10-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C.  20549

FORM 10-K

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended April 30, 2011

Commission file number 002-26821

BROWN-FORMAN CORPORATION

(Exact name of registrant as specified in its charter)

Delaware	61-0143150
(State or other jurisdiction of	(IRS Employer
incorporation or organization)	Identification No.)
850 Dixie Highway	40210
Louisville, Kentucky	(Zip Code)
(Address of principal executive offices)

Registrant's telephone number, including area code (502) 585-1100

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class	Name of Each Exchange on Which Registered
Class A Common Stock (voting) $0.15 par value	New York Stock Exchange
Class B Common Stock (nonvoting) $0.15 par value	New York Stock Exchange
Securities registered pursuant to Section 12(g) of the Act	None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.  Yes     No

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.  Yes     No

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  Yes     No

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).  Yes     No

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.  o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.  See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer  þ	Accelerated filero
Non-accelerated filer  o  (Do not check if a smaller reporting company)	Smaller reporting companyo

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yeso     No  þ

The aggregate market value, as of the last business day of the most recently completed second fiscal quarter, of the voting and nonvoting equity held by nonaffiliates of the registrant was approximately $5,200,000,000.

The number of shares outstanding for each of the registrant's classes of Common Stock on June 20, 2011 was:

Class A Common Stock (voting)	56,534,863
Class B Common Stock (nonvoting)	88,362,029

DOCUMENTS INCORPORATED BY REFERENCE

Portions of the Registrant's 2011 Annual Report to Stockholders are incorporated by reference into Parts I, II, and IV of this report.  Portions of the Proxy Statement of Registrant for use in connection with the Annual Meeting of Stockholders to be held July 28, 2011 are incorporated by reference into Part IIIof this report.

PART I

Item 1.  Business

Brown-Forman Corporation (“we,” “us,” or “our” below) was incorporated under the laws of the State of Delaware in 1933, successor to a business founded in 1870 as a partnership and subsequently incorporated under the laws of the Commonwealth of Kentucky in 1901.

We primarily manufacture, bottle, import, export, and market a wide variety of alcoholic beverage brands.  Our principal beverage brands are:

Jack Daniel’s Tennessee Whiskey	Chambord Vodka
Jack Daniel’s Single Barrel	Don Eduardo Tequila
Jack Daniel’s Ready-to-Drinks	Early Times Bourbon
Jack Daniel’s Tennessee Honey	Early Times Kentucky Whisky
Gentleman Jack	el Jimador Tequila
Southern Comfort	Herradura Tequila
Southern Comfort Ready-to-Drinks	Korbel California Champagnes*
Southern Comfort Ready-to-Pours	New Mix Ready-to-Drinks
Southern Comfort Lime	Old Forester Bourbon
Finlandia Vodka	Pepe Lopez Tequilas
Antiguo Tequila	Sonoma-Cutrer Wines
Canadian Mist Blended Canadian Whisky	Tuaca Liqueur
Chambord Liqueur	Woodford Reserve Bourbon

*Represented in the U.S. and other select markets by Brown-Forman

The most important brand in our portfolio is Jack Daniel’s, which is the fifth-largest premium spirits brand and the largest selling American whiskey brand in the world according to volume statistics published in February 2011 by Impact Databank, a well-known trade publication. Our other leading global brands are Finlandia, the eighth-largest selling vodka, Southern Comfort, the third-largest selling liqueur, Canadian Mist, the fourth-largest selling Canadian whiskey, and el Jimador, the fourth-largest selling tequila, according to the recently published volume statistics referenced above. We believe the statistics used to rank these products are reasonably accurate.

Geographic information about net sales and long-lived assets is in Note 16 of the Notes to Consolidated Financial Statements on page 67 of our 2011 Annual Report to Stockholders, which information is incorporated into this report by reference.

Our strategy is to market high quality products that satisfy the preferences of consumers of legal drinking age and to support those products with extensive international, national, and regional marketing programs.  These programs are intended to extend consumer brand recognition and brand loyalty.

We own numerous valuable trademarks that are essential to our business.  Registrations of trademarks can generally be renewed indefinitely as long as the trademarks are in use.  Through licensing arrangements, we have authorized the use of some of our trademarks on promotional items for the primary purpose of enhancing brand awareness.

Customers

For information about our customers, refer to the section entitled "Our Distribution Network and Our Customers" on page 36 of the 2011 Annual Report to Stockholders, which information is incorporated into this report by reference.

Ingredients and Other Supplies

The principal raw materials used in manufacturing and packaging our distilled spirits are corn, rye, malted barley, agave, sugar, glass, cartons, PET (polyethylene terephthalate), labels, and wood for barrels, which are used for storage of bourbon, Tennessee whiskey, and certain tequilas.  The principal raw materials used in liqueurs are neutral spirits, sugar, and wine, while the principal raw materials used in our ready-to-drink products are sugar, neutral spirits, whiskey, tequila, or malt.  Currently, none of these raw materials is in short supply, and there are adequate sources from which they may be obtained, but shortages in some of these can occur.

Due to aging requirements, production of whiskeys, certain tequilas, and other distilled spirits is scheduled to meet demand three to ten years in the future. Accordingly, our inventories may be larger in relation to sales and total assets than would be normal for most other businesses.

The principal raw materials used in the production of wines are grapes, packaging materials and wood for wine barrels. Grapes are primarily purchased under contracts with independent growers, and we also own some vineyards in California; from time to time, our grape costs are adversely affected by weather and other forces that may limit production. We believe that our relationships with our growers are good.

Competition

For information about our competition, refer to the section entitled "Our Competition" on page 36 of the 2011 Annual Report to Stockholders, which information is incorporated into this report by reference.

Regulatory Environment

The Alcohol and Tobacco Tax and Trade Bureau of the United States Treasury Department regulates the wine and spirits industry with respect to production, blending, bottling, sales, advertising, and transportation of industry products. Also, each state regulates the advertising, promotion, transportation, sale, and distribution of such products.

Under federal regulations, bourbon and Tennessee whiskeys must be aged for at least two years in new charred oak barrels.  We age all of our whiskeys for a minimum of three to six years.  Federal regulations also require that "Canadian" whiskey must be manufactured in Canada in compliance with Canadian laws.  Mexican authorities regulate the production of tequilas, which among other specifications, require minimum aging periods for anejo (one year) and reposado (two months) tequilas.  We believe we are in compliance with these regulations.

Employees

As of April 30, 2011, we employed about 3,900 persons, including approximately 200 employed on a part-time or temporary basis.  We believe our employee relations are good.

For more information about our business, refer to the sections entitled “Our Operations and Our Markets” and “Our Brands” in Management’s Discussion and Analysis on pages 33 through 36 of the 2011 Annual Report to Stockholders, which information is incorporated into this report by reference.

Available Information

You may read and copy any materials that we file with the SEC at the SEC’s Public Reference Room at 100 F Street, NE, Washington, D.C. 20549. Information on the Public Reference Room may be obtained by calling the SEC at 1-800-SEC-0330. In addition, the SEC maintains an Internet site that contains reports, proxy and information statements, and other information regarding issuers that file with the SEC at http://www.sec.gov.

Our website address is www.brown-forman.com.  Please note that our website address is provided as an inactive textual reference only.  Our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and any amendments to these reports are available free of charge on our website as soon as reasonably practicable after we electronically file those reports with the SEC.  The information provided on our website is not part of this report, and is therefore not incorporated by reference, unless such information is otherwise specifically referenced elsewhere in this report.

On our website, we have posted our Corporate Governance Guidelines, our Code of Conduct and Compliance Guidelines that apply to all directors and employees, and our Code of Ethics that applies specifically to our senior executive and financial officers.  We have also posted on our website the charters of our Audit Committee, Compensation Committee, Corporate Governance and Nominating Committee, and Executive Committee of our Board of Directors.  Copies of these materials are also available free of charge by writing to our Secretary, Matthew E. Hamel, 850 Dixie Highway, Louisville, Kentucky 40210 or e-mailing him at Secretary@b-f.com.

Item 1A.  Risk Factors

This report contains statements, estimates, and projections that are "forward-looking statements" as defined under U.S. federal securities laws. Words such as “aim,” “anticipate,” “aspire,” “believe,” “envision,” “estimate,” “expect,” “expectation,” “intend,” “may,” “plan,” “potential,” “project,” “pursue,” “see,” “will,” “will continue,” and similar words identify forward-looking statements, which speak only as of the date we make them.  In addition, in our periodic filings with the SEC, press releases, and other written and oral statements, we discuss estimates and projections about trends, future performance and our business outlook. Such "forward-looking statements" inherently involve risks and uncertainties that could cause our actual results to differ materially from our historical results or our present expectations and projections, and adversely affect our results of operations, financial condition, and the trading price of our stock in future periods. We caution investors not to place undue reliance on any forward-looking statements, which speak only as of the date they are made. We undertake no obligation to update any forward-looking statement, whether as a result of new information, future events, or otherwise. The discussion of risks below and elsewhere in this report is by no means all inclusive, but is designed to highlight what we believe are some important factors to consider when evaluating our future performance.  There are also risks that are not presently known or not presently material, as well as other information set forth in this report, including trends, developments and uncertainties, that could materially affect our business.  You should carefully consider the risk factors below, and the information throughout this report, which could materially affect our business and financial results.

Unfavorable economic conditions could negatively affect our operations and results significantly.

Our business and financial results will continue to be affected by worldwide and regional economic conditions. The specific ramifications of unfavorable economic conditions on our business are difficult to predict, but some potentially significant effects are reduced consumer spending, distributor or retailer destocking, higher interest rates, changes in the rate of inflation (up or down), exchange rate fluctuations, credit or capital market instability, bank failures, and/or lower returns or discount rates on our pension assets (requiring higher contributions to our pension plans). Our suppliers, customers, and consumers could experience cash flow problems, increased cost or reduced availability of financing, credit defaults, and other financial hardships. The U.S. federal budget and individual state budget deficits could result in increased taxes on our products, business, customers, or consumers; and a number of proposals to increase taxes on beverage alcohol have been made at the federal and state levels in recent years. Governments in other countries in which we have a sizable business also may impose taxes and implement other austerity measures to manage the economic conditions in ways that hurt our business. Countries, including significant markets for us in Europe, may default on sovereign debt. For additional information with respect to the effects of changes in the value of our benefit plan obligations and assets on our financial results, see “Pension and other Postretirement Benefits” on page 47 of the 2011 Annual Report to Stockholders.

Further, as the economy picks back up, consumers may continue to curtail spending, make more value-driven and price-sensitive purchasing choices, and have more at-home drinking occasions rather than at restaurants, bars, and hotels. In sum, in a variety of different manifestations, unfavorable economic conditions could have significant adverse effects on our business, financial position, and results of operations.

Our global growth is subject to a number of commercial and political risks.

We currently market products in more than 135 countries. In addition to the United States, significant markets for us include Australia, United Kingdom, Mexico, Poland, Germany, France, Canada, Japan, Spain, Turkey, South Africa, Russia, Italy, and China. We expect our future growth rates in international markets to surpass our growth rates in the United States. Emerging regions, such as Eastern Europe, Latin America, and Asia, as well as countries that some companies consider to be developed markets, such as France and Australia, provide significant growth opportunities for us.  If anti-American sentiment became pronounced in the principal countries to which we export our beverage products, our global business could suffer.

Potentially unstable governments or legal systems, intergovernmental disputes, military conflicts, local labor conditions and business practices, nationalizations, closure of markets to exports or significant import tax increases or restrictions, inflation, recession, pandemics, terrorist activities in or outside of the United States, laws regulating activities of United States-based companies abroad, and other laws, regulations and policies of foreign governments, are also risks due to the global nature of our business. These and other political, commercial, and economic uncertainties in our various markets around the world may have a material adverse effect on our business, results of operations and future growth prospects.

The longer-term outlook for our business anticipates continued success of Jack Daniel's Tennessee Whiskey, Southern Comfort Liqueur, Finlandia Vodka, Tequila Herradura, el Jimador Tequila, their respective brand families, and our other brands. This outlook is based in part on favorable demographic trends for the sale of beverage alcohol through 2014 in the United States, and in many of our global markets for varying numbers of years. If these demographic trends do not translate into corresponding sales increases, we may fail to meet our growth expectations. In addition, the somewhat less favorable demographic trends in the United States for several years subsequent to 2014 could negatively affect our performance in those years and our ability to meet our longer-term strategic objectives.

Foreign currency exchange rate fluctuations affect our financial results.

The more we expand our business globally, the more exchange rate fluctuations relative to the United States dollar influence our financial results. In international markets, we sell our products, and pay for some goods, services, and manpower primarily in local currency. Since we sell more in local currencies than we purchase, we have a net exposure to changes in the value of the United States dollar relative to those currencies.  Thus, profits from our overseas businesses would be adversely affected if the dollar strengthens against other currencies in our major markets, especially the Euro, British pound, Australian dollar, and Polish zloty.  To buffer this effect, we regularly hedge a portion of our currency exposure; and as of April 30, 2011, we have hedged approximately 40% of our total fiscal 2012 transactional exposure to foreign currency fluctuations for our major currencies. Nevertheless, over time, our reported financial results generally will be hurt by a stronger United States dollar and helped by a weaker one.    For additional information with respect to foreign exchange effects on our business, see “Foreign Exchange” on page 38 of the 2011 Annual Report to Stockholders.

Higher costs or unavailability of materials could affect our financial results, as could our inability to obtain certain finished goods.

Our products use a number of materials and ingredients that we purchase from third-party suppliers. Our ability to make and sell our products hinges on having available all of the raw materials, product ingredients, finished product, glass, bottles, cans, bottle closures, packaging, and other materials used to produce and package them; without sufficient quantities of one or more key  materials, our operations and financial results could suffer. For instance, only a few glass producers make bottles on a scale sufficient for our requirements; and a single producer supplies most of our glass requirements. Similarly, a Finnish corporation distills and bottles our Finlandia Vodka products for us. If any of our key suppliers were no longer able to meet our timing, quality or capacity requirements, ceased doing business with us, or raised its prices, and we could not develop alternative cost-effective sources of supply or production, our operations and financial results could suffer.

Higher costs or insufficient availability of suitable grain, agave, water, grapes, wood, glass, closures, and other input materials and/or associated labor costs may affect adversely our financial results, since we may not be able to pass along such cost increases or shortages through higher prices to customers.  Weather, the physical effects of climate change, diseases and other agricultural uncertainties that affect the mortality, health, yield, quality or price of the various raw materials used in our products also present risks for our business, including in some cases potential impairment in the recorded value of our inventory.  Changes in frequency or intensity of weather can disrupt our supply chain as well, which may affect production operations, insurance costs and coverage, as well as the timely delivery of our products to customers.

As water is one of the major components of our products, the quality and quantity of the water available for use is important to our ability to operate our business. If hydrologic cycle patterns change, and droughts become more common and severe, or if the water supply were interrupted for other reasons, there may be a scarcity of desirable water in some of the key production regions for our products, including Tennessee, Finland, Mexico, and California.

When energy costs rise, our transportation, freight and other operating costs, such as distilling and bottling expenses, also increase.   Additionally, rising energy and other costs may curtail consumer spending on leisure activities, entertainment, and discretionary purchases, resulting in fewer purchases of our products, including the Jack Daniel’s family of brands, with their broad based consumer appeal.

