and 2008, respectively, including the effects of interest rate swaps discussed in Note 5. June30 2009 2008 LONG-TERM DEBT Floating rate note due July 2009 $ 1,750 $ 1,750 Floating rate note due August 2009 1,500 1,500 6.88% USD note due September 2009 1,000 1,000 Floating rate note due March 2010 750 2% JPY note due June 2010 522 467 4.88% EUR note due October 2011 1,411 1,573 3.38% EUR note due December 2012 1,975 2,203 4.60% USD note due January 2014 2,000 4.50% EUR note due May 2014 2,116 2,360 4.95% USD note due August 2014 900 900 3.50% USD note due February 2015 750 4.85% USD note due December 2015 700 700 5.13% EUR note due October 2017 1,552 1,731 4.70% USD note due February 2019 1,250 4.13% EUR note due December 2020 846 944 9.36% ESOP debentures due 2009-2021(1) 896 934 4.88% EUR note due May 2027 1,411 1,573 6.25% GBP note due January 2030 832 993 5.50% USD note due February 2034 500 500 5.80% USD note due August 2034 600 600 5.55% USD note due March 2037 1,400 1,400 Capital lease obligations 392 407 All other long-term debt 2,540 3,792 Current portion of long-term debt (6,941 ) (1,746 ) TOTAL 20,652 23,581 (1) Debt issued by the ESOP is guaranteed by the Company and must be recorded as debt of the Company as discussed in Note 8. Long-term weighted average interest rates were 4.9% and 4.5% as of June30, 2009 and 2008, respectively, including the effects of interest rate swaps and net investment hedges discussed in Note 5. The fair value of the long-term debt was $21,514 and $23,276 at June30, 2009 and 2008, respectively. Long-term debt maturities during the next five years are as follows: 2010 - $6,941; 2011 - $47; 2012 - $1,474; 2013 - $2,013; and 2014 - $4,154. The Procter Gamble Company fully and unconditionally guarantees the registered debt and securities issued by its 100% owned finance subsidiaries.

RISK MANAGEMENT ACTIVITIES AND

RISK MANAGEMENT ACTIVITIES AND FAIR VALUE MEASUREMENTS
	12 Months Ended Jun. 30, 2009 USD / shares
RISK MANAGEMENT ACTIVITIES AND FAIR VALUE MEASUREMENTS	NOTE 5 RISK MANAGEMENT ACTIVITIES AND FAIR VALUE MEASUREMENTS As a multinational company with diverse product offerings, we are exposed to market risks, such as changes in interest rates, currency exchange rates and commodity prices. We evaluate exposures on a centralized basis to take advantage of natural exposure netting and correlation. To the extent we choose to manage volatility associated with the net exposures, we enter into various financial transactions which we account for using the applicable accounting guidance for derivative instruments and hedging activities. These financial transactions are governed by our policies covering acceptable counterparty exposure, instrument types and other hedging practices. At inception, we formally designate and document qualifying instruments as hedges of underlying exposures. We formally assess, both at inception and at least quarterly, whether the financial instruments used in hedging transactions are effective at offsetting changes in either the fair value or cash flows of the related underlying exposure. Fluctuations in the value of these instruments generally are offset by changes in the fair value or cash flows of the underlying exposures being hedged. This offset is driven by the high degree of effectiveness between the exposure being hedged and the hedging instrument. The ineffective portion of a change in the fair value of a qualifying instrument is immediately recognized in earnings. The amount of ineffectiveness recognized is immaterial for all periods presented. Credit Risk Management We have counterparty credit guidelines and generally enter into transactions with investment grade financial institutions. Counterparty exposures are monitored daily and downgrades in credit rating are reviewed on a timely basis. Credit risk arising from the inability of a counterparty to meet the terms of our financial instrument contracts generally is limited to the amounts, if any, by which the counterpartys obligations to us exceed our obligations to the counterparty. We have not incurred and do not expect to incur material credit losses on our risk management or other financial instruments. Certain of the Companys financial instruments used in hedging transactions are governed by industry standard netting agreements with counterparties. If the Companys credit rating were to fall below the levels stipulated in the agreements, the counterparties could demand either collateralization or termination of the arrangement. The aggregate fair value of the instruments covered by these contractual features that are in a net liability position as of June30, 2009 was $288 million. The Company has never been required to post any collateral as a result of these contractual features. Interest Rate Risk Management Our policy is to manage interest cost using a mixture of fixed-rate and variable-rate debt. To manage this risk in a cost-efficient manner, we enter into interest rate swaps in which we agree to exchange with the counterparty, at specified intervals, the difference between fixed and variable interest amounts calculated by reference to an agreed-upon notional amount. Interest rate swaps th

