3. Given the current spot rate is 1.5780 CAD/USD, show the impact on GMs EPS
(earnings per share) when the CAD becomes (a) stronger at 1.5291 CAD/USD, and (b)
weaker at 1.6269 CAD/USD, when only translational exposures are considered.
4. Using the same set of exchange rate scenarios in Question 3, show the impact on GMs
EPS with a (a) 50% hedge policy, and (b) 75% hedge policy, when only transactional
exposures are considered. (Hint: excess cash reduces the required hedge amount).
Exhibit 6 GM's Largest Currency Exposures (Forecasted Receivables Less Payables) \begin{tabular}{|c|c|c|c|c|c|c|c|c|c|c|c|} \hline \begin{tabular}{c} As of \\ 12/31/00 \\ (Smillions) \end{tabular} & USD & EUR & JPY & GBP & SEK & AUD & CAD & CHF & PLN & MXP & OTHER \\ \hline GMNA & 800 & (400) & - & - & (200) & - & (1400) & - & - & 1200 & - \\ \hline GME & 400 & (2400) & 200 & 1400 & (800) & 400 & (200) & 400 & 200 & - & 800 \\ \hline GMAP & 200 & (200) & 200 & 200 & - & 200 & - & - & - & - & 200 \\ \hline GMLAAM & 600 & (400) & 500 & - & - & - & - & - & - & - & - \\ \hline GM Total & 2000 & (3400) & 900 & 1600 & (1000) & 600 & (1600) & 400 & 200 & 1200 & 1000 \\ \hline \end{tabular} Source: General Motors Figures have been disguised and do not reflect the actual operations of General Motors Corp. NOTES: GMNA: General Motors North America GME: General Motors Europe GMAP: General Motors Asian Pacific GMLAAM: General Motors Latin America, Africa, Middle East Exhibit 9 GM Canada - Projected Cash Flow Exposure \begin{tabular}{lr} \hline Cash Flows & Amount as of September 30, 2001 \\ \hline INFLOWS & 10,564 \\ \hline Canadian sales & 1,049 \\ \hline Tax refunds (GST) & \\ \hline OUTFLOWS & (10,180) \\ \hline Material purchases & (113) \\ \hline Capital expenditures & (1,737) \\ \hline Other structural costs & (1,258) \\ \hline Tax expenditures & (6) \\ \hline Other expenditures & (1,682) \\ \hline 12 month CS cash flow forecast & \end{tabular} Source: Company documents. Figures have been disguised and do not reflect the actual operations of General Motors Corp. Exhibit 10 GM Canada - Net Monetary Asset/Liability Exposure \begin{tabular}{l|c} \hline Balance Sheet Account & Amount as \\ & of \\ & September \\ & 30,2001 \\ \hline \end{tabular} \begin{tabular}{|l|l|} \hline ASSETS & \\ \hline Cash \& cash equivalents & 683 \\ \hline \end{tabular} \begin{tabular}{ll} Accounts \& notes receivable & 271 \\ \hline \end{tabular} \begin{tabular}{|l|l|} \hline Deferred income taxes & 118 \end{tabular} \begin{tabular}{|l|l|} \hline Pension asset & 1525 \\ \hline \end{tabular} LIABILITIES Outside - all other Other postretirement benefits (1949) Warranty (132) Accounts payable and other (2565) CS Monetary asset / (liability) position (2143) Source. Company documents. Figures have been disguised and do not reflect the actual operations of General Motors Corp. Exhibit 11 GM Argentina Balance Sheet, Monetary Assets and Liabilities by Currency, as of September 30, 2001 \begin{tabular}{|l|r|l|r|} \hline ARS Monetary Assets & & ARS Monetary Liabilities \\ \hline Scrap incentive owed by govt. & 45.8 & Payables to local suppliers & 24.1 \\ \hline Interest subsidy owed by govt. & 3.2 & Provisions to local suppliers & 11.3 \\ \hline VAT credit and other tax owed by govt. & 130.6 & ARS loan (VAT financing) & 13.7 \\ \hline Receivable (tax credit reimbursement) & 2.7 & Other provisions & 9.8 \\ \hline Other & 7.8 & Tax payable & 2 \\ \hline Total & 190.0 & Total & 60.9 \\ \hline & & & \\ \hline USD Monetary Assets & & USD Monetary Liabilities & 224.5 \\ \hline Cash & 2.5 & Accounts payable & 101.3 \\ \hline Receivables & 20.5 & Loans & 325.7 \\ \hline Total & 23.0 & Total & \\ \hline & & & \\ \hline \end{tabular} 1 Exhibit 13 Cost of Hedging the ARS Exposure in Argentina 2 3 \begin{tabular}{l|r} \hline & \multicolumn{1}{c}{ Cost } \\ \hline Time Horizon / Hedging Period & $6.40 \\ \hline One-month Forward & $18.20 \\ \hline Three-month Forward & $28.70 \\ \hline Six-month Forward & $40.30 \\ \hline \end{tabular} Source: Company documents. Exhibit 6 GM's Largest Currency Exposures (Forecasted Receivables Less Payables) \begin{tabular}{|c|c|c|c|c|c|c|c|c|c|c|c|} \hline \begin{tabular}{c} As of \\ 12/31/00 \\ (Smillions) \end{tabular} & USD & EUR & JPY & GBP & SEK & AUD & CAD & CHF & PLN & MXP & OTHER \\ \hline GMNA & 800 & (400) & - & - & (200) & - & (1400) & - & - & 1200 & - \\ \hline GME & 400 & (2400) & 200 & 1400 & (800) & 400 & (200) & 400 & 200 & - & 800 \\ \hline GMAP & 200 & (200) & 200 & 200 & - & 200 & - & - & - & - & 200 \\ \hline GMLAAM & 600 & (400) & 500 & - & - & - & - & - & - & - & - \\ \hline GM Total & 2000 & (3400) & 900 & 1600 & (1000) & 600 & (1600) & 400 & 200 & 1200 & 1000 \\ \hline \end{tabular} Source: General Motors Figures have been disguised and do not reflect the actual operations of General Motors Corp. NOTES: GMNA: General Motors North America GME: General Motors Europe GMAP: General Motors Asian Pacific GMLAAM: General Motors Latin America, Africa, Middle East Exhibit 9 GM Canada - Projected Cash Flow Exposure \begin{tabular}{lr} \hline Cash Flows & Amount as of September 30, 2001 \\ \hline INFLOWS & 10,564 \\ \hline Canadian sales & 1,049 \\ \hline Tax refunds (GST) & \\ \hline OUTFLOWS & (10,180) \\ \hline Material purchases & (113) \\ \hline Capital expenditures & (1,737) \\ \hline Other structural costs & (1,258) \\ \hline Tax expenditures & (6) \\ \hline Other expenditures & (1,682) \\ \hline 12 month CS cash flow forecast & \end{tabular} Source: Company documents. Figures have been disguised and do not reflect the actual operations of General Motors Corp. Exhibit 10 GM Canada - Net Monetary Asset/Liability Exposure \begin{tabular}{l|c} \hline Balance Sheet Account & Amount as \\ & of \\ & September \\ & 30,2001 \\ \hline \end{tabular} \begin{tabular}{|l|l|} \hline ASSETS & \\ \hline Cash \& cash equivalents & 683 \\ \hline \end{tabular} \begin{tabular}{ll} Accounts \& notes receivable & 271 \\ \hline \end{tabular} \begin{tabular}{|l|l|} \hline Deferred income taxes & 118 \end{tabular} \begin{tabular}{|l|l|} \hline Pension asset & 1525 \\ \hline \end{tabular} LIABILITIES Outside - all other Other postretirement benefits (1949) Warranty (132) Accounts payable and other (2565) CS Monetary asset / (liability) position (2143) Source. Company documents. Figures have been disguised and do not reflect the actual operations of General Motors Corp. Exhibit 11 GM Argentina Balance Sheet, Monetary Assets and Liabilities by Currency, as of September 30, 2001 \begin{tabular}{|l|r|l|r|} \hline ARS Monetary Assets & & ARS Monetary Liabilities \\ \hline Scrap incentive owed by govt. & 45.8 & Payables to local suppliers & 24.1 \\ \hline Interest subsidy owed by govt. & 3.2 & Provisions to local suppliers & 11.3 \\ \hline VAT credit and other tax owed by govt. & 130.6 & ARS loan (VAT financing) & 13.7 \\ \hline Receivable (tax credit reimbursement) & 2.7 & Other provisions & 9.8 \\ \hline Other & 7.8 & Tax payable & 2 \\ \hline Total & 190.0 & Total & 60.9 \\ \hline & & & \\ \hline USD Monetary Assets & & USD Monetary Liabilities & 224.5 \\ \hline Cash & 2.5 & Accounts payable & 101.3 \\ \hline Receivables & 20.5 & Loans & 325.7 \\ \hline Total & 23.0 & Total & \\ \hline & & & \\ \hline \end{tabular} 1 Exhibit 13 Cost of Hedging the ARS Exposure in Argentina 2 3 \begin{tabular}{l|r} \hline & \multicolumn{1}{c}{ Cost } \\ \hline Time Horizon / Hedging Period & $6.40 \\ \hline One-month Forward & $18.20 \\ \hline Three-month Forward & $28.70 \\ \hline Six-month Forward & $40.30 \\ \hline \end{tabular} Source: Company documents