Changes in consumer preferences and purchases, and our ability to anticipate and react to them affect our business results.

We are a branded consumer products company in a highly competitive market. Our success depends on our continued ability to offer consumers highly appealing products. Consumer preferences and purchases can shift due to a host of factors, including changes in demographic and social trends, public health policies, and leisure, dining, and beverage consumption proclivities. Many other factors could also lead to lower consumer preference for, or spending on, our products, including economic decline, trends toward frugality, war, pandemics, weather, natural or man-made disasters, competitor actions, security threats, or terrorist attacks, for example. To continue to succeed we must anticipate and respond effectively to shifts in consumer behavior and drinking tastes.

The Jack Daniel’s family of brands has been the primary driver of our incremental growth for many years, and our current growth projections for fiscal 2012 and beyond rely on this trend to continue. Therefore, any significant or sustained decline in sales or selling price of our Jack Daniel’s products could materially depress our financial results. More broadly, if we experienced a significant consumer shift in any of our major markets away from spirits, our premium brands, or our ready-to-drink and ready-to-pour products, our financial results likely would be affected adversely. We believe that new products, line extensions, label and bottle changes, product reformulations, and similar product innovations by both us and our competitors will compete increasingly for consumers’ share of stomach. Product innovation is a significant aspect of our growth strategies; however, there can be no assurance that we will continue to develop and implement successful line extensions, packaging, formula changes, or new products. Unsuccessful implementation or short-lived popularity of our product innovations may result in inventory write-offs and other costs, and may also decrease consumer perception of the brand family or parent brand. Our inability to attract consumers to our product innovations relative to our competitors’ products and to continue to do so over time, likely would affect negatively our growth, business performance and financial results over time.

National and local governments may adopt regulations or undertake investigations that could increase our expenses or limit our business activities.

Our business is subject to extensive governmental legislative and regulatory requirements regarding production, importation, marketing and promotion, labeling, distribution, trade, and pricing practices. Changes in related laws, regulatory measures, governmental policies, or in the manner in which current ones are interpreted, could cause Brown-Forman to incur material additional costs or liabilities, and jeopardize the growth of the business. Governments may impose or increase limitations on advertising and promotional activities; place restrictions on retail outlets or other locations, times or occasions where beverage alcohol may be sold or consumed; or adopt other measures that could directly or indirectly limit our opportunities to reach consumers and sell of our products.

For example, the Federal Trade Commission has called for the beverage alcohol industry to move voluntarily to a minimum 85% adult demographic advertising placement standard in the U.S., from the current 70%.  The Russian government is considering restoring the state monopoly on beverage alcohol to combat that country’s excessive consumption.  In Europe, regulators are considering potential bans or severe limitations on the ability to market and sell ready-to-drink products.  If these or other severe regulatory changes are adopted, consumer demand could decline to the point of significantly damaging our business performance and prospects.

In addition, from time to time governmental bodies in the United States and international markets investigate business and trade practices of beverage alcohol producers, distributors, suppliers, and retailers, including their compliance with specific beverage alcohol trade regulations, the U.S. Foreign Corrupt Practices Act, and similar laws in the U.K. and other countries. Our policies and procedures require compliance by our employees and agents with all laws and regulations applicable to our business operations. Nonetheless, despite our policies, procedures and related training programs, governmental investigators may allege or determine that non-compliance has occurred and impose penalties and monetary fines. Thus, adverse developments in or as a result of regulatory measures and governmental investigations could hurt our business operations, reputation and financial results.

Tax increases and changes in tax rules could adversely affect our financial results.

Our business is sensitive to changes in both direct and indirect taxes. As a multinational company based in the United States, Brown-Forman is more exposed to the effects of the various forms of tax changes in the United States than most of our major competitors, especially those changes that affect the net effective corporate income tax rate. Changes that have been proposed in the past (but not enacted) by Congress or the present administration exemplify this risk; they include repealing LIFO (last-in, first-out treatment of inventory), decreasing or eliminating the ability of United States-based companies to receive a tax credit for foreign taxes paid or to obtain a current US tax deduction for certain expenses in the US related to foreign earnings, and increasing the tax on dividends and/or capital gains.

Increases in federal or state excise taxes or other tax increases could also materially depress our financial results, by reducing purchases of our products and encouraging consumers to switch to lower-priced and lower-taxed product categories. While no legislation to increase federal excise taxes on distilled spirits is currently pending in the United States, excise tax increases are possible, as are further increases to other federal tax burdens imposed on the broader business community and consumers. Municipal and state governments may also increase tax burdens to cover budget deficits and compensate for declines in other revenue sources. For instance, in April 2009, Kentucky, where our corporate headquarters is located, subjected wine and spirits products to the 6% state sales tax. Several large states and many more municipalities have various tax increases under consideration that could adversely affect our business and/or consumers of our products. New tax rules, accounting standards or pronouncements, and changes in interpretation of existing ones, could also have a significant adverse effect on our business and financial results.

Our global business can also be negatively affected by increases in tax rates, such as income taxes, excise taxes, value added taxes, import and export duties, tariff barriers, and/or related local governmental economic protectionism, and the suddenness and unpredictability with which these can occur. The recent global economic downturn has increased our tax-related risks in many countries in which we do business, as governmental entities may further increase taxes on beverage alcohol products to replace lost revenues. Even significant income tax increases on consumers could affect our sales results.

 If the social or health acceptability of our products declines or governments adopt policies disadvantageous to beverage alcohol, our business could be materially adversely affected.

Our ability to market and sell our products depends heavily on both societal attitudes toward drinking and governmental policies that flow from those attitudes. In recent years, there has been increased social and political attention directed at the beverage alcohol industry. The recent attention has focused largely on public health concerns related to alcohol abuse, including drunk driving, underage drinking, and the negative health impacts of the abuse and misuse of beverage alcohol. While most people who drink enjoy alcoholic beverages in moderation, it is commonly  known and well reported that excessive levels or inappropriate patterns of drinking can lead to increased risk of a myriad of health risks and, for certain people, can result in alcoholism or dependence. Alcohol industry critics in the United States, Europe and other countries around the world increasingly seek governmental measures to make beverage alcohol products more expensive, less available, and more difficult to advertise and promote. If the social acceptability of beverage alcohol were to decline significantly, sales of our products could decrease materially. Our sales also could suffer if governments ban or restrict advertising or promotional activities, limit hours or places of sale or consumption, or take other actions that discourage alcohol purchase or consumption.

Litigation could expose our business to financial and reputational risk.

Major private or governmental litigation challenging the production, promotion, distribution or sale of beverage alcohol or specific brands, could affect our ability to sell products; and even ultimate vindication can be costly. Several years ago, a series of punitive class action cases were filed against several alcohol companies, including Brown-Forman, alleging that large producers intentionally focused advertising and promotion at under-age consumers.  All of the cases were either dismissed or withdrawn at early stages, but only after considerable effort and expense. Other lawsuits have been brought against beverage alcohol companies for problems related to alcohol abuse, negative health consequences from drinking, or for claimed problems from alleged marketing or sales practices, or underage drinking.  While these lawsuits have been typically unsuccessful in the past, others are possible in the future. We could also experience employment related class actions, product liability actions stemming from a beverage or container production defect, a whistleblower suit, or other major litigation that could adversely affect our business results, particularly to the extent the losses or expenses were not insurable or insured.

Governmental actions around the world to enforce trade practice, anti-corruption, competition, tax, environmental and other laws are also a continuing risk for global companies such as Brown-Forman. As a public U.S. company we are exposed as well to the risk of shareholder class-action suits, particularly following an event that resulted in a precipitous drop in the share price of our stock. Adverse developments in major lawsuits concerning these or other matters could have a material adverse effect on our business.

Production facility disruption may adversely affect our business.

We have a substantial inventory of aged products, principally whiskey and tequila. If there were a catastrophic failure at one of our major distillation or bottling facilities, our business could be adversely affected. The maturing inventories are stored at a handful of different sites, which reduces the risk to a degree; nonetheless, the loss of a substantial amount of aged inventory – through fire, other natural or man-made disaster, contamination, or otherwise – could result in a significant reduction in supply of the affected product or products. Similarly, if we experienced a disruption in the supply of new oak barrels in which to age our whiskies, our business could suffer. A consequence of any of these supply disruptions could be our inability to meet consumer demand for the affected products for a period of time, and other significant adverse business consequences that insurance proceeds may be insufficient to compensate, such as damage to brand equity and future sales from not having our products in the market and in consumers’ sights and hands for this period of time.

Consolidation among, changes in, increased competition by, or poor performance by spirits producers, wholesalers or retailers could hinder the marketing, sale and distribution of our products.

We use a number of different business models to market and distribute our products in different regions of the world. In the United States, we sell our products either to wholesale distributors or, in those states that control alcohol sales, to state governments who then sell them to retail customers and consumers. In our other global markets, we use a variety of route-to-consumer models - including in many markets, reliance on other spirits producers to market and sell our products.  Consolidation among spirits producers overseas, or among wholesalers in the United States, could hinder the distribution and sale of our products as a result of reduced attention and resources allocated to our brands during transition periods, the possibility that our brands may represent a smaller portion of the new business, and/or a changing competitive environment. Also, changes to our route-to-consumer partner or method in important markets could result in temporary sales disruption. Further, while we believe that our size relative to that of our competitors gives us sufficient scale to succeed, we nevertheless face a risk that a continuing consolidation of the large beverage alcohol companies could put us at a competitive disadvantage.

Retailers and wholesalers of our brands offer products that compete directly with ours for shelf space, promotional displays, and consumer purchases. Pricing (including price promotions, discounting, couponing and free goods), marketing, new product introductions, and other competitive behavior by other suppliers, and by distributors and retailers who sell their products against one or more of our brands, could also adversely affect our business and financial results. In tough economic times, consumers tend to be particularly price sensitive and to make more of their purchases in discount stores and other off-premise establishments; therefore, the effects of these competitive activities on our sales may be more pronounced when the economy suffers.

We may not succeed in our strategies for acquisitions and dispositions.

From time to time, we acquire additional brands or businesses. We likely will continue to seek acquisitions that we believe will increase long-term shareholder value, but we cannot assure that we will be able to find and purchase brands or businesses at acceptable prices and terms. It may also prove difficult to integrate acquired businesses and personnel into our existing systems and operations, and to bring them into conformity with our trade practice standards, financial control environment, and U.S. public company requirements. Integration may involve significant expense and management time and attention, and may otherwise disrupt our business. Our ability to increase sales of the brands we acquire profitably will be important to our future performance. For example, our expectations for future profit contribution from the main brands we purchased in the Casa Herradura business depend on our ability to grow the Herradura and el Jimador tequila families of brands in the United States and other markets around the world.

Brand or business acquisitions also may expose us to unknown liabilities, the possible loss of key customers and/or employees most knowledgeable about the acquired business, and risks associated with doing business in countries or regions with less stable governments, political climates, and legal systems and/or economies, among other risks. Acquisitions could also lead us to incur additional debt and related interest expenses, issue additional shares, and become exposed to contingent liabilities, as well as to experience dilution in our earnings per share and reduction in our return on average invested capital. We may incur future restructuring charges or record impairment losses on the value of goodwill and or other intangible assets resulting from previous acquisitions, which may also negatively affect our financial results.

We also evaluate from time-to-time the potential disposition of assets or businesses that may no longer meet our growth, return and/or strategic objectives. In selling assets or businesses, we may not get a price or terms as favorable as we anticipated. We could also encounter difficulty in finding buyers on acceptable terms in a timely manner, which could delay our accomplishment of strategic objectives. Expected cost savings from reduced overhead relating to the sold assets may not materialize, and the overhead reductions could temporarily disrupt our other business operations. Any of these outcomes could hurt our performance.

Counterfeiting, tampering, or contamination of our products or other factors could harm our business.

The success of our branded products relies in large part on the favorable image they enjoy with consumers. Consequently, our business depends on the successful protection of our trademarks and other intellectual property rights. We devote substantial effort to protect our intellectual property rights around the world. We challenge those who imitate our products. Although we believe that our intellectual property rights are legally supported in the markets in which we do business, the protection afforded intellectual property rights varies greatly from country to country. The beverage alcohol industry experiences problems with product counterfeiting and other forms of trademark infringement, especially in Asia and Eastern European markets. Confusingly similar, lower quality, or even dangerous counterfeit product could reach the market and adversely affect our intellectual property rights, brand equity, corporate reputation, and financial results.

Sales of one or more of our products also could diminish due to a scare over product tampering or contamination. Actual contaminations of our products or raw materials used to produce, ferment or distill them, whether deliberately by a third party or accidentally, could lead to inferior product quality and even illness, injury or death to consumers, potential liability claims and loss. Should a product recall become necessary or we voluntarily recalled product in the event of contamination or damage, sales of the affected product or our broader portfolio of brands could be affected adversely.

Negative publicity may affect our stock price and business performance.

Unfavorable media related to our industry, company, brands, marketing, personnel, operations, business performance, or prospects may affect our stock price and the performance of our business, regardless of its accuracy or inaccuracy. Since we are a branded consumer products company, adverse publicity can hurt both our company's stock price and actual operating results, as consumers might avoid brands or products that receive bad press.

Termination of our rights to distribute and market agency brands included in our portfolio could adversely affect our financial results.

In addition to the brands our Company owns, we also market and distribute products on behalf of other brand owners in selected markets, including the United States. Our rights to sell these agency brands are based on contracts with various brand owners, which have varying lengths, renewal terms, termination rights, and other provisions. We earn a margin for these sales and also gain distribution cost efficiencies in some instances. The termination of our rights to distribute agency brands included in our portfolio could adversely affect our financial results.

Regulatory effects resulting from climate change or other environmental issues may negatively affect our operations and financial performance.

While uncertainties exist in the legislative and regulatory processes regarding climate change and other environmental issues, additional regulatory requirements in the United States and other countries may increase our operational costs, due to the higher cost of compliance. New legislation or regulation relating to climate change or other environmental issues could also increase consumer energy prices, which could reduce consumer demand for our beverage alcohol brands.

Item 1B.  Unresolved Staff Comments

None.

Item 2.  Properties

Significant properties are as follows:

Owned facilities:

Office facilities:

Corporate offices (including renovated historic structures) – Louisville, Kentucky

Production and warehousing facilities:

Lynchburg, Tennessee

Louisville, Kentucky

Collingwood, Ontario, Canada

Shively, Kentucky

Woodford County, Kentucky

Windsor, California

Cour Cheverny, France

Amatitan, Mexico

Stave and heading mill in Clifton, Tennessee

Leased facilities:

Manufacturing facility in Dublin, Ireland

Warehousing facilities in Sonoma County, California

Stave and heading mill in Jackson, Ohio

The lease terms expire at various dates and are generally renewable.

We believe that the facilities are in good condition and are adequate for our business.

Item 3.  Legal Proceedings

None.

Item 4.  [Removed and Reserved]

PART II

Item 5.  Market for the Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

Our Class A and Class B Common Stock is traded on the New York Stock Exchange (symbols “BFA” and “BFB,” respectively).  As of April 30, 2011, there were 3,092 holders of record of

Class A common stock and 6,250 holders of record of Class B common stock.