EARNINGS PER SHARE

EARNINGS PER SHARE
	12 Months Ended Jun. 30, 2009 USD / shares
EARNINGS PER SHARE	NOTE 6 EARNINGS PER SHARE Net earnings less preferred dividends (net of related tax benefits) are divided by the weighted average number of common shares outstanding during the year to calculate basic net earnings per common share. Diluted net earnings per common share are calculated to give effect to stock options and other stock-based awards (see Note 7) and assume conversion of preferred stock (see Note 8). Net earnings and common shares used to calculate basic and diluted net earnings per share were as follows: Years ended June30 2009 2008 2007 NET EARNINGS FROM CONTINUING OPERATIONS $ 10,680 $ 11,291 $ 9,662 Preferred dividends, net of tax benefit (192 ) (176 ) (161 ) NET EARNINGS FROM CONTINUING OPERATIONS AVAILABLE TO COMMON SHAREHOLDERS 10,488 11,115 9,501 Preferred dividends, net of tax benefit 192 176 161 DILUTED NET EARNINGS FROM CONTINUING OPERATIONS 10,680 11,291 9,662 Net earnings from discontinued operations 2,756 784 678 NET EARNINGS 13,436 12,075 10,340 Shares in millions; Years ended June30 2009 2008 2007 Basic weighted average common shares outstanding 2,952.2 3,080.8 3,159.0 Effect of dilutive securities Conversion of preferred shares (1) 139.2 144.2 149.6 Exercise of stock options and other unvested equity awards(2) 62.7 91.8 90.0 DILUTED WEIGHTED AVERAGE COMMON SHARES OUTSTANDING 3,154.1 3,316.8 3,398.6 (1) Despite being included currently in diluted net earnings per common share, the actual conversion to common stock occurs pursuant to the repayment of the ESOPs obligations through 2035. (2) Approximately 92million in 2009, 40million in 2008 and 41million in 2007 of the Companys outstanding stock options were not included in the diluted net earnings per share calculation because the options were out of the money or to do so would have been antidilutive (i.e., the total proceeds upon exercise would have exceeded the market value of the underlying common shares).

STOCK-BASED COMPENSATION

STOCK-BASED COMPENSATION
	12 Months Ended Jun. 30, 2009 USD / shares
STOCK-BASED COMPENSATION	NOTE 7 STOCK-BASED COMPENSATION We have stock-based compensation plans under which we annually grant stock option and restricted stock awards to key managers and directors. Exercise prices on options granted have been and continue to be set equal to the market price of the underlying shares on the date of the grant. The key manager stock option awards granted since September 2002 are vested after three years and have a 10-year life. The key manager stock option awards granted from July 1998 through August 2002 vested after three years and have a 15-year life. Key managers can elect to receive up to 50% of the value of their option award in restricted stock units (RSUs). Key manager RSUs are vested and settled in shares of common stock five years from the grant date. The awards provided to the Companys directors are in the form of restricted stock and RSUs. In addition to our key manager and director grants, we make other minor stock option and RSU grants to employees for which the terms are not substantially different. A total of 229million shares of common stock were authorized for issuance under stock-based compensation plans approved by shareholders in 2001 and 2003, of which 12million remain available for grant. An additional 20million shares of common stock available for issuance under a plan approved by Gillette shareholders in 2004 were assumed by the Company in conjunction with the acquisition of Gillette. A total of 10million of these shares remain available for grant under this plan. Total stock-based compensation expense for stock option grants was $460, $522 and $612 for 2009, 2008 and 2007, respectively. The total income tax benefit recognized in the income statement for these stock-based compensation arrangements was $126, $141 and $163 for 2009, 2008 and 2007, respectively. Total compensation cost for restricted stock, RSUs and other stock-based grants was $56, $33 and $56 in 2009, 2008 and 2007, respectively. In calculating the compensation expense for stock options granted, we utilize a binomial lattice-based valuation model. Assumptions utilized in the model, which are evaluated and revised, as necessary, to reflect market conditions and experience, were as follows: Years ended June30 2009 2008 2007 Interest rate 0.7-3.8 % 1.3-3.8 % 4.3-4.8 % Weighted average interest rate 3.6 % 3.4 % 4.5 % Dividend yield 2.0 % 1.9 % 1.9 % Expected volatility 18-34 % 19-25 % 16-20 % Weighted average volatility 21 % 20 % 19 % Expected life in years 8.7 8.3 8.7 Because lattice-based option valuation models incorporate ranges of assumptions for inputs, those ranges are disclosed in the preceding table. Expected volatilities are based on a combination of historical volatility of our stock and implied volatilities of call options on our stock. We use historical data to estimate option exercise and employee termination patterns within the valuation model. The expected life of options granted is derived from the output of the option valuation model and represents the average period of time

