PolyOne 2009 Annual Report

(1)
Interest obligations are stated at the rate of interest that is defined
by the debt instrument, assuming that the debt is paid at maturity.
(2)
Pension and post-retirement obligations relate to our U.S. and international
pension and other post-retirement plans.
We expect to maintain existing levels of available capital
resources and meet our cash requirements in 2010. Expected
sources of cash in 2010 include cash from operations, additional
borrowings under existing loan agreements that are not fully drawn if
needed, cash distributions from equity affiliates and proceeds from
the sale of previously closed facilities and redundant assets.
Expected uses of cash in 2010 include interest payments, cash
taxes, contributions to our defined benefit pension plan, debt
retirements, environmental remediation at inactive and formerly
owned sites and capital expenditures. Capital expenditures are
currently estimated to be approximately $40 million in 2010, primarily
to maintain manufacturing operations, support an SAP implementation
in Asia and other strategic spending.
We may from time to time seek to retire or purchase our
outstanding debt through cash purchases and/or exchanges for
equity securities, in open market purchases, privately negotiated
transactions or otherwise. Such repurchases or exchanges, if any,
will depend on prevailing market conditions, our liquidity requirements,
contractual restrictions and other factors. The amounts
involved may be material.
Based on current projections, we believe that we will be able to
continue to manage and control working capital, discretionary
spending and capital expenditures and that cash provided by operating
activities, along with available borrowing capacity under our
receivables sale facility, should allow us to maintain adequate
levels of available capital resources to fund our operations and
meet debt service and minimum pension funding requirements for
both the short and long term.
Critical Accounting Policies and Estimates
Significant accounting policies are described more fully in Note 1,
Summary of Significant Accounting Policies, to the accompanying
consolidated financial statements. The preparation of financial
statements in conformity with U.S. generally accepted accounting
principles (U.S. GAAP) requires us to make estimates and assumptions
about future events that affect the amounts reported in our
financial statements and accompanying notes. We base our estimates
on historical experience and assumptions that we believe are
reasonable under the related facts and circumstances. The application
of these critical accounting policies involves the exercise of
judgment and use of assumptions for future uncertainties. Accordingly,
actual results could differ significantly from these estimates.
We believe that the following discussion addresses our most critical
accounting policies, which are those that are the most important to
the portrayal of our financial condition and results of operations and
require our most difficult, subjective and complex judgments. We
have reviewed these critical accounting policies and related disclosures
with the Audit Committee of our Board of Directors.
POLYONE CORPORATION
28