The following table provides information about shares of our common stock that we repurchased during the quarter ended April 30, 2011:

Period	Total Number of Shares Purchased	Average Price Paid per Share	Total Number of Shares Purchased  as Part of Publicly Announced Plans or Programs	Approximate Dollar Value of Shares that May Yet  Be Purchased Under the Plans or Programs
February 1, 2011 – February 28, 2011	--	--	--	--
March 1, 2011 – March 31, 2011	--	--	--	$250,000,000
April 1, 2011 – April  30, 2011	255,539	$68.86	255,539	$232,400,000
Total	255,539	$68.86	255,539

As we announced on March 25, 2011, our Board of Directors has authorized us to repurchase up to $250.0 million of our outstanding Class A and Class B common shares before December 1, 2011, subject to market and other conditions.  All of the shares presented in the above table were acquired as part of this repurchase program.

For the other information required by this item, refer to the section entitled "Quarterly Financial Information" on page 71 of the 2011 Annual Report to Stockholders, which information is incorporated into this report by reference.

Item 6.  Selected Financial Data

For the information required by this item, refer to the section entitled "Selected Financial Data" on page 31 of the 2011 Annual Report to Stockholders, which information is incorporated into this report by reference.

Item 7.  Management's Discussion and Analysis of Financial Condition and Results of Operations

For the information required by this item, refer to the section entitled "Management's Discussion and Analysis" on pages 32 through 48 of the 2011 Annual Report to Stockholders, and the section entitled “Important Information on Forward-Looking Statements” on page 70 of the 2011 Annual Report to Stockholders, which information is incorporated into this report by reference, and the discussion contained in “Item 1A. Risk Factors.”

Item 7A.  Quantitative and Qualitative Disclosures about Market Risk

For the information required by this item, refer to the section entitled "Our Market Risks" on pages 38 and 39 of the 2011 Annual Report to Stockholders, which information is incorporated into this report by reference.

Item 8.  Financial Statements and Supplementary Data

For the information required by this item, refer to the Consolidated Financial Statements, Notes to Consolidated Financial Statements, Reports of Management, and Report of Independent Registered Public Accounting Firm on pages 49 through 69 of the 2011 Annual Report to Stockholders, which information is incorporated into this report by reference.

Item 9.  Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

None.

Item 9A.  Controls and Procedures

The Chief Executive Officer (“CEO”) and the Chief Financial Officer (“CFO”) of Brown-Forman (its principal executive and principal financial officers) have evaluated the effectiveness of the  company's "disclosure controls and procedures" (as defined in Rule 13a-15(e) under the Securities Exchange Act of 1934 (the “Exchange Act”)) as of the end of the period covered by this report.  Based on that evaluation, the CEO and CFO concluded that the company's disclosure controls and procedures: are effective to ensure that information required to be disclosed by the company in the reports filed or submitted by it under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms; and include controls and procedures designed to ensure that information required to be disclosed by the company in such reports is accumulated and communicated to the company’s management, including the CEO and the CFO, as appropriate, to allow timely decisions regarding required disclosure.  There has been no change in the company's internal control over financial reporting during the most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the company's internal control over financial reporting.

For the other information required by this item, refer to “Management’s Report on Internal Control over Financial Reporting” and “Report of Independent Registered Public Accounting Firm” on pages 68 and 69 of the 2011 Annual Report to Stockholders, respectively, which information is incorporated into this report by reference.

Item 9B.  Other Information

None.

PART III

Item 10.  Directors, Executive Officers and Corporate Governance

Executive Officers of the Registrant

		Principal Occupation and
Name	Age	Business Experience
Paul C. Varga	47	Chairman of the Company since August 2007. Chief Executive Officer since August 2005. President and Chief Executive Officer of Brown-Forman Beverages (a division of the Company) from August 2003 to August 2005.
James S. Welch, Jr.	52	Vice Chairman of the Company, Executive Director of Corporate Affairs, Strategy, Diversity, and Human Resources since 2007. Company Vice Chairman, Executive Director of Corporate Strategy and Human Resources from 2003 to 2007.
Donald C. Berg	56	Executive Vice President and Chief Financial Officer since May 2008. Senior Vice President and Director of Corporate Finance from July 2006 to May 2008. President of Brown-Forman Spirits Americas from July 2003 to July 2006.
Matthew E. Hamel	51	Executive Vice President, General Counsel, and Secretary since October 2007. Associate General Counsel and Vice President, Law, of the Enterprise Media Group of Dow Jones & Company, Inc., from December 2006 to October 2007.  Vice President, General Counsel and Secretary of Dow Jones Reuters Business Interactive LLC (d/b/a Factiva) from December 1999 to December 2006.
Jill A. Jones	46	Senior Vice President and Chief Production Officer of the Company since November 2009. Senior Vice President and Managing Director of Global Production from May 2007 to October 2009. Director of Finance, Global Production from July 2006 to April 2007. Vice President and Chief Financial Officer, Brown-Forman Distillery Company and Supply Chain Management from August 2002 to June 2006.
Mark I. McCallum	56	Executive Vice President and Chief Operating Officer of the Company since May 2009. Executive Vice President and Chief Brands Officer from May 2006 through April 2009. Senior Vice President and Chief Marketing Officer from July 2003 to May 2006.
Jane C. Morreau	52	Senior Vice President and Director of Finance, Accounting and Technology since May 2008. Senior Vice President and Controller from December 2006 to May 2008. Vice President and Controller from August 2002 to December 2006.
Kris Sirchio	45	Executive Vice President and Chief Marketing Officer of the Company since November 2009. Global Head, Professional Products, Syngenta AG from October 2004 to September 2009.

For the other information required by this item, refer to the following sections of our definitive proxy statement for the Annual Meeting of Stockholders to be held July 28, 2011, which information is incorporated into this report by reference:  (a) "Election of Directors" on pages 16 through 18 (for information on directors and family relationships); (b) “Code of Conduct and Compliance Guidelines” on page 14 (for information on our Code of Ethics); (c) “Section 16(a) Beneficial Ownership Reporting Compliance” on page 23 (for information on compliance with Section 16 of the Exchange Act); and (d) “Audit Committee” on page 11, and pages 24 through 26.  Also, see the information with respect to "Executive Officers of the Registrant" under Part I of this report, which information is incorporated herein by reference.

Item 11.  Executive Compensation

For the information required by this item, refer to the following sections of our proxy statement for the Annual Meeting of Stockholders to be held July 28, 2011, which information is incorporated into this report by reference: (a) “Executive Compensation" on pages 27 through 59; and (b) “Compensation Committee Interlocks and Insider Participation” on page 61.

Item 12.  Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

Equity Compensation Plan Information

In July 2004, shareholders approved the 2004 Omnibus Compensation Plan as the successor to both the 1994 Omnibus Compensation Plan providing equity awards to employees and the Non-Employee Directors (“NED”) Plan providing equity awards to non-employee directors.  At the time the NED Plan was discontinued, it had not been submitted to shareholders.  The following table provides information on these plans as of the end of the most recently completed fiscal year:

Plan category	Number of securities to be  issued upon exercise of outstanding  options, warrants and rights	Weighted-average exercise  price of outstanding options, warrants and rights(1)	Number of securities remaining  available for future issuance under equity compensation plans(2)
Equity compensation plans approved by security holders	3,650,336	$45.97	4,265,450
Equity compensation plans not approved by security holders	55,166	$27.93	-- (3)
Total	3,705,502	$45.69	4,265,450

(1) Grant prices were equal to the fair market value of the stock at the time of grant.

(2) Securities available for issuance under the 2004 Omnibus Compensation Plan include stock, stock options, stock appreciation rights, market value units, and performance units.

(3) No further awards can be made under the NED Plan.

For the other information required by this item, refer to the section entitled "Stock Ownership" on pages 19 through 23 of our proxy statement for the Annual Meeting of Stockholders to be held July 28, 2011, which information is incorporated into this report by reference.

Item 13.  Certain Relationships and Related Transactions, and Director Independence

For the information required by this item, refer to the following sections of our definitive proxy statement for the Annual Meeting of Stockholders to be held July 28, 2011, which information is incorporated into this report by reference:  (a) "Certain Relationships and Related Transactions" on pages 60 and 61; and (b) "Independent Directors" on page 9.

Item 14.  Principal Accountant Fees and Services

For the information required by this item, refer to the sections entitled "Fees Paid to Independent Registered Public Accounting Firm" and “Audit Committee Pre-Approval Policies and Procedures” on pages 25 and 26 of our definitive proxy statement for the Annual Meeting of Stockholders to be held July 28, 2011, which information is incorporated into this report by reference.

PART IV

Item 15.  Exhibits and Financial Statement Schedules

(a)  (1) and (2) - Index to Consolidated Financial Statements and Schedule:

		Reference
			Annual
		Form 10-K	Report to
		Annual Report	Stockholders
		Page	Page(s)
(1)	Incorporated by reference to our Annual Report to Stockholders for the year ended April 30, 2011:
	Consolidated Statements of Operations for the years ended April 30, 2009, 2010, and 2011*	–	49
	Consolidated Balance Sheets at April 30, 2010 and 2011*	–	50
	Consolidated Statements of Cash Flows for the years ended April 30, 2009, 2010, and 2011*	–	51
	Consolidated Statements of Stockholders’ Equity for the years ended April 30, 2009, 2010, and 2011*	–	52
	Consolidated Statements of Comprehensive Income for the years ended April 30, 2009, 2010, and 2011*	–	53
	Notes to Consolidated Financial Statements*	–	54 – 67
	Reports of Management*	–	68
	Report of Independent Registered Public Accounting Firm*	–	69
	Important Information on Forward-Looking Statements	–	70
(2)	Consolidated Financial Statement Schedule:
	Report of Independent Registered Public Accounting Firm on Financial Statement Schedule	S-1	–
	II – Valuation and Qualifying Accounts	S-2	–

All other schedules for which provision is made in the applicable accounting regulations of the Securities and Exchange Commission have been omitted either because they are not required under the related instructions, because the information required is included in the consolidated financial statements and notes thereto, or because they are not applicable.

* Incorporated by reference to Item 8 in this report.

(a)  (3)  -  Exhibits:

       Filed with this report:

Exhibit Index 

13	Brown-Forman Corporation’s Annual Report to Stockholders for the year ended April 30, 2011, but only to the extent set forth in Items 1, 5, 6, 7, 7A, 8 and 9A of this Annual Report on Form 10-K for the year ended April 30, 2011.
21	Subsidiaries of the Registrant.
23	Consent of PricewaterhouseCoopers LLP, independent registered public accounting firm.
31.1	CEO Certification pursuant to Section 302 of Sarbanes-Oxley Act of 2002.
31.2	CFO Certification pursuant to Section 302 of Sarbanes-Oxley Act of 2002.
32	CEO and CFO Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (not considered to be filed).

Previously Filed:

Exhibit Index

2.1	Asset Purchase Agreement, dated as of March 15, 2006, among Chatham International Incorporated, Charles Jacquin et Cie., Inc., the Selling Stockholders and Brown-Forman Corporation, which is incorporated into this report by reference to Brown-Forman Corporation’s Form 10-K filed on June 29, 2006.
2.2	Asset Purchase Agreement, dated as of August 25, 2006, among Jose Guillermo Romo de la Pena, Luis Pedro Pablo Romo de la Pena, Grupo Industrial Herradura, S.A. de C.V., certain of their respective affiliates, Brown-Forman Corporation and Brown-Forman Tequila Mexico, S. de R.L. de C.V., a subsidiary of Brown-Forman Corporation, as amended, which is incorporated into this report by reference to Brown-Forman Corporation’s Forms 8-K filed on August 29, 2006, December 22, 2006, January 16, 2007, and January 22, 2007.
3.1	Restated Certificate of Incorporation of registrant, which is incorporated into this report by reference to Brown-Forman Corporation's Form 10-Q filed on March 4, 2004.
3.2	By-laws of registrant, as amended on May 28, 2009, which is incorporated into this report by reference to Brown-Forman Corporation's Form 8-K filed on May 29, 2009.
4.1	Indenture dated as of April 2, 2007 between Brown-Forman Corporation and  U.S. Bank National Association, as Trustee, which is incorporated into this report by reference to Brown-Forman Corporation's Form  8-K filed on April 3, 2007.
4.2	Form of 5.2% Note due 2012, which is incorporated into this report by reference to Brown-Forman Corporation’s Form 8-K filed on April 3, 2007.
4.3	Officer’s Certificate dated April 2, 2007, pursuant to Sections 1.02, 2.02 and 3.01 of the Indenture Dated as of April 2, 2007, setting forth the terms of the 5.2% Notes due 2012, which is incorporated into this report by reference to Brown Forman Corporation’s Form 8-K filed on April 3, 2007.
4.4	Form of 5% Note due 2014, which is incorporated into this report by reference to Brown-Forman Corporation’s Form 8-K filed on January 9, 2009.
4.5	Officer’s Certificate dated January 9, 2009, pursuant to Sections 1.02, 2.02 and 3.01 of the Indenture Dated as of April 2, 2007, setting forth the terms of the 5% Notes due 2014, which is incorporated into this report by reference to Brown Forman Corporation’s Form 8-K filed on January 9, 2009.
4.6	Form of 2.5% Note due 2016, which is incorporated into this report by reference to Brown-Forman Corporation’s Form 8-K filed on December 16, 2010.
4.7	Officer’s Certificate dated December 16, 2010, pursuant to Sections 1.02, 2.02 and 3.01 of the Indenture Dated as of April 2, 2007, setting forth the terms of the 2.5% Notes due 2016, which is incorporated into this report by reference to Brown Forman Corporation’s Form 8-K filed on December 16, 2010.
10.1	A description of the Brown-Forman Savings Plan, which is incorporated into this report by reference to page 10 of Brown-Forman’s definitive proxy statement filed on June 27, 1996 in connection with its 1996 Annual Meeting of Stockholders.*
10.2	A description of the Brown-Forman Corporation Nonqualified Savings Plan, which is incorporated into this report by reference to Brown-Forman Corporation’s Form S-8 Registration Statement, filed on September 24, 2010.*
10.3	Brown-Forman Corporation Non-Employee Director Deferred Stock Unit Program, which is incorporated into this report by reference to Brown-Forman Corporation’s Form 8-K filed on September 23, 2010.*
10.4	Brown-Forman Corporation 2004 Omnibus Compensation Plan, as amended, which is incorporated into this report by reference to Brown-Forman's proxy statement filed on June 26, 2009, in connection with its 2009 Annual Meeting of Stockholders.
10.5	Brown-Forman Corporation Non-Employee Director Deferred Stock Unit Program, which is incorporated into this report by reference to Brown-Forman Corporation’s Form 8-K filed on September 23, 2010.*
10.6	Form of Restricted Stock Agreement, as amended, which is incorporated into this report by reference to Brown-Forman Corporation’s Form 10-K filed on June 30, 2005.*
10.7	Form of Employee Stock Appreciation Right Award, which is incorporated into this report by reference to Brown-Forman Corporation’s Form 8-K filed on August 2, 2006.*
10.8	Form of Employee Non-Qualified Stock Option Award, which is incorporated into this report by reference to Brown-Forman Corporation’s Form 8-K filed on August 2, 2006.*
10.9	Form of Non-Employee Director Stock Appreciation Right Award, which is incorporated into this report by reference to Brown-Forman Corporation’s Form 8-K filed on August 2, 2006.*
10.10	Form of Non-Employee Director Non-Qualified Stock Option Award, which is incorporated into this report by reference to Brown-Forman Corporation’s Form 8-K filed on August 2, 2006.*
10.11	Summary of Director and Named Executive Officer Compensation.**
10.12	First Amendment to the Brown-Forman Omnibus Compensation Plan Restricted Stock Agreement, which is incorporated into this report by reference to Brown-Forman’s Annual Report on Form 10-K for the year ended April 30, 2007, filed on June 28, 2007.*
10.13	Second Amendment to the Brown-Forman 2004 Omnibus Compensation Plan Restricted Stock Agreement, which is incorporated into this report by reference to Brown-Forman’s Annual Report on Form 10-K for the year ended April 30, 2007, filed on June 28, 2007.*
10.14	Form of Restricted Stock Unit Award, which is incorporated by reference to Brown-Forman Corporation’s Form 10-Q filed on September 4, 2009.
10.15	2010 Form of Employee Stock-Settled Stock Appreciation Right Award Agreement, which is incorporated into this report by reference to Brown-Forman Corporation’s Form 8-K filed on July 23, 2010.*
10.16	2010 Form of Non-Employee Director Stock-Settled Stock Appreciation Right Award Agreement, which is incorporated into this report by reference to Brown-Forman Corporation’s Form 8-K filed on July 23, 2010.*
10.17	2010 Form of Restricted Stock Award Agreement, which is incorporated into this report by reference to Brown-Forman Corporation’s Form 8-K filed on July 23, 2010.*
10.18	2010 Form of Restricted Stock Unit Award Agreement, which is incorporated into this report by reference to Brown-Forman Corporation’s Form 8-K filed on July 23, 2010.*
10.19	Summary of Director and Named Executive Officer Compensation.**
10.20	Brown-Forman Corporation Amended and Restated Supplemental Executive Retirement Plan and First Amendment thereto, which is incorporated into this report by reference to Brown-Forman’s Annual Report on Form 10-K for the year ended April 30, 2010, filed on June 28, 2010.
10.21	Second Amendment to the Brown-Forman Corporation Amended and Restated Supplemental Executive Retirement Plan, which is incorporated into this report by reference to Brown-Forman’s Quarterly Report on Form 10-Q for the quarter ended January 31, 2011, filed on March 9, 2011.
10.22	Five-Year Credit Agreement dated as of April 30, 2007 by and among Brown-Forman Corporation, Brown-Forman Beverages, Europe, LTD, certain borrowing subsidiaries and certain lender parties thereto, Bank of America, N.A., as Syndication Agent and as a Lender, Citicorp North America, Inc., Barclays Bank Plc, National City Bank and Wachovia Bank, National Association as Co-Documentation Agents and as Lenders, JPMorgan Chase Bank, N.A. as Administrative Agent and as a Lender and J.P. Morgan Europe Limited, as London Agent., which is incorporated into this report by reference to Brown-Forman Corporation’s Form 8-K filed on May 2, 2007.
14	Code of Ethics for Senior Financial Officers, which is incorporated into this report by reference to Brown-Forman Corporation’s Form 10-K filed on July 2, 2004.
101	The following materials from Brown-Forman Corporation’s Annual Report on Form 10-K for the fiscal year ended April 30, 2011, formatted in XBRL (eXtensible Business Reporting Language): (a) Consolidated Statements of Operations, (b) Consolidated Balance Sheets, (c) Consolidated Statements of Cash Flows, (d) Consolidated Statements of Stockholders Equity, (e) Consolidated Statements of Comprehensive Income, and (f) Notes to Consolidated Financial Statements.***