POSTRETIREMENT BENEFITS AND EMP

POSTRETIREMENT BENEFITS AND EMPLOYEE STOCK OWNERSHIP PLAN
	12 Months Ended Jun. 30, 2009 USD / shares
POSTRETIREMENT BENEFITS AND EMPLOYEE STOCK OWNERSHIP PLAN	NOTE 8 POSTRETIREMENT BENEFITS AND EMPLOYEE STOCK OWNERSHIP PLAN We offer various postretirement benefits to our employees. Defined Contribution Retirement Plans We have defined contribution plans which cover the majority of our U.S. employees, as well as employees in certain other countries. These plans are fully funded. We generally make contributions to participants accounts based on individual base salaries and years of service. Total global defined contribution expense was $364, $290, and $273 in 2009, 2008 and 2007, respectively. The primary U.S. defined contribution plan (the U.S. DC plan) comprises the majority of the balances and expense for the Companys defined contribution plans. For the U.S. DC plan, the contribution rate is set annually. Total contributions for this plan approximated 15% of total participants annual wages and salaries in 2009, 2008 and 2007. We maintain The Procter Gamble Profit Sharing Trust (Trust) and Employee Stock Ownership Plan (ESOP) to provide a portion of the funding for the U.S. DC plan, as well as other retiree benefits. Operating details of the ESOP are provided at the end of this Note. The fair value of the ESOP Series A shares allocated to participants reduces our cash contribution required to fund the U.S. DC plan. Defined Benefit Retirement Plans and Other Retiree Benefits We offer defined benefit retirement pension plans to certain employees. These benefits relate primarily to local plans outside the U.S. and, to a lesser extent, plans assumed in the Gillette acquisition covering U.S. employees. We also provide certain other retiree benefits, primarily health care and life insurance, for the majority of our U.S. employees who become eligible for these benefits when they meet minimum age and service requirements. Generally, the health care plans require cost sharing with retirees and pay a stated percentage of expenses, reduced by deductibles and other coverages. These benefits are primarily funded by ESOP Series B shares, as well as certain other assets contributed by the Company. Obligation and Funded Status. We use a June30 measurement date for our defined benefit retirement plans and other retiree benefit plans. The following provides a reconciliation of benefit obligations, plan assets and funded status of these plans: Pension Benefits (1) OtherRetireeBenefits(2) Years ended June30 2009 2008 2009 2008 CHANGE IN BENEFIT OBLIGATION Benefit obligation at beginning of year (3) $ 10,095 $ 9,819 $ 3,553 $ 3,558 Service cost 214 263 91 95 Interest cost 551 539 243 226 Participants contributions 15 14 55 58 Amendments 47 52 (11 ) Actuarial (gain) loss 456 (655 ) 186 (232 ) Acquisitions (divestitures) (3 ) (7 ) (17 ) 2 Curtailments and settlements 3 (68 ) (3 ) Special termination benefits 3 1 16 2 Currency translation and other (867 ) 642 27 67 Benefit pa