* Indicates management contract, compensatory plan or arrangement.

** Incorporated by reference to the sections entitled “Executive Compensation” and “Director Compensation” in the Proxy Statement distributed in connection with our Annual Meeting of Stockholders to be held on July 28, 2011, which is being filed in conjunction with this Annual Report on Form 10-K. (Fiscal 2011 compensation policies with respect to the company’s directors and named executive officers will remain in effect until the company’s Compensation Committee determines fiscal year 2012 compensation at its July 2011 meeting.)

*** Pursuant to Rule 406T of Regulation S-T, the Interactive Data Files in Exhibit 101 hereto are deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, are deemed not filed for purposes of Section 18 of the Securities and Exchange Act of 1934, as amended, and otherwise are not subject to liability under those sections.

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	BROWN-FORMAN CORPORATION (Registrant)
Date:  June 27, 2011	By:	/s/ Paul C. Varga
		Paul C. Varga
		Chief Executive Officer and Chairman of the Company

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities on June 27, 2011 as indicated:

By:	/s/ Geo. Garvin Brown IV
	Geo. Garvin Brown IV
	Director, Chairman of the Board
By:	/s/ Paul C. Varga
	Paul C. Varga
	Director, Chief Executive Officer, and Chairman of the Company
By:	/s/ Patrick Bousquet-Chavanne
	Patrick Bousquet-Chavanne
	Director
By:	/s/ Martin S. Brown, Jr.
	Martin S. Brown, Jr.
	Director
By:	/s/ Bruce L. Byrnes
	Bruce L. Byrnes
	Director
By:	/s/ John D. Cook
	John D. Cook
	Director
By:	/s/ Sandra A. Frazier
	Sandra A. Frazier
	Director
By:	/s/ Richard P. Mayer
	Richard P. Mayer
	Director
By:	/s/ William E. Mitchell
	William E. Mitchell
	Director
By:	/s/ William M. Street
	William M. Street
	Director
By:	/s/ Dace Brown Stubbs
	Dace Brown Stubbs
	Director
By:	/s/ James S. Welch, Jr.
	James S. Welch
	Director
By:	/s/ Donald C. Berg
	Donald C. Berg
	Executive Vice President and Chief Financial Officer
	(Principal Financial Officer)
By:	/s/ Jane C. Morreau
	Jane C. Morreau
	Senior Vice President and Director of Finance, Accounting and Technology
	(Principal Accounting Officer)

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

 ON FINANCIAL STATEMENT SCHEDULE

To the Board of Directors

of Brown-Forman Corporation:

Our audits of the consolidated financial statements and of the effectiveness of internal control over financial reporting referred to in our report dated June 27, 2011 appearing in the 2011 Annual Report to Stockholders of Brown-Forman Corporation and Subsidiaries (which report and consolidated financial statements are incorporated by reference in this Annual Report on Form 10-K) also included an audit of the financial statement schedule listed in Item 15(a)(2) of this Form 10-K.  In our opinion, this financial statement schedule presents fairly, in all material respects, the information set forth therein when read in conjunction with the related consolidated financial statements.

/s/ PricewaterhouseCoopers LLP

PricewaterhouseCoopers LLP

Louisville, Kentucky

June 27, 2011

S-1

BROWN-FORMAN CORPORATION AND SUBSIDIARIES

SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS

For the Years Ended April 30, 2009, 2010, and 2011

(Expressed in millions)

Col. A	Col. B	Col. C(1)	Col. C(2)	Col. D	Col. E
		Additions	Additions
	Balance at	Charged to	Charged to		Balance
	Beginning	Costs and	Other		At End
Description	of Period	Expenses	Accounts	Deductions	of Period
2009
Allowance for Doubtful Accounts	$19	--	--	$4(1)	$15
Accrued Restructuring Costs	--	$12	--	--	$12
2010
Allowance for Doubtful Accounts	$15	--	$1(2)	--	$16
Accrued Restructuring Costs	$12	--	--	$10(3)	$2(4)
2011
Allowance for Doubtful Accounts	$16	$1	$1(2)	--	$18
Accrued Restructuring Costs	$2(4)	--	--	$2(5)	--

(1)  Doubtful accounts written off, net of recoveries.

(2)  Foreign currency translation adjustment charged to accumulated other comprehensive income.

(3)  Employee severance and other special termination benefit payments.

(4)  Consists of estimated present value of special termination benefits to be made to former employees over their remaining lives.

(5)  Special termination benefit payments and amounts reclassified to accrued postretirement benefits.

S-2

EX-13

Exhibit 13

BROWN-FORMAN CORPORATION

SELECTED FINANCIAL DATA

(Dollars in millions, except per share amounts)

Year Ended April 30,	2002	2003	2004	2005	2006	2007	2008	2009	2010	2011
Continuing Operations:
Net sales	$1,618	1,795	1,992	2,195	2,412	2,806	3,282	3,192	3,226	3,404
Gross profit	$849	900	1,024	1,156	1,308	1,481	1,695	1,577	1,611	1,724
Operating income	$326	341	383	445	563	602	685	661	710	855
Income from continuing operations	$212	222	243	339	395	400	440	435	449	572
Weighted average shares used to calculate earnings per share
- Basic	170.8	168.4	151.7	152.2	152.6	153.6	153.1	150.5	147.8	145.6
- Diluted	171.2	168.9	152.5	153.1	154.3	155.2	154.4	151.4	148.6	146.5
Earnings per share from continuing operations
- Basic	$1.24	1.32	1.60	2.23	2.59	2.60	2.87	2.88	3.03	3.92
- Diluted	$1.24	1.32	1.59	2.22	2.56	2.58	2.84	2.87	3.02	3.90
Gross margin	52.5%	50.1%	51.4%	52.7%	54.2%	52.8%	51.6%	49.4%	50.0%	50.7%
Operating margin	20.2%	19.0%	19.2%	20.3%	23.3%	21.5%	20.9%	20.7%	22.0%	25.1%
Effective tax rate	34.1%	33.6%	33.1%	32.6%	29.3%	31.7%	31.7%	31.1%	34.1%	31.0%
Average invested capital	$1,128	1,266	1,392	1,535	1,863	2,431	2,747	2,893	2,825	2,711
Return on average invested capital	19.3%	18.0%	18.5%	23.0%	21.9%	17.4%	17.2%	15.9%	16.6%	21.8%
Total Company:
Cash dividends declared per common share	$0.54	0.58	0.64	0.73	0.84	0.93	1.03	1.12	1.18	2.24
Average stockholders’ equity	$1,241	1,290	936	1,198	1,397	1,700	1,668	1,793	1,870	1,904
Total assets at April 30	$2,016	2,264	2,376	2,649	2,728	3,551	3,405	3,475	3,383	3,712
Long-term debt at April 30	$33	629	630	351	351	422	417	509	508	504
Total debt at April 30	$200	829	679	630	576	1,177	1,006	999	699	759
Cash flow from operations	$249	243	304	396	343	355	534	491	545	527
Return on average stockholders’ equity	18.1%	18.7%	27.1%	25.7%	22.9%	22.9%	26.4%	24.2%	24.0%	30.0%
Total debt to total capital	13.2%	49.4%	38.3%	32.5%	26.9%	42.8%	36.8%	35.5%	26.9%	26.9%
Dividend payout ratio	41.4%	41.1%	38.2%	36.1%	40.0%	36.8%	35.8%	38.9%	38.7%	57.0%

Notes:

1.   Includes the consolidated results of Finlandia Vodka Worldwide, Tuoni e Canepa, Swift & Moore, Chambord, and Casa Herradura since their acquisitions in December 2002, February 2003, February 2006, May 2006, and January 2007, respectively.

2.   Weighted average shares, earnings per share, and cash dividends declared per common share have been adjusted for a 2-for-1 common stock split in January 2004 and a 5-for-4 common stock split in October 2008.

3.   We define return on average invested capital as the sum of net income (excluding extraordinary items) and after-tax interest expense, divided by average invested capital. Invested capital equals assets less liabilities, excluding interest-bearing debt.

4.   We define return on average stockholders' equity as net income applicable to common stock divided by average stockholders' equity.

5.   We define total debt to total capital as total debt divided by the sum of total debt and stockholders' equity.

6.   We define dividend payout ratio as cash dividends divided by net income.

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MANAGEMENT’S DISCUSSION AND ANALYSIS

Below, we review Brown-Forman’s consolidated financial condition and results of operations and present the data to help you understand our business and the context for our results for the fiscal years ended April 30, 2009, 2010, and 2011. We also comment on our anticipated financial performance, discuss factors that may affect our future financial condition and performance, and make other forward-looking statements. Please read this section of our report together with the consolidated financial statements for the year ended April 30, 2011, their related notes, and the important information on forward-looking statements on page 70. There, we list some risk factors that could cause actual results to differ materially from what we currently expect.

EXECUTIVE OVERVIEW

Brown-Forman Corporation is a diversified producer and marketer of high-quality consumer beverage alcohol brands. We are one of the largest American-owned wine and spirits companies, and our products include Tennessee, Canadian, and Kentucky whiskeys; Kentucky bourbon; tequila; vodka; liqueur; California sparkling wine; table wine; and ready-to-drink (RTD) and ready-to-pour (RTP) products. We have more than 25 brands, including Jack Daniel’s and its related brands; Finlandia; Southern Comfort; Herradura; el Jimador; New Mix; Canadian Mist; Chambord; Tuaca; Woodford Reserve; Sonoma-Cutrer; and Korbel Champagne. Our brands are sold in more than 135 countries, and our largest operations are in the United States, Mexico, Australia, the United Kingdom, Germany, and Poland.

OUR STRATEGIES AND OBJECTIVES

The title of our shareholder’s report this year is “Building Forever,” reflecting our long-term perspective and our desire to remain a strong and independent company indefinitely. When we consider the company’s performance in fiscal 2011 and our future outlook, we believe our growth rates will return to those we achieved before the financial crisis and resulting recession that began in 2008.

Brown-Forman’s results over the past three years have been consistent during a difficult time for investors generally. Through the economic downturn, our shareholders received a total shareholder return (TSR) of 13% versus the S&P 500’s TSR of only 2% for the period April 30, 2008 through April 30, 2011. We accomplished this through a focus on organic growth, geographic expansion, careful portfolio management and evolution, strategic cost reductions, and innovation.

In the summer of 2010, we introduced our ten-year strategy, focused on driving sustainable growth with the potential to double the size of our business over the succeeding decade. Our five strategic ambitions remain unchanged:

1.   Continue to expand the Jack Daniel’s family of brands, including Black Label, and make Jack Daniel’s the fastest-growing brand in retail sales among the world’s largest premium spirits brands. We plan to do this by keeping Jack Daniel’s Black Label strong, healthy, and relevant to consumers worldwide, and by taking advantage of the abundant opportunities for growing the current Jack Daniel’s family and future line extensions across countries, price segments, channels, and consumer groups.

2.   Grow the rest of our portfolio at a rate faster than the growth of the Jack Daniel’s brand. To achieve this, we will strive to increase the global footprint of our brands such as Southern Comfort and Finlandia, and expand the reach of our tequila brands, Herradura and el Jimador, and super-premium brands, including Sonoma-Cutrer and Woodford Reserve. Realizing this potential will require us to use innovative products and packaging to seize new business opportunities and to leverage our products into new consumption patterns.

3.   Grow our business in the United States, our largest market, and grow our market share of dollar sales in the U.S. spirits industry as a whole. We expect to do this through stronger participation in fast-growing spirits categories such as vodka and tequila, continued product and packaging innovation, continued route-to-consumer proficiency, and brand building among growing consumer segments.

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4.   Grow our business outside the United States at a faster rate than the United States.  Over the past 15 years, our business outside the United States has grown more quickly than our business within it. We expect this trend to continue, and it is important to our overall growth in this next decade. To realize this strategy, we expect to grow our portfolio in developed economies such as those in France, Australia, the United Kingdom, and Germany and emerging markets such as Poland and Mexico. We will also adjust route-to-consumer strategies to expand our access to and understanding of consumers. And we expect other emerging markets such as Brazil, Russia, India, and China to gain significantly in importance.

5.   Be responsible in everything we do. We try to be responsible in everything we do – from reducing our environmental footprint to managing how we market our brands. We believe this responsibility is a rich source of opportunity: It allows us to build stronger consumer relationships and enduring brands, make our products more efficiently, enhance our business efforts, and maintain the trust required for our commercial freedoms. Corporate responsibility includes our civic obligations and our products’ entire environmental life cycles: how we produce or source our raw materials, how we set and maintain production standards, and how we package and distribute our products. Environmental stewardship is central to our broader social responsibilities, as is our commitment to contribute to the quality of life in the communities where our employees live, work, and raise their families.

OUR OPERATIONS AND OUR MARKETS

We employ around 3,900 people on six continents. Our headquarters is in Louisville, Kentucky, USA, where we employ about 1,000 people. We have major sales and marketing operations in Louisville, London, Sydney, Hamburg, Guadalajara, and Warsaw as well as sales offices located in over 25 other cities around the globe.

Our production facilities include distillery production in Louisville and Versailles, Kentucky; Lynchburg, Tennessee; and Collingwood, Ontario. Our main tequila production facility is at Casa Herradura in Amatitán, Mexico. We also have production facilities in Cour Cheverny, France; Dublin, Ireland; and Windsor, California, and contract production in Australia, Belgium, Finland, Ireland, Mexico, the Netherlands, South Africa, and the United States.  Our Brown-Forman Cooperage operation in Louisville is the world’s largest producer of whiskey barrels.

We operate distribution companies in a number of markets where we sell directly to retailers and wholesalers. These include Australia, Brazil, Canada, China, the Czech Republic, Germany, Korea, Mexico, Poland, and Taiwan.

Over the last 10 years, we have made tremendous strides in expanding our international footprint. Today, we sell our brands in more than 135 countries and generate 55% of our net sales outside the United States. The United States remains our largest, most important market, contributing 45% of our net sales in fiscal 2011, compared to 47% in fiscal 2010. Our reported net sales in the United States were flat for fiscal 2011, while growing at about 11% elsewhere on an as-reported basis and 7% on a constant-currency basis. (“Constant-currency,” a non-GAAP measure, represents reported net sales with the effect of currency fluctuations removed. We calculate constant currency by translating current year results at prior year rates.  We present our sales data on a constant-dollar basis because exchange rate fluctuations can distort the underlying1 change in sales, either positively or negatively.)

	2001	2011
Net Sales Contribution:
United States	77%	45%
International	23%	55%

Europe, our second-largest region, accounted for 27% of our net sales in both fiscal 2011 and fiscal 2010. For fiscal 2011, net sales in Europe were up about 3% on an as-reported basis. After adjusting for the effects of a stronger dollar, net sales in Europe were up 5%. Overall trading conditions for the industry improved modestly in some parts of Europe but remained weak in others as consumers remained cautious regarding the economic outlook. Many Western European economies continued to struggle in fiscal 2011, including those in Spain, Italy, Greece, and Ireland, where overall consumption dropped again. Many countries in Eastern Europe experienced improving trends, but consumers in some countries there continued to trade down from premium imported spirits. Despite the tough economic conditions overall, our business continued to expand across Europe, with broad-based gains in a number of markets (most notably, the United Kingdom, Turkey, Germany, and France).  Our flagship brand, Jack Daniel’s, continued to grow market share in European countries, including the United Kingdom, France, Spain, Italy, Poland, Greece, and Romania.

1 Underlying change, a non-GAAP measure, represents the percentage increase or decrease in reported financial results in accordance with generally accepted accounting principles in the United States, adjusted for certain items. We believe providing underlying change provides a framework to assess how our business performed relative to prior periods.

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Net sales for the rest of the world other than the United States and Europe constituted 28% of our total sales, where sales grew year over year 19% in fiscal 2011 on an as-reported basis and 9% on a constant-currency basis. This growth was driven by continued expansion of our portfolio in Australia and Mexico, by the benefits of the route-to-consumer change made during fiscal 2011 for Brazil, and growth in a number of Asian and other Latin America countries.

Fiscal 2011 Net Sales by Geography:
United States	45%
Europe	27%
Rest of the world	28%

Our main international markets include Australia, the United Kingdom, Mexico, Poland, Germany, France, Canada, Japan, Spain, Turkey, South Africa, Russia, Italy, and China. We continue to see significant long-term growth opportunities for our portfolio of brands in both developed and emerging markets, particularly in Eastern Europe, Asia, and Latin America.

The more we expand our business outside the United States, the more our financial results will be exposed to exchange rate fluctuations. This exposure includes sales of our brands in currencies other than the dollar and the cost of goods, services, and manpower we purchase in currencies other than the dollar. (In this report, “dollar” always means the U.S. dollar.) Because we sell more in local currencies than we purchase, we have a net exposure to changes in the dollar’s value. To buffer these exchange rate fluctuations, we regularly hedge a portion of our foreign currency exposure. But over the long term, our reported financial results will generally be hurt by a stronger dollar and helped by a weaker dollar.

During fiscal 2011, the overall global economic environment improved. We began to see the U.S. on-premise activity in restaurants and bars stabilize but did not see a real return to growth, as consumers continued to shift to more at-home consumption and dining. We started to see evidence of U.S. consumers beginning to trade up in the latter part of our fiscal year to super-premium and premium brands, providing us with some encouraging signs for the future.  Distributors’ and retailers’ inventory levels around the world seemed to stabilize after declining during the economic crisis.  While economists are generally projecting GDP growth in most countries, we believe the macro environment will remain volatile, and cost increases attributed to rising inflation and higher fuel costs could constrain our performance in the near term. Nevertheless, we believe the long-term growth potential for high-quality spirits remains positive due to favorable demographic trends and continued consumer desire for premium brands. This is particularly true in many emerging markets where Western-style premium brands are aspirational.

OUR BRANDS

Our objectives for growing sales and earnings are based on expanding the reach of our brands geographically, introducing new brand offerings, acquiring brands, increasing prices, and divesting non-core and under-performing assets. Over the past several years, we have made significant advances in each area, including:

·   expanding international sales;

·   developing new flavors in the vodka, ready-to-drink (RTD) and read-to-pour (RTP) categories;

·   acquiring the Casa Herradura2 tequila brands and Chambord liqueur in fiscal 2007;

·   increasing prices strategically;

·   completing the divesture of our consumer durables business in fiscal 2007; and

·   divesting our Italian wine brands, Bolla and Fontana Candida, in fiscal 2009.

We built on these objectives in fiscal 2011 as we achieved record earnings by:

·   continuing our international growth;

·   developing new packaging and flavors for a number of brands in our porfolio;

·   leveraging our existing assets by introducing several of the brands in our portfolio, including RTD offerings, in a number of markets around the world;

·   introducing innovative brands and line extensions such as Jack Daniel’s Tennessee Honey and Chambord Flavored Vodka; and

·   divesting of the Hopland-based wine3 business to Chilean wine producer Viña Concha y Toro S.A. in April 2011.

Total depletions (shipments direct to retailers or from distributors to wholesalers and retailers) for the active brands in our portfolio were 36 million nine-liter cases, up 3% over the volumes in fiscal 2010 for comparable brands. Nine of our brands experienced depletions of more than one million nine-liter cases in fiscal 2011.

Jack Daniel’s Tennessee Whiskey is the signal brand in our portfolio and one of the largest, most profitable spirits brands in the world. Global depletions for Jack Daniel’s were up 4% in fiscal 2011, an improvement from its 2% growth in fiscal 2010. The brand registered flat volumes in its largest market, the United States, and 4% growth in the United Kingdom.  Jack Daniel’s experienced double-digit depletion gains in several markets, including France, Poland, Turkey, Mexico, the Netherlands, and travel retail (formerly “duty free”) with single-digit growth across many more markets, including Germany, Italy, and Canada.

2 Brands include el Jimador, Herradura, New Mix (a tequila-based RTD product), Antiguo, and Suave 35.

 

3Included in this sale were the Fetzer winery, bottling facility, and vineyards, as well as the Fetzer brand and other Hopland, California-based wines, including Bonterra, Little Black Dress, Jekel, Five Rivers, Bel Arbor, Coldwater Creek, and Sanctuary. Also included in the sale was a facility in Paso Robles, California. This divestiture is referred to as “Fetzer sale” throughout this report.  See Note 14 to our consolidated financial statements for details of this sale.

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Jack Daniel’s outpaced the combined growth of the top 100 spirits brands (according to a February 2011 report by Impact Databank, a New York industry research group) while maintaining its share in the top five premium global spirits brands.  These achievements underscore the brand’s iconic image while reinforcing our belief in its long-term appeal and sustained growth potential.

Because Jack Daniel’s generates a significant percentage of our total net sales and earnings, it remains a top priority, vital to our overall performance. Any significant decline in Jack Daniel’s volume or selling price, particularly over an extended time, could materially depress our earnings. We remain encouraged by the brand’s resilience over the past two years in the face of a challenging environment and the opportunities for continued growth in both emerging and developed markets.

The Jack Daniel’s family of brands, which includes Jack Daniel’s Tennessee Whiskey, Gentleman Jack, Jack Daniel’s Single Barrel, Jack Daniel’s Tennessee Honey, and RTD products such as Jack Daniel’s & Cola, Jack Daniel’s & Diet Cola, Jack Daniel’s & Ginger, and Jack Daniel’s Country Cocktails, grew volumes 8% globally on a nine-liter case basis in fiscal 2011 and 5% on a drinks-equivalent basis. (Equivalent depletions represent the conversion of single-serve RTD brands to a similar drink equivalent as the parent brand. RTD nine-liter case volume is divided by 10.) Net sales of the brand family grew 10% on an as-reported basis and 8% on a constant-currency basis. Jack Daniel’s line extensions grew at a faster rate than Jack Daniel’s Tennessee Whiskey itself.

The benefit of our repackaging of Gentleman Jack, launched in fiscal 2007, and the geographic expansion of the brand to markets outside the United States continued in fiscal 2011, as volumes grew nearly 9%, and net sales grew over 13% on an as-reported basis and 12% on a constant-currency basis. Jack Daniel’s Single Barrel in fiscal 2011 depletions grew 12% after a 14% increase in fiscal 2010, reflecting the expansion of this brand in markets outside the United States. Net sales for the brand increased 7% on both an as-reported and constant-currency basis.

Impressive growth continued in fiscal 2011 for the Jack Daniel’s RTD brands, where depletions grew 17% on a nine-liter basis in fiscal 2011 (on top of a 39% increase in fiscal 2010), and net sales increased 28% on an as-reported basis and 18% on a constant-currency basis. This growth was fueled by strong gains in Australia and Germany and the expansion of the products into Europe, Mexico, and North America. We believe Jack Daniel’s RTDs will continue to provide a growth opportunity for us, as they offer not only an appealing, great-tasting, convenient expression of the brand but also an effective marketing tool for the parent brand.

In the United States, we introduced a new line extension late in fiscal 2011, Jack Daniel’s Tennessee Honey, the first such extension for Jack Daniel’s in over a decade.  We are optimistic about the potential for this line extension as it has experienced a positive initial reception to the market by our distributor partners, the retail trade, and our consumers.

Finlandia and Southern Comfort are our two next-most-important brands. In Fiscal 2011, Finlandia gained share in its largest market, Poland, and in several other eastern European markets, but experienced market declines in Russia due to the initial disruption associated with the transition to a new distributor there. The brand also lost market share in the United States. Global net sales for Finlandia declined 2% on both an as-reported and constant-currency basis.

Southern Comfort had another difficult year, as depletions declined 6% in fiscal 2011. Net sales declined 3% in fiscal 2011 on an as-reported basis and 5% on a constant-currency basis. The brand continued to be hurt by increased competition from flavored whiskeys, flavored vodkas, and spiced rums, particularly those often consumed on premise in shots.

To reinvigorate the brand’s growth and to realize our objective of expanding our existing trademarks into new business opportunities, we introduced Southern Comfort Lime in the United States during fiscal 2011. We are encouraged by the early performance of this line extension. When combined with the parent brand and RTP expressions, the overall brand family depletions on a nine-liter case basis declined 3%. In fiscal 2012, we intend to explore new consumer opportunities, to introduce additional line extensions into the brand family, and to expand Southern Comfort Lime into markets outside the United States.

In fiscal 2011, we continued to expand the geographic footprint of the tequila and tequila-based brands acquired as part our fiscal 2007 Casa Herradura acquisition. el Jimador, the #1 selling tequila brand in Mexico, grew depletions 8% globally, including 6% in Mexico, its largest market, and 17% in the United States. Soon after introducing a new label and new bottle carton for the super-premium Herradura brand during fiscal 2010, we introduced as planned stage two of the evolution of the brand’s premium image, a new package for the brand in fiscal 2011. The brand’s depletion trends have accelerated, growing double digits globally for the fiscal year compared to more modest gains in fiscal 2010.

One way we are leveraging our tequila assets is by continuing to introduce the portfolio in markets around the world. We believe our tequila brands have considerable potential for future growth both in the United States and elsewhere. We plan to further expand our tequila brands geographically in fiscal 2012 and to introduce line extensions and new flavors for New Mix, tequila-based RTD brands.

Depletion trends for Korbel Champagne grew while depletions for our mid-priced brands generally declined in fiscal 2011, including those for Canadian Mist and Early Times. These are largely off-premise-driven brands in fiercely price-competitive segments. We expect longer-term growth for most of these brands to be modest.

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Most of our brands in the super-premium price category continued to grow throughout the economic crisis. Woodford Reserve, Sonoma-Cutrer, and Chambord all posted depletion gains in fiscal 2011. We remain encouraged by the resilience of these small-but-growing super-premium brands and expect to see more growth opportunities as the global economy continues to improve.

OUR DISTRIBUTION NETWORK AND OUR CUSTOMERS

To expand the reach of our brands around the world, we need to ensure that consumers can find our products whenever and wherever they seek a premium beverage alcohol brand. To broaden access, we use a variety of distribution models around the world based on (1) the market’s long-term attractiveness and competitive dynamics and (2) our portfolio’s stage of development in that market. We choose the most appropriate model to optimize our access to consumers in that market at that time, but that choice can evolve as market dynamics change and as our portfolio matures.

We own and operate distribution networks in a handful of markets, including Australia, Brazil, Canada, China, the Czech Republic, Germany, Korea, Mexico, Poland, and Taiwan; we plan to review other countries in fiscal 2012. In all of these markets, we sell our products directly to retail stores or to wholesalers. In the United Kingdom, we partner in a cost sharing arrangement with another supplier, Bacardi, to sell a combined portfolio of our companies’ brands.

In fiscal 2011, we expanded the number of markets where we own our distribution to include Germany, Canada, and Brazil, and we expanded our cooperation with Coca-Cola Hellenic Bottling (CCHB) to include Russia. CCHB is also our distributor in Croatia, Hungary, Slovenia, and Ukraine. While we experienced disruption during the transition to this new distributor in Russia, which did not materially affect our fiscal 2011 earnings, we anticipate that we will be able to leverage their distribution prowess to further develop our brands in the retail trade in the important Russian market.

In the United States, we sell our portfolio of brands either to wholesalers or (in states that directly control alcohol sales) to state governments that then sell to retail customers and consumers. In some markets we have distribution contracts; these contracts typically have no fixed term and are terminable at will with a liquidated damages provision that provides limited compensation based primarily on a percentage of purchases over time. Some state franchise statutes limit our ability to terminate our distribution relationships.

In many other markets not discussed above, including France, Spain and Italy, we rely significantly on others to distribute our brands.

While to date it has happened only rarely, consolidation among wholesalers in the United States or among spirits producers around the world could hinder the distribution of our products in the future as a result of reduced attention to our brands, the possibility that our brands may constitute a smaller portion of their business, or a changing competitive environment.

We expect to continue to pursue strategies and partnerships that will improve our in-market brand-building efforts. But in the short term, if we change our route-to-consumer in a market, we could experience temporary sales disruptions, transition expenses, and costs of establishing infrastructure that more than offset initial margin gains.

OUR COMPETITION

We operate in a highly competitive industry. We compete against many global, regional, and local brands in a variety of categories of beverage alcohol, but most of our brands compete primarily in the industry’s premium end. Trade information indicates that we are one of the largest suppliers of wine and spirits in the United States. While the industry has consolidated considerably over the last decade, the 10 largest global spirits companies on a volume basis, according to International Wine & Spirit Research for calendar year end 2010, control around 20% of the total global market for spirits, and in Asia their share is less than 18%. We believe that the overall market environment offers considerable growth opportunities for exceptional builders of high-quality wine and spirits brands.

OUR BUSINESS ENVIRONMENT

Brown-Forman’s long-term prospects are excellent. Our company remains a relatively small player on the global scene with a wide variety of geographic and brand growth opportunities around the world.  We anticipate the demand for spirits and wine to continue to grow in most of our largest markets over the medium and long term. Favorable demographic trends in the United States (through 2014), Asia, and other markets encourage us as well.

We see enormous potential for our brands to continue to grow in the global marketplace. Markets outside the United States accounted for only about 23% of our net sales in fiscal 2001; today our international business contributes 55% to our net sales. Our global market share of spirits is about 1%. We see great opportunities for growth not only in emerging markets (such as Brazil, Russia, India, and China) but also in economically developed ones (such as the United Kingdom, France and Australia), which our major competitors classify as mature markets.

Several of our major brands have enjoyed long lives, and we believe they can continue to grow for decades to come. (For example, Jack Daniel licensed his distillery in 1866, and the Herradura and Old Forester brands originated in 1870). The beverage alcohol business (especially the premium brands in our portfolio) provides exceptional gross profit margins and good returns. We also expect our brand innovations to contribute to our growth.

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Public attitudes; government policies. While we are very optimistic about ourgrowth opportunities, our ability to market and sell our products depends heavily on society’s attitudes toward drinking and government policies. A number of organizations blame alcohol manufacturers for the problems associated with alcohol misuse. Some critics claim that beverage alcohol companies intentionally market their products to encourage underage drinking. Legal or regulatory measures directed in response against beverage alcohol (including its advertising and promotion) could adversely affect our sales and business prospects.

Illegal alcohol consumption by underage drinkers and abusive drinking by a minority of adult drinkers give rise to public issues of great significance. Alcohol industry critics seek governmental measures to make beverage alcohol more expensive, less available, and more difficult to advertise and promote. We believe these strategies are ineffective and ill-advised. In our view, society is more likely to curb alcohol abuse by better educating consumers about beverage alcohol and moderate drinking than by restricting alcohol advertising and sales, or by imposing punitive taxes.

We strongly oppose underage and abusive drinking. We carefully target our products only to adults of legal drinking age. We have developed a comprehensive internal marketing code and also adhere to marketing and advertising guidelines of the U.S. Distilled Spirits Council, the Wine Institute, and the European Forum for Responsible Drinking, among others. We contribute significant resources to The Century Council, an organization that we and other spirits producers created in the early 1990s to combat alcohol misuse including drunk driving and underage drinking. We actively participate in similar organizations in our other markets.

Regulatory measures against our industry are of particular concern in Europe, where many countries are considering more restrictive alcohol policies, such as potential bans or severe limitations on ready-to-drink products.

The World Health Assembly (the governing body of the World Health Organization) recently approved a global strategy on combating the harmful use of alcohol. The strategy contains a menu of policy options that member states can tailor to their cultures and context. Importantly, the strategy recognizes the beverage alcohol industry as a legitimate stakeholder and puts the focus on reducing “harmful” or “excessive” use and abuse and not on drinking per se. We view this development as largely positive.

An important commitment of the beverage alcohol industry is the implementation of the Global Actions on Harmful Drinking in the areas of preventing drunk driving, increasing uptake of self-regulation, and fighting non-commercial alcohol. The International Center for Alcohol Policies (ICAP), a not-for-profit organization, is managing this significant effort, just getting under way in 18 countries. Major producers of beverage alcohol, including Brown-Forman, are supporting this initiative.

Policy objectives. Broadly speaking, we seek two things:

1.   recognition that beverage alcohol should be regarded like other products that have inherent benefits and risks, and

2.   equal treatment for distilled spirits, wine, and beer - all forms of beverage alcohol - by governments and their agencies.

We recognize that beverage alcohol, when misused or abused, can contribute to social and health issues. But we also believe strongly that beverage alcohol should be viewed like other consumer products - such as food and motor vehicles - that can also be hazardous if misused. Beverage alcohol plays an important part in enriching the lives of the vast majority of those who choose to drink. That is why we stress responsible consumption as we promote our brands. It is also why we discourage underage drinking and irresponsible drinking, including drunk driving. We believe that the optimal way to discourage alcohol misuse and abuse is by partnering with parents, schools, law enforcement, and other concerned stakeholders.

Distilled spirits, wine, and beer are all forms of beverage alcohol, and we believe governments should treat them equally. But generally, and especially in the United States, distilled spirits are taxed far more punitively than beer per ounce of alcohol, and are subject to tighter restrictions on where and when consumers can buy them. Compared with beer and wine, distilled spirits are also denied the right to advertise in some venues. Achieving greater cultural acceptance of our products and parity with beer and wine in having access to consumers is a major goal that we share with other distillers. We seek both fairer distribution rules (such as Sunday sales in those U.S. states that still ban them) and laws that permit product tasting, so that consumers can sample our products and buy them more easily. We encourage rules that liberalize international trade, so that we can expand our business more globally. As we explain below, we oppose tax increases that make our products more expensive for consumers, and seek to reduce the tax advantage that beer currently enjoys.

Taxes.  Recent proposals in the United States, at both the state and federal levels, to increase taxes on beverage alcohol to generate revenue are of considerable concern. Beverage alcohol is already taxed separately and substantially through state and federal excise taxes (FET), above and beyond corporate income taxes on their producers. Some U.S. states also charge sales tax on distilled spirits, even though they already collect state excise taxes. The U.S. FET for spirits per ounce of pure alcohol is twice that for beer. Besides placing a disproportionate tax burden on spirits, any FET increase would have a negative economic effect on the hospitality industry and its millions of workers. Depending on the states affected and the amount of the increase, state tax increases could negatively affect our business results significantly as well.

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In 2010 (according to a February 2011 report by Impact Databank), only three of the top ten global spirits companies were based in the United States. Several former U.S.-based beverage companies have been acquired by foreign companies over the years and shifted employment and trademark ownership to countries with more favorable tax regimes. We estimate that our fiscal 2012 effective corporate income tax rate will be about 33%, compared to recent effective rates ranging from 9.5% to 21.3% for our largest foreign competitors. Obviously this is a significant economic disadvantage for us. Current discussions in the U.S. Congress about income tax reform make it very difficult to predict the future income tax environment for us.

The U.S. Congress has also raised the possibility of repealing the LIFO (last-in first-out) treatment of inventory, an accepted tax and accounting practice in the United States for over 70 years. We strongly oppose this repeal because LIFO is designed to minimize artificial inflation gains and to reflect replacement costs accurately. LIFO is particularly important to companies like ours, whose aging process requires some distilled spirits to be held in inventory for several years before being sold. As contemplated, LIFO repeal would also result in an unprecedented “recapture” of tax benefits received in prior years - in effect, a retroactive tax increase.

We also face the risk of increased tax rates and tax law changes in many of our international markets as well. This risk increases as we expand the scale of our business outside the United States, as governments impose austerity measures to cope with economic difficulties, such as in several European countries, and as some countries consider using increased taxation to generate revenue or discourage excess consumption.

OUR MARKET RISKS

We are exposed to market risks arising from adverse changes in commodity prices affecting the cost of our raw materials and energy, foreign exchange rates, and interest rates. We try to manage risk responsibly through a variety of strategies, including production initiatives and hedging strategies. Our foreign currency hedging contracts are subject to changes in exchange rates, our commodity futures and option contracts are subject to changes in commodity prices, and some of our debt obligations are subject to changes in interest rates. We discuss these exposures below and also provide a sensitivity analysis as to the effect the changes could have on our results of operations.

See Note 4 to our consolidated financial statements for details on our grape and agave purchase obligations, which are exposed to commodity price risk, and “Critical Accounting Estimates” for a discussion of our pension and other postretirement plans’ exposure to interest rate risks.

See “Important Information on Forward-Looking Statements” (page 70) for details on how economic conditions affecting market risks also affect the demand for and pricing of our products.

Foreign Exchange.  Foreign currencies’ strength relative to the U.S. dollar affects sales and the cost of purchasing goods and services, including advertising, selling, general, and administrative expenses, in our markets. We estimate that our foreign currency revenue will exceed our foreign currency expenses by approximately $600 million in fiscal 2012. Foreign exchange rates also affect the carrying value of our foreign-currency-denominated assets and liabilities.

If we did not hedge these foreign currency exposures, our results of operations and financial position would improve when the U.S. dollar weakens against foreign currencies and decline when the U.S. dollar strengthens against them. But we routinely use foreign currency forward and option contracts to hedge our transactional foreign exchange risk and, in some circumstances, our net asset exposure. If these contracts remain effective, we will not recognize any unrealized gains or losses until we either recognize the underlying hedged transactions in earnings or convert the underlying hedged net asset exposures. At April 30, 2011, our total foreign currency hedges had a notional value of $392 million, with a maximum term outstanding of 24 months, and a negligible net unrealized gain.

As of April 30, 2011, we hedged approximately 40% of our total transactional exposure to foreign exchange fluctuations in 2012 for our major currencies by entering into foreign currency forwards and option contracts. Considering these hedges, we estimate that a 10% increase in the average value of the U.S. dollar in 2012 relative to the fiscal 2011 effective exchange rates for our significant currency exposures would reduce our fiscal 2012 operating income by approximately $50 million. Conversely, a 10% decline in the value of the U.S. dollar relative to fiscal 2011 effective rates would increase our fiscal 2012 operating income by approximately $30 million.

Commodity Prices. Commodity prices are affected by weather, supply and demand, and other geopolitical and economic variables. We use futures contracts and options to reduce corn’s price volatility. At April 30, 2011, we had outstanding derivative contracts on approximately three million bushels of corn with net unrealized gains of $5 million. We estimate that a 10% decrease in corn prices would reduce the net unrealized gain at April 30, 2011, by $2 million. We expect to mitigate the effect of some of the increases in our raw material costs through our hedging strategies, ongoing production and cost saving initiatives, and targeted increases in prices for our brands.

Our comprehensive environmental sustainability strategy includes provisions for assessing climate change risks related to the availability and prices of our key agricultural inputs, including grains, agave, and grapes, and to adopt mitigation measures where appropriate.  We are also developing a process for assessing risks related to water availability and quality.  In concert with these measures, we have set clear goals to improve water and energy efficiency, increase the use of renewable energy, minimize greenhouse gas emissions, and reduce waste throughout our products’ lifecycles, which we believe will improve our business operations.

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Interest Rates. Our cash and cash equivalents, variable-rate debt, and fixed-to-floating interest rate swaps are exposed to the risk of changes in interest rates. Based on the April 30, 2011, net balance of these items, a one-percentage-point point decrease in interest rates would increase our annual interest expense (net of interest income on cash and equivalents) by $2 million.

OUR FISCAL 2012 EARNINGS OUTLOOK

We expect the global economic environment and consumer trends to continue to improve in fiscal 2012. But uncertainties exist as we start fiscal 2012, including ongoing volatile macroeconomic conditions, higher commodity and fuel prices, changes in distributor and retail inventory levels, consumer response to innovation activities, and volatility in foreign exchange rates. Given these uncertainties, we are establishing a $0.40 guidance range of $3.45 to $3.85 for our fiscal 2012 diluted earnings per share.  This compares to fiscal 2011 earnings per share of $3.41 (excluding the $0.26 per diluted share gain on the Fetzer sale, the absence of a net $0.16 per diluted share associated with profits from the Fetzer sale, and $0.07 per diluted share for discrete tax benefits). We anticipate fiscal 2012 underlying operating income growth in the mid-to-high-single digits.

RESULTS OF OPERATIONS

Our total diluted earnings per share were $3.90 for fiscal 2011. Our business includes strong brands representing spirits such as whiskey, bourbon, vodka, tequila, and liqueur, as well as wine and champagnes. The largest market for our brands is the United States, which generally prohibits wine and spirits manufacturers from selling their products directly to consumers. Instead, we sell our products to wholesale distributors or state-owned operators, who then sell the products to retailers, who in turn sell to consumers. We use a similar tiered distribution system in many markets outside the United States, but we distribute our own products in several markets, including Australia, Brazil, China, the Czech Republic, Germany, Korea, Mexico, Poland, and Taiwan.

Distributors and retailers normally keep some of our products in inventory, so retailers can sell more (or less) of our products to consumers than distributors buy from us during any given period. Because we generally record revenues when we ship our products to distributors, our sales for a period do not necessarily reflect actual consumer purchases during that period. Ultimately, consumer demand determines the underlying health and financial results of our brands and business. The beverage alcohol industry generally uses “depletions” (shipments direct to retailers or from distributors to wholesalers and retailers) to approximate consumer demand. We also purchase syndicated data and monitor inventory levels in the trade to better understand how well depletions represent consumer demand.

FISCAL 2011 COMPARED TO FISCAL 2010

Net sales of $3.4 billion increased 6%, or $178 million, compared to fiscal 2010. We continued to expand our international footprint, as net sales outside the United States grew double-digits compared to essentially flat net sales in the United States. Our net sales outside the United States now constitute 55% of our total sales, compared to 53% a year ago. Just 10 years ago, sales outside the United States constituted less than 25% of our total net sales.

The major factors driving our fiscal 2011 change in net sales were:

	Change vs. 2010
Underlying change in net sales	4%
Volume.......................................3%
Net price/mix.............................1%
Foreign exchange	2%
Reported change in net sales	6%

“Foreign exchange” refers to net gains or losses resulting from our sales and purchases in currencies other than the U.S. dollar. We disclose this separately to explain our business changes on a constant-currency basis, because exchange rate fluctuations can distort the underlying growth of our business (both positively and negatively). To filter out the effect of foreign exchange fluctuations, we translate current year results at prior-year rates. In fiscal 2011, the weaker dollar benefited our net sales, gross profit, operating income, and earnings per share but hurt our advertising expense and selling, general, and administrative expenses. Although foreign exchange volatility is a reality for a global company, we routinely review our performance on a constant-currency basis. We believe separately identifying foreign exchange’s effect on major line items of the consolidated statement of operations makes our underlying business performance more transparent.