INCOME TAXES

INCOME TAXES
	12 Months Ended Jun. 30, 2009 USD / shares
INCOME TAXES	NOTE 9 INCOME TAXES Income taxes are recognized for the amount of taxes payable for the current year and for the impact of deferred tax liabilities and assets, which represent future tax consequences of events that have been recognized differently in the financial statements than for tax purposes. Deferred tax assets and liabilities are established using the enacted statutory tax rates and are adjusted for any changes in such rates in the period of change. Earnings from continuing operations before income taxes consisted of the following: Years ended June30 2009 2008 2007 United States $ 8,409 $ 8,167 $ 8,268 International 6,004 6,718 5,394 TOTAL 14,413 14,885 13,662 The provision for income taxes on continuing operations consisted of the following: Years ended June30 2009 2008 2007 CURRENT TAX EXPENSE U.S. federal $ 1,619 $ 670 $ 2,354 International 1,268 1,515 1,294 U.S. state and local 229 188 91 3,116 2,373 3,739 DEFERRED TAX EXPENSE U.S. federal 595 1,272 240 International and other 22 (51 ) 21 617 1,221 261 TOTAL TAX EXPENSE 3,733 3,594 4,000 A reconciliation of the U.S. federal statutory income tax rate to our actual income tax rate on continuing operations is provided below: Years ended June30 2009 2008 2007 U.S. federal statutory income tax rate 35.0 % 35.0 % 35.0 % Country mix impacts of foreign operations -7.1 % -6.8 % -4.5 % Income tax reserve adjustments -1.3 % -3.4 % -0.3 % Other -0.7 % -0.7 % -0.9 % EFFECTIVE INCOME TAX RATE 25.9 % 24.1 % 29.3 % Income tax reserve adjustments represent changes in our net liability for unrecognized tax benefits related to prior year tax positions. Tax benefits credited to shareholders equity totaled $556 and $1,823 for the years ended June30, 2009 and 2008, respectively. These primarily relate to the tax effects of net investment hedges, excess tax benefits from the exercise of stock options and the impacts of certain adjustments to pension and other retiree benefit obligations recorded in shareholders equity. We have undistributed earnings of foreign subsidiaries of approximately $25 billion at June30, 2009, for which deferred taxes have not been provided. Such earnings are considered indefinitely invested in the foreign subsidiaries. If such earnings were repatriated, additional tax expense may result, although the calculation of such additional taxes is not practicable. On July1, 2007, we adopted new accounting guidance on the accounting for uncertainty in income taxes. The adoption of the new guidance resulted in a decrease to retained earnings as of July1, 2007 of $232, which was reflected as a cumulative effect of a change in accou

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES
	12 Months Ended Jun. 30, 2009 USD / shares
COMMITMENTS AND CONTINGENCIES	NOTE 10 COMMITMENTS AND CONTINGENCIES Guarantees In conjunction with certain transactions, primarily divestitures, we may provide routine indemnifications (e.g., indemnification for representations and warranties and retention of previously existing environmental, tax and employee liabilities) which terms range in duration and in some circumstances are not explicitly defined. The maximum obligation under some indemnifications is also not explicitly stated and, as a result, the overall amount of these obligations cannot be reasonably estimated. Other than obligations recorded as liabilities at the time of divestiture, we have not made significant payments for these indemnifications. We believe that if we were to incur a loss on any of these matters, the loss would not have a material effect on our financial position, results of operations or cash flows. In certain situations, we guarantee loans for suppliers and customers. The total amount of guarantees issued under such arrangements is not material. Off-Balance Sheet Arrangements We do not have off-balance sheet financing arrangements, including variable interest entities, that have a material impact on our financial statements. Purchase Commitments We have purchase commitments for materials, supplies, services and property, plant and equipment as part of the normal course of business. Commitments made under take-or-pay obligations are as follows: 2010 - $1,258; 2011 - $872; 2012 - $787; 2013 - $525; 2014 - $156; and $299 thereafter. Such amounts represent future purchases in line with expected usage to obtain favorable pricing. Approximately 43% of our purchase commitments relate to service contracts for information technology, human resources management and facilities management activities that have been outsourced to third-party suppliers. Due to the proprietary nature of many of our materials and processes, certain supply contracts contain penalty provisions for early termination. We do not expect to incur penalty payments under these provisions that would materially affect our financial position, results of operations or cash flows. Operating Leases We lease certain property and equipment for varying periods. Future minimum rental commitments under noncancelable operating leases are as follows: 2010 - $305; 2011 - $272; 2012 - $223; 2013 - $202; 2014 - $176; and $442 thereafter. Operating lease obligations are shown net of guaranteed sublease income. Litigation We are subject to various legal proceedings and claims arising out of our business which cover a wide range of matters such as governmental regulations, antitrust and trade regulations, product liability, patent and trademark matters, income taxes and other actions. As previously disclosed, the Company is subject to a variety of investigations into potential competition law violations in Europe, including investigations initiated in the fourth quarter of fiscal 2008 by the European Commission with the assistance of national authorities from a variety of countries.We believe these matters involve a number of other consumer products companies and/or retail customers. The Companys policy is to comply with a

SEGMENT INFORMATION

SEGMENT INFORMATION
	12 Months Ended Jun. 30, 2009 USD / shares
SEGMENT INFORMATION	NOTE 11 SEGMENT INFORMATION Effective July1, 2009, the Company implemented a number of changes to the organization structure of the Beauty GBU, which resulted in changes to the components of its reportable segment structure. The following discussion and segment information reflect the organizational changes for all periods presented. We are organized under three GBUs as follows: The Beauty and Grooming GBU includes the Beauty and the Grooming businesses. The Beauty business is comprised of female beauty products including cosmetics, deodorants, female blades and razors, personal cleansing and skin care, as well as hair care retail and salon professional and prestige fragrances. The Grooming business includes electric hair removal devices, home appliances, male blades and razors and male personal care products including deodorants, face and shave products, hair care and personal cleansing. The Health and Well-Being GBU includes the Health Care and the Snacks and Pet Care businesses. The Health Care business includes feminine care, oral care and personal health care. The Snacks and Pet Care business includes pet food and snacks. The Household Care GBU includes the Fabric Care and Home Care as well as the Baby Care and Family Care businesses. The Fabric Care and Home Care business includes air care, batteries, dish care, fabric care and surface care. The Baby Care and Family Care business includes baby wipes, bath tissue, diapers, facial tissue and paper towels. Under U.S. GAAP, we have six reportable segments: Beauty; Grooming; Health Care; Snacks and Pet Care; Fabric Care and Home Care; and Baby Care and Family Care. The accounting policies of the businesses are generally the same as those described in Note 1. Differences between these policies and U.S. GAAP primarily reflect: income taxes, which are reflected in the businesses using applicable blended statutory rates; the recording of fixed assets at historical exchange rates in certain high-inflation economies; and the treatment of certain unconsolidated investees. Certain unconsolidated investees are managed as integral parts of our business units for management reporting purposes. Accordingly, these partially owned operations are reflected as consolidated subsidiaries in segment results, with 100% recognition of the individual income statement line items through before-tax earnings. Eliminations to adjust these line items to U.S. GAAP are included in Corporate. In determining after-tax earnings for the businesses, we eliminate the share of earnings applicable to other ownership interests, in a manner similar to minority interest and apply statutory tax rates. Adjustments to arrive at our effective tax rate are also included in Corporate. Corporate includes certain operating and non-operating activities that are not reflected in the operating results used internally to measure and evaluate the businesses, as well as eliminations to adjust management reporting principles to U.S. GAAP. Operating activities in Corporate include the results of incidental businesses managed at the corporate level along with the elimination of individual revenues and expe

DISCONTINUED OPERATIONS

DISCONTINUED OPERATIONS
	12 Months Ended Jun. 30, 2009 USD / shares
DISCONTINUED OPERATIONS	NOTE 12 DISCONTINUED OPERATIONS In October 2009, the Company completed the divestiture of our global pharmaceuticals business to Warner Chilcott plc (Warner Chilcott) for $2.8 billion of cash, net of assumed and transferred liabilities. Under the terms of the agreement, Warner Chilcott acquired our portfolio of branded pharmaceutical products, our prescription drug product pipeline and manufacturing facilities in Puerto Rico and Germany.In addition, the majority of the 2,300 employees working on the pharmaceuticals business were transferred to Warner Chilcott. The pharmaceuticals business had historically been part of the Companys Health Care reportable segment. In accordance with the applicable accounting guidance for the disposal of long-lived assets, the results of the pharmaceuticals business are presented as discontinued operations and, as such, have been excluded from both continuing operations and segment results for all periods presented. In November 2008, the Company completed the divestiture of our coffee business through the merger of its Folgers coffee subsidiary into The J.M. Smucker Company (Smucker) in an all-stock reverse Morris Trust transaction. In connection with the merger, 38.7million shares of common stock of the Company were tendered by shareholders and exchanged for all shares of Folgers common stock, resulting in an increase of treasury stock of $2,466. Pursuant to the merger, a Smucker subsidiary merged with and into Folgers and Folgers became a wholly owned subsidiary of Smucker. The Company recorded an after-tax gain on the transaction of $2,011, which is included in Net Earnings from Discontinued Operations in the Consolidated Statement of Earnings for the year ended June30, 2009. The coffee business had historically been part of the Companys Snacks, Coffee and Pet Care reportable segment, as well as the coffee portion of our away-from-home business, which was included in the Fabric Care and Home Care reportable segment. In accordance with the applicable accounting guidance for the impairment or disposal of long-lived assets, the results of Folgers are presented as discontinued operations and, as such, have been excluded from both continuing operations and segment results for all years presented. Following is selected financial information included in Net Earnings from Discontinued Operations for the pharmaceuticals and coffee businesses: Years Ended June30 2009 2008 2007 Total Pharma Coffee Pharma Coffee Pharma Coffee 2009 2008 2007 Net Sales $ 2,335 $ 668 $ 2,491 $ 1,754 $ 2,391 $ 1,644 $ 3,003 $ 4,245 $ 4,035 Earnings from discontinued operations 912 212 747 446 601 447 1,124 1,193 1,048 Income tax expense (299 ) (80 ) (240 ) (169 ) (200 ) (170 ) (379 ) (409 ) (370 ) Gain on sale of discontinued operation 1,896 1,896 D

QUARTERLY RESULTS

QUARTERLY RESULTS (UNAUDITED)
	12 Months Ended Jun. 30, 2009 USD / shares
QUARTERLY RESULTS (UNAUDITED)	NOTE 13 QUARTERLY RESULTS (UNAUDITED) Quarters Ended Sept 30 Dec 31 Mar 31 Jun 30 TotalYear NET SALES 2008-2009 $ 20,983 $ 19,763 $ 17,864 $ 18,084 $ 76,694 2007-2008 19,189 20,395 19,423 20,250 79,257 OPERATING INCOME 2008 - 2009 4,386 4,055 3,553 3,380 15,374 2007-2008 4,147 4,394 3,861 3,577 15,979 GROSS MARGIN 2008 - 2009 49.7 % 50.4 % 49.0 % 49.0 % 49.5 % 2007-2008 52.1 % 51.2 % 50.5 % 48.1 % 50.5 % NET EARNINGS: Earnings from continuing operations 2008 - 2009 $ 3,115 $ 2,813 $ 2,429 $ 2,323 $ 10,680 2007-2008 2,893 3,048 2,531 2,819 11,291 Earnings from discontinued operations 2008 - 2009 233 2,191 184 148 2,756 2007-2008 186 222 179 197 784 Net earnings 2008 - 2009 3,348 5,004 2,613 2,471 13,436 2007-2008 3,079 3,270 2,710 3,016 12,075 DILUTED NET EARNINGS PER COMMON SHARE: Earnings from continuing operations 2008 - 2009 $ 0.96 $ 0.89 $ 0.78 $ 0.75 $ 3.39 2007-2008 0.86 0.91 0.77 0.86 3.40 Earnings from discontinued operations 2008 - 2009 0.07 0.69 0.06 0.05 0.87 2007-2008 0.06 0.07 0.05 0.06 0.24 Diluted net earnings per common share 2008 - 2009 1.03 1.58 0.84 0.80 4.26 2007-2008 0.92 0.98 0.82 0.92 3.64 Financial Summary (Unaudited) Amounts in millions, except per share amounts 2009 2008 2007 2006 2005 2004 Net Sales $ 76,694 $ 79,257 $ 72,441 $ 64,416 $ 53,210 $ 48,451 Gross Margin 38,004 39,996 37,065 32,549 26,391 24,246 Operating Income 15,374 15,979 14,485 12,551 9,666 8,862 Net Earnings from Continuing Operations 10,680 11,291 9,662 8,187 6,384 5,740 Net Earnings from Discontinued Operations 2,756 784 678 497 539 416 Net Earnings 13,436 12,075 10,340 8,684 6,923 6,156 Net Earnings Margin from Continuing Operations 13.9 % 14.2 % 13.3 % 12.7 % 12.0 % 11.8 % Basic Net Earnings per Common Share: Earnings from continuing operations $ 3.55 $ 3.61 $ 3.01 $ 2.63 $ 2.48 $ 2.18 Earnings from discontinued operations 0.94 0.25 0.21 0.16 0.22 0.16 Basic Net Earnings per Common Share 4.49 3.86 3.22 2.79 2.70 2.34 Diluted Net Earnings per Common Share: Earnings from continuing operations

Document Information

Document Information
	12 Months Ended Jun. 30, 2009 USD / shares
Document Information [Text Block]
Document Type	8-K
Amendment Flag	false
Document Period End Date	2010-01-29

Entity Information

Entity Information
	12 Months Ended Jun. 30, 2009 USD / shares
Entity [Text Block]
Trading Symbol	PG
Entity Registrant Name	PROCTER & GAMBLE CO
Entity Central Index Key	0000080424