We attribute our 4% underlying growth in net sales during fiscal 2011 primarily to (a) the performance of Jack Daniel’s Tennessee Whiskey, Jack Daniel’s RTDs, el Jimador, Gentleman Jack, Herradura, Woodford Reserve, and Sonoma-Cutrer; and (b) the introduction of new line extensions such as Jack Daniel’s Tennessee Honey, Southern Comfort Lime, and Chambord Vodka.

These gains were partially offset by lower used-barrel sales and by net sales declines for (a) an agency brand we sell in Poland, (b) Southern Comfort, and (c) Fetzer (which we sold in April 2011).

We experienced the most significant underlying growth in net sales in Australia, the United Kingdom, Mexico, Turkey, Germany, and France, while net sales declined in some countries, including Poland (driven by declines for the agency brand sold in that market) and Greece.

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Here are some details on our volume and net sales changes for the year:

·   Global depletions for Jack Daniel’s Tennessee Whiskey grew for the 19th consecutive year, approximating 10 million nine-liter cases, up 4% for fiscal 2011. The brand’s expansion was fueled by 8% growth internationally, while volumes were flat in the United States.

The overall distilled spirits category in the United States continued to grow during fiscal 2011. Industry trends as measured by National Alcohol Beverage Control Association (NABCA) data indicate that total distilled spirits volume grew 2.2% for the 12 months ended April 30, 2011, while Jack Daniel’s declined slightly – an improvement compared to its 3% drop in fiscal 2010. Most of Jack Daniel’s major competitors outperformed it on both a volume and dollar basis in the NABCA markets. We expect the brand to benefit from the recent launch of Jack Daniel’s Tennessee Honey and the introduction of spirits-based RTDs in fiscal 2012.

Consumer demand increased and expanded for this iconic, authentic American whiskey outside the United States, with gains throughout most of Europe, Latin America, Australia and travel retail. The brand’s largest market outside the United States, the United Kingdom, registered 4% growth in depletions. Net sales for the brand globally increased in the mid-single-digits on both an as-reported and a constant-currency basis.

·   Sales of Gentleman Jack grew at double-digit rates on both an as-reported and a constant-currency basis, and Jack Daniel’s Single Barrel (with depletions exceeding 100,000 nine-liter cases) grew at mid-single-digit rates on both an as-reported and a constant-currency basis.

·   Jack Daniel’s RTDs registered significant double-digit growth in net sales on both an as-reported and a constant-currency basis, as the brands benefitted from strong volumetric gains in Australia and Germany. Geographic expansion that began in fiscal 2010 in the United Kingdom and Mexico, and further expansion into other markets in fiscal 2011 (including North America, Belgium, and some markets in Southern Europe), also contributed to depletion and net sales growth for Jack Daniel’s RTDs.

·   Finlandia net sales declined in the low-single digits on both an as-reported and a constant-currency basis. The brand’s depletions declined 2% compared to last fiscal year, largely due to the anticipated disruption related to a distribution change in Russia. Excluding Russia, the brand grew in the low single-digits.  In Poland, the brand’s largest market, the brand returned to growth, with depletions growing 5% for fiscal 2011 after declining 10% in fiscal 2010. The brand grew in several markets in Central Europe, Turkey, Bulgaria, Romania, China, and travel retail.

·   Southern Comfort’s family of brands global depletions declined 3% in fiscal 2011. Its net sales decline on both an as-reported and a constant-currency basis was driven by depletion declines for the parent brand in its largest market, the United States. These declines were partially offset by the introduction of the Southern Comfort Lime line extension in this same market. Performance for the parent brand continues to be affected by increased competition from flavored whiskeys, flavored vodkas, and spiced rums, particularly those often consumed on-premise in shots.

·   El Jimador experienced high single-digit growth in depletions and double-digit growth in net sales on both an as-reported and a constant-currency basis, fueled by double-digit depletion gains in the United States, mid-single-digit growth in Mexico, and continued expansion into other markets.

·   Overall depletion and net sales performance were mixed for our other brands. Several of our super-premium priced brands registered depletion gains in fiscal 2011, including Herradura, Chambord, Woodford Reserve, and Sonoma-Cutrer.Meanwhile, Fetzer (which we sold in April 2011), Canadian Mist,and Early Times recorded depletion declines in fiscal 2011.

This table highlights our major brands’ worldwide depletion results for fiscal 2011:

	Nine-Liter Cases (000s)	% Change vs. 2010
Jack Daniel’s Family	16,025	8%
Jack Daniel’s Tennessee Whiskey	10,000	4%
Jack Daniel’s RTDs(1)	5,540	17%
New Mix RTDs(2)	4,645	4%
Finlandia	2,920	(2%)
Southern Comfort Family	2,165	(3%)
Fetzer	1,940	(11%)
Canadian Mist	1,700	(7%)
Super-Premium Other(3)	1,330	9%
Korbel Champagnes	1,320	2%
El Jimador	1,185	8%

(1) Jack Daniel’s RTD products include all RTD line extensions of Jack Daniel’s, such as Jack Daniel’s & Cola, Jack Daniel’s and Diet Cola, Jack & Ginger, and Jack Daniel’s Country Cocktails.

(2) New Mix is a tequila-based RTD brand we acquired in January 2007 as part of the Casa Herradura acquisition, initially sold only in Mexico but introduced in a few U.S. markets during fiscal 2010.

(3) Includes Bonterra (which we sold in April 2011 as part of the Fetzer sale), Chambord, Herradura, Sonoma-Cutrer, Tuaca, and Woodford Reserve.

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Gross profit increased 7%, or $113 million, during fiscal 2011, outpacing the rate of net sales growth for the year. In addition to the same factors that contributed to the increase in net sales – that is, foreign exchange and underlying growth – gross profit was helped by cost-of-goods-sold improvements associated with production efficiencies resulting from higher demand for our Jack Daniel’s products, cost savings from consolidation of production operations and various renegotiated contracts, and less value-added packaging. The table below summarizes the major factors that contributed to gross profit growth for the year.

	Change vs. 2010
Underlying change in gross profit	5%
Foreign exchange	2%
Reported change in gross profit	7%

For the second consecutive year, gross margin (gross profit as a percent of net sales) increased. This year, gross margin increased from 50.0% to 50.7%, reflecting the benefit of improved cost of goods sold.

Advertising expenses were up $16 million, or 5%, due in part to (a) increased investments behind the Jack Daniel’s family of brands, Herradura, el Jimador, New Mix, and Woodford Reserve and (b) support to launch new line extensions (notably Jack Daniel’s Tennessee Honey, Southern Comfort Lime, and Chambord Vodka). Overall advertising spending on a constant-currency basis (excluding the effect of foreign exchange) was up 4%.

	Change
	vs. 2010
Underlying change in advertising	4%
Foreign exchange	1%
Reported change in advertising	5%

We strove to optimize our mix of total brand investment by focusing resources among brands, geographies, and channels that we believe enable us to reach consumers around the world effectively and efficiently. New line extensions and the geographic expansion of our portfolio internationally received increased focus and support this past fiscal year. We expect to remain flexible in directing brand spending and resources to activities that support the business in the current environment while continuing to position us for long-term growth.

Selling, general, and administrative (SG&A) expenses increased $35 million, or 6%, as shown in the following table:

	Change
	vs. 2010
Underlying change in SG&A	5%
Foreign exchange	1%
Fetzer sale	1%
Dispute settlement	(1%)
Reported change in SG&A	6%

The expenses included in SG&A associated with the Fetzer sale were transaction-related costs.

“Dispute settlement” refers to the favorable resolution of a dispute in an international market relating to the importation of our brands.

Several factors contributed to the increase in the underlying spending in fiscal 2011, including an increase of approximately $20 million in pension and other postretirement benefit expense influenced by a lower discount rate and strategic investments that we believe position us for the long-term such as costs associated with route-to-consumer changes and investments in capabilities.

Other income increased $83 million in fiscal 2011, due primarily to (a) the $53 million pre-tax gain we realized on the Fetzer sale, of which $62 million4 was reflected in other income and (b) the absence of the $12 million non-cash impairment write-down of the Don Eduardo brand name during fiscal 2010.

Operating income reached a record $855 million in fiscal 2011, an improvement of $145 million, or 20%, over fiscal 2010. Operating income benefitted from:

·   6% underlying operating income growth;

·   the gain on the Fetzer sale ($53 million pre-tax);

·   the absence of the write-down of the Don Eduardo brand name ($12 million);

·   a weaker dollar (approximately $23 million); and

·   a net increase in estimated trade inventory levels.

Operating income was reduced by expenses associated with higher pension expense, strategic investments in several markets around the world, including costs associated with route-to-consumer changes, and expenses associated with the Fetzer sale.

The chart below summarizes the major factors contributing to the increase in operating income for the year and identifies our underlying operating income growth for fiscal 2011 of 20%.

	Change
	vs. 2010
Fetzer sale	7%
Underlying change in operating income	6%
Foreign exchange	3%
Don Eduardo brand name write-down	2%
Dispute settlement	1%
Estimated net change in trade inventories	1%
Reported change in operating income	20%

“Estimated net change in trade inventories” refers to the estimated financial impact of changes in distributor inventories for our brands. We compute this effect using our estimated depletion trends and separately identify distributor inventory changes in our explanation of changes for our key measures. We then adjust the percentage variances from the prior year to the current year for our key measures. We believe that separately identifying the impact of this item helps to explain how varying levels of distributor inventories can affect our business.

4See Note 14 to our consolidated financial statements for a breakdown of the details of the gain reflected in our accompanying consolidated statement of operations.

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Positive factors influencing our underlying growth in operating income for the year included:

·   higher consumer demand for Jack Daniel’s Tennessee Whiskey internationally, particularly in the United Kingdom, Germany, Poland, France, and Mexico;

·   continued solid gains for RTD products in Australia and Germany and expansion of RTDs in other countries;

·   gains for several other brands, including Sonoma-Cutrer, Woodford Reserve, Chambord, Southern Comfort Lime, el Jimador, Gentleman Jack, Jack Daniel’s Single Barrel, Herradura, and Woodford Reserve; and

·   production efficiencies and cost savings.

These positive factors were partially offset by higher pension expense, by lower used-barrel sales, and by volume declines for Southern Comfort, Fetzer, and agency brands.

Operating margin (operating income divided by net sales) improved to 25.1% in fiscal 2011 from 22.0% in fiscal 2010. This improvement reflects the gain on the Fetzer sale (which boosted our operating margin 1.6% points), an increase in gross margin of 0.7% points, and operating expense leverage.

Interest expense (net) decreased by $2 million compared to fiscal 2010, reflecting lower net debt and a greater percentage of floating rate debt at lower interest rates.

Our effective tax rate for fiscal 2011 was 31.0% compared to 34.1% in fiscal 2010. The decrease in our effective tax rate was driven primarily by the absence in fiscal 2011 of discrete items that resulted in additional tax expense in fiscal 2010.

The lower effective tax rate also reflects an adjustment made during the fourth quarter of fiscal 2011 to reverse $8 million of income tax expense that was incorrectly recognized in prior periods. We believe the impact of this error and the cumulative out of period adjustment to correct the error is insignificant to our consolidated financial statements for the current period and any prior periods.

Diluted earnings per share reached $3.90 in fiscal 2011, up 29% over diluted earnings per share in fiscal 2010. This growth resulted from the same factors that generated operating income growth and was also helped by a reduction of net interest expense, a lower effective tax rate, and fewer shares outstanding after share repurchases.

FISCAL 2010 COMPARED TO FISCAL 2009

Net sales increased 1%, or $34 million. Our underlying net sales grew 1% for the year, led by Jack Daniel’s & Cola, Jack Daniel’s Tennessee Whiskey, Gentleman Jack, Southern Comfort RTPs, el Jimador, Jack Daniel’s Single Barrel, and Woodford Reserve. Net sales declined for Southern Comfort, Finlandia, Fetzer, and several agency brands. Higher used-barrel sales also contributed to underlying net sales growth. Australia, Germany, France, and Turkey were the most significant countries that experienced underlying growth in net sales, while net sales declined in several countries, including Poland, Spain, the United Kingdom, and Russia. Jack Daniel’s registered depletion growth for the 18th consecutive year, up 2% globally. Jack Daniel’s RTDs grew depletions 39% globally, fueled by strong gains in Australia and Germany as well as expansion into the United Kingdom, Mexico, Italy, and a number of other markets. Gentlemen Jack and Jack Daniel’s Single Barrel depletions both grew at double-digit rates. Worldwide depletions for Finlandia fell 1%, due in part to retailer de-stocking and trading down by consumers in Poland (the brand’s largest market). Southern Comfort worldwide depletions declined 6%, caused in part by weakness in the on-premise channel around the world and by the increase in the number of flavored whiskey and vodka introductions in the United States as well as increased competition from spiced rums. The el Jimador brand grew 4% globally as it registered strong double-digit depletion gains in the important United States market and expanded into markets outside the United States. Overall depletion performance during fiscal 2010 was mixed for the other brands in our portfolio. Several of our super-premium priced brands registered depletion gains, including Herradura, Woodford Reserve, Sonoma-Cutrer, and Bonterra. Meanwhile, Fetzer, Canadian Mist, Tuaca, and New Mix all recorded depletion declines.

Gross profit grew $34 million, or 2%. In addition to the same factors that affected the increase in net sales, gross profit benefited from the absence of a $22 million non-cash agave inventory write-down included in costs of sales in fiscal 2009. Gross margin improved from 49.4% in fiscal 2009 to 50.0% in fiscal 2010. The absence of the non-cash agave inventory write-down and the loss of profits from low margin sold or discontinued brands from our portfolio boosted our gross margin for the year.

Advertising expenses decreased $33 million, or 9%, due primarily to the reallocation of our brand investments and promotional mix to those brands, markets, and channels where consumers and trade were most responsive. The reallocations are reflected in other activities, such as spending for value-added packaging (reflected in cost of sales in our financial statements) and targeted, selective consumer price promotions (reflected in net sales). Both of these costs are a form of brand investment.

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Selling, general, and administrative expenses decreased $9 million, or 1%, driven by the absence of the $12 million costs we took to reduce our cost base in fiscal 2009, including an early retirement program and an overall reduction in workforce, tight management of discretionary expenses, and the benefit of a stronger U.S. dollar. These factors were partially offset by higher compensation-related expenses.

Other income decreased $27 million in fiscal 2010, due primarily to the absence of the $20 million net gain we realized on the sale of the Bolla and Fontana Candida Italian wine trademarks and a $12 million non-cash impairment write-down of the Don Eduardo brand name during fiscal 2010.

Operating income of $710 million in fiscal 2010 increased $49 million, or 7%, compared to fiscal 2009. Operating income benefitted from planned cost savings and efficiencies, underlying operating income growth, the absence of the $22 million pre-tax non-cash agave write-down in fiscal 2009, the absence of $12 million of cost associated with our early retirement program and workforce reduction actions taken during fiscal 2009, and a net increase in estimated trade inventory levels. Operating income was hurt by the absence of $25 million of income from discontinued brands (including the $20 million net gain in fiscal 2009 on the sale of our Italian wine brands), the $12 million non-cash write-down of the Don Eduardo brand name during fiscal 2010, and the stronger U.S. dollar (which reduced operating income by $4 million). The underlying growth in operating income was driven by (a) higher consumer demand for Jack Daniel’s RTD products in Australia and Germany and the geographic expansion of those products into the United Kingdom, Spain, Italy, and Mexico; (b) gains for several other brands, including Jack Daniel’s, Gentleman Jack, el Jimador, Jack Daniel’s Single Barrel, Woodford Reserve, and Little Black Dress wines; (c) higher used-barrel sales; and (d) planned cost savings and efficiencies. These positive factors were partially offset by an increase in compensation expense and by volume declines for Southern Comfort globally, for Finlandia in Poland (its largest market), and for several agency brands.

Interest expense (net)decreased by $3 million compared to fiscal 2009, reflecting lower net debt and a reduction in short-term interest borrowing rates.

Our effective tax rate in fiscal 2010 was 34.1% compared to 31.1% in fiscal 2009. The increase was driven by items which had decreased our effective tax rate in fiscal 2009, including the net reversal of unrecognized tax benefits due to the expiration of statutes of limitations and the use of a portion of a capital loss carryforward from the sale of Lenox, Inc. to offset the gain realized from the Italian wine brands sale. The non-cash write-down of the Don Eduardo brand name during fiscal 2010 and the recognition of additional tax expense related to discrete items arising during the year negatively affected the effective rate in fiscal 2010.

Diluted earnings per share increased 5% to $3.02 in fiscal 2010. This growth primarily resulted from the same factors that generated operating income growth and was also helped by a reduction of net interest expense and fewer shares outstanding after share repurchases. Tempering these factors was a 3% increase in the effective tax rate for the year.

Basic and diluted earnings per share. In Note 12 to our consolidated financial statements, we describe our 2004 Omnibus Compensation Plan and how we issue stock-based awards under it. In Note 1, under “Stock-Based Compensation” we describe how the plan is designed to avoid diluting earnings per share.

OTHER KEY PERFORMANCE MEASURES

Our goal is to increase the value of our shareholders’ investment consistently and sustainably over the long term. We believe that the long-term relative performance of our stock is a good indication of our success in delivering attractive returns to shareholders.

Total shareholder return. An investment made in Brown-Forman Class B common stock over terms of one, three, five, and ten years would have significantly outperformed the returns of the S&P 500 over the same periods. Specifically, a $100 investment in our Class B stock on April 30, 2001, would have grown to approximately $375 by the end of fiscal 2011, assuming reinvestment of all dividends and ignoring personal taxes and transaction costs. This represents an annualized return of 14% over the 10-year period, compared to a comparable ten-year return in an investment in the S&P 500 of only 3%. A more recent investment in Brown-Forman Class B common stock (one year ago) would have provided a very strong return of 28% over the prior year, outpacing the 17% return of the S&P 500 for the same period.

Compound Annual Growth in Total Shareholder Return
(as of April 30, 2011, dividends reinvested)
	1 Year	3 Years	5 Years	10 Years
Brown-Forman Class B shares	28%	13%	7%	14%
S&P 500 index	17%	2%	3%	3%

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Return on average invested capital. Our return on average invested capital increased to 21.8% in fiscal 2011, driven by record earnings, including the $38 million after-tax gain on the Fetzer sale in April 2011, and by careful management of our investment base (which declined 4%). Excluding the gain from the Fetzer sale and discrete tax benefits, our return on average invested capital was 20.1%.  We believe this return surpassed those of our wine and spirits competitors. While we expect our return on average invested capital to decline in fiscal 2012 relative to fiscal 2011 reflecting the absence of the gain on the Fetzer sale, we expect our return on average invested capital to continue to increase over the longer term. This expectation is based on our positive outlook for earnings growth, given the growth opportunities for our brands around the world and our continued careful management of our investments in them. We aim to maintain our industry-leading return on average invested capital over the long term.

Return on Average Invested Capital:
Fiscal 2009	15.9%
Fiscal 2010	16.6%
Fiscal 2011	21.8%

LIQUIDITY AND CAPITAL RESOURCES

Our ability to generate cash from operations consistently is one of our most significant financial strengths. Our strong cash flows enable us to pay dividends, make appropriate capital investments, pursue brand-building programs, and make strategic acquisitions that we believe will enhance shareholder value. Investment grade ratings of A2 from Moody’s and A from Standard & Poor’s provide us with financial flexibility when accessing global credit markets. We believe cash flows from operations are more than adequate to meet our expected operating and capital requirements.

CASH FLOW SUMMARY
(Dollars in millions)	2009	2010	2011
Operating activities	$491	$545	$527
Investing activities:
Sale of business	—	—	234
Additions to property, plant, and equipment	(49)	(34)	(39)
Sale of brand names and trademarks	17	—	—
Sale of property, plant, and equipment	—	2	12
Other	(5)	(3)	(4)
	(37)	(35)	203
Financing activities:
Net (repayment) issuance of debt	(4)	(302)	57
Acquisition of treasury stock	(39)	(158)	(136)
Dividends paid	(169)	(174)	(326)
Other	(4)	(3)	(1)
	(216)	(637)	(406)
Foreign exchange effect	(17)	19	11
Change in cash and cash equivalents	$221	$(108)	$335

Cash and cash equivalents increased $335 million in fiscal 2011 compared to a decline of $108 million in fiscal 2010 due in part to the cash received from the Fetzer sale. Cash provided by operations was $527 million in fiscal 2011 compared to $545 million in fiscal 2010. The 3% decrease primarily reflects a $63 million increase in cash used to fund our pension plan obligations and higher working capital requirements reflecting an increase in receivables and barreled whiskey inventory levels, which were partially offset by an increase in earnings (excluding non-cash items).

Cash provided by investing activities in fiscal 2011 was $203 million, an increase of $238 million compared to fiscal 2010, primarily reflecting $234 million cash proceeds received from the Fetzer sale.

In fiscal 2011, cash used for financing activities decreased by $231 million, primarily reflecting a $359 million increase in net proceeds from debt (including $248 million from issuance in December 2010 of $250 million of 2.5% notes that will mature in January 2016) and a $22 million decline in share repurchases of our common stock, offset partially by a $152 million increase in dividend payments (including a special dividend of $145 million in December 2010).  

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The impact on cash and cash equivalents as a result of exchange rate changes was an increase of $11 million in fiscal 2011 compared to an increase of $19 million in fiscal 2010.

In comparing fiscal 2010 with fiscal 2009, cash provided by operations increased $54 million, primarily reflecting a reduction in working capital requirements and an increase in earnings.  Cash used by investing activities was essentially unchanged compared to fiscal 2009, as lower investments in property, plant, and equipment were offset by the absence of one-time proceeds received in fiscal 2009 from the sale of our Italian wine brands.  Cash used for financing activities increased $421 million, reflecting a $298 million net increase in debt repayments and a $119 million increase in share repurchases of our common stock compared to fiscal 2009.  The impact of cash and cash equivalents as a result of exchange rate changes was an increase of $19 million in fiscal 2010 compared to a decline of $17 million in fiscal 2009.

Fiscal 2011 Cash Utilization
Sources of Cash:
Operating activities	$527
Fetzer sale	234
Debt proceeds, net	57
Other, net	21
Uses of Cash:
Ordinary dividend	$181
Special dividend	145
Share repurchases	136
Capital spending (including software)	42

Capital expenditures. Investments in property, plant, and equipment were $49 million in fiscal 2009, $34 million in fiscal 2010, and $39 million in fiscal 2011. Expenditures over the three-year period included investments to maintain, expand, and improve production efficiency, to reduce costs, and to build our brands.

We expect capital expenditures for fiscal 2012 to be from $55 million to $65 million, funded by cash provided by operations.  Our capital spending plans for fiscal 2012 include investments to expand production capacity at Jack Daniel’s, to reduce costs, to mitigate risk, and to enhance compliance projects.

Share repurchases. In December 2008, our Board of Directors authorized us to repurchase $250 million of our outstanding Class A and Class B common shares over the succeeding 12 months, subject to market conditions. Under this plan, which expired on December 3, 2009, we repurchased 4,249,039 shares (23,788 of Class A and 4,225,251 of Class B) for approximately $196 million. The average repurchase price per share, including broker commissions, was $47.13 for Class A and $46.06 for Class B.

In June 2010, our Board of Directors authorized us to repurchase up to $250 million of our outstanding Class A and Class B common shares before December 1, 2010, subject to market and other conditions. Under this program, we repurchased a total of 1,965,326 shares (20,869 of Class A and 1,944,457 of Class B) for approximately $117 million. The average repurchase price per share, including broker commissions, was $59.90 for Class A and $59.60 for Class B.

As we announced on March 25, 2011, our Board of Directors has authorized us to repurchase up to $250 million of our outstanding Class A and Class B common shares through November 30, 2011, subject to market conditions. Under this program, we may repurchase shares from time to time for cash in open market purchases, block transactions, and privately negotiated transactions in accordance with federal securities laws. As of June 16, 2011, we have repurchased 350,038 shares (31,711 of Class A and 318,327 of Class B) for approximately $24 million.  The average repurchase price per share, including broker commissions, was $69.30 for Class A and $69.21 for Class B.

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This table highlights our share repurchases:

				Average price per		Total spent on
				share, including		stock repurchase
Dates		Shares purchased(1)		brokerage commissions(1)		program
Starting	Ending	Class A	Class B	Class A	Class B	(millions)(1)
December 2008	December 2009	23,788	4,225,251	$47.13	$46.06	$196.0
June 2010	December 2010	20,869	1,944,457	$59.90	$59.60	$117.1
March 2011	November 2011	31,711	318,327	$69.30	$69.21	$24.2

(1) For the stock purchase program begun in March 2011, data is through June 16, 2011.

Liquidity. We continue to manage liquidity conservatively to meet current obligations, fund capital expenditures, and maintain dividends, while reserving adequate debt capacity for acquisition opportunities. In fiscal 2011, we enhanced our liquidity by issuing $250 million of unsecured, 2.5% notes, due in 2016, with the proceeds used for general corporate purposes, including reducing our outstanding short-term commercial paper.

We have access to several liquidity sources to supplement our cash flow from operations.  Our commercial paper program, supported by our bank credit facility, continues to fund our short-term credit needs.  We could also satisfy our liquidity needs by drawing on our $800 million bank credit facility (currently unused). This facility expires April 30, 2012, and carries favorable terms compared with current market conditions. We anticipate negotiating a replacement bank credit facility in fiscal 2012, as bank market conditions have continued to improve steadily.

Under extreme market conditions, one or more participating banks may not be able to fully fund this credit facility. While we are alert to this uncertainty, we believe the banking market has improved considerably. Also, we believe that the markets for investment-grade bonds and private placements are very accessible and provide a source of long-term financing that, in addition to our cash flow from operations, we could use to meet any additional liquidity needs.

We have high credit standards when initiating transactions with counterparties and closely monitor our counterparty risks with respect to our cash balances and derivative contracts (that is, foreign currency, commodity, and interest rate hedges). If a counterparty’s credit quality were to deteriorate below our credit standards, we would either liquidate exposures or require the counterparty to post appropriate collateral.

We believe our current liquidity position is strong and sufficient to meet all of our financial commitments for the foreseeable future. Our $800 million bank credit facility’s most restrictive covenant requires our ratio of consolidated EBITDA (as defined in the agreement) to consolidated interest expense to be at least 3 to 1. At April 30, 2011, with a ratio of 32 to 1, we were well within the covenant’s parameters.

LONG-TERM OBLIGATIONS

We have long-term obligations related to contracts, leases, borrowing arrangements, and employee benefit plans that we enter into in the normal course of business (see Notes 4, 7, and 11 to the accompanying consolidated financial statements). The following table summarizes the amounts of those obligations as of April 30, 2011, and the years when those obligations must be paid:

LONG-TERM OBLIGATIONS(1)
			2013-	After
(Dollars in millions)	Total	2012	2016	2016
Long-term debt	$759	$253	$506	$ —
Interest on long-term debt	46	23	23	—
Grape purchase obligations	10	4	6	—
Operating leases	39	17	22	—
Postretirement benefit obligations(2)	43	43	n/a	n/a
Agave purchase obligations(3)	n/a	n/a	n/a	n/a
Total	$897	$340	$557	$—

(1) Excludes liabilities for tax uncertainties as we are unable to reasonably predict the ultimate amount or timing of settlement.

(2) As of April 30, 2011, we have unfunded pension and other postretirement benefit obligations of $202 million. Because the specific periods in which those obligations will be funded are not determinable, no amounts related to those obligations are reflected in the above table other than the $43 million of expected contributions in fiscal 2012 (including the $6 million of required contributions). Historically, we have generally funded these obligations with the minimum annual contribution required by ERISA, but we may elect to contribute more than the minimum amount in future years.

(3) As discussed in Note 4 to the accompanying consolidated financial statements, we have obligations to purchase agave, a plant whose sap forms the raw material for tequila. Because the specific periods in which those obligations will be paid are not determinable, no amounts related to those obligations are reflected in the table above. As of April 30, 2011, based on current market prices, obligations under these contracts totaled $4 million.

We expect to meet these obligations with internally generated funds.

46

CRITICAL ACCOUNTING ESTIMATES

Our financial statements reflect certain estimates involved in applying the following critical accounting policies that entail uncertainties and subjectivity. Using different estimates could have a material effect on our operating results and financial condition.

Goodwill and other intangible assets. We have obtained most of our brands through acquisitions of other companies. Upon acquisition, the purchase price is first allocated to identifiable assets and liabilities, including intangible brand names and trademarks (“brand names”), other intangible assets, based on estimated fair value, with any remaining purchase price recorded as goodwill. Goodwill and intangible assets with indefinite lives are not amortized. We consider all of our brand names to have indefinite lives.

We assess our goodwill and other indefinite-lived assets for impairment at least annually. If the fair value of an asset is less than its book value, we write it down to its estimated fair value. Goodwill is evaluated for impairment if the book value of its reporting unit exceeds its estimated fair value. We estimate the fair value of a reporting unit using discounted estimated future cash flows. We typically estimate the fair value of a brand name using the “relief from royalty” method. We also consider market values for similar assets when available.

Considerable management judgment is necessary to estimate fair value, including the selection of assumptions about future cash flows, discount rates, and royalty rates.

Based on our long-term assumptions, we believe none of our goodwill or other intangibles are impaired.  However, one of our brand names, Herradura, while overall showing significant improvement in performance compared to a year ago, must continue to accelerate its trends in this difficult global economic environment.  As of April 30, 2011, the book value of Herradura was $124 million.  At the test date for impairment, January 31, 2011, the fair value of the Herradura brand name exceeded the carrying value by approximately $2 million.  Future events or changes in the assumptions used to estimate the fair value of this brand name could significantly change its fair values, which could result in future impairment charges.  For example, a 50-basis-point increase in our cost of capital, a key assumption in which a small change can have a significant effect, would decrease the fair value of the Herradura brand name by $12 million.  This would result in a non-cash brand name impairment charge.

We have a number of plans and initiatives we believe will drive the anticipated growth of Herradura, and this growth is essential to our fair value estimates.  If our initiatives are not sufficiently successful or if global economic conditions were to deteriorate, the brand name could become impaired, which would adversely affect our earnings and stockholders’ equity.

Property, plant, and equipment. We depreciate our property, plant, and equipment on a straight-line basis using our estimates of useful life, which are 20–40 years for buildings and improvements; 3–10 years for machinery, equipment, vehicles, furniture, and fixtures; and 3–7 years for capitalized software.

We assess our property, plant, and equipment for impairment whenever events or changes in circumstances indicate that the carrying value of those assets may not be recoverable. When we do not expect to recover the carrying value of an asset (or asset group) through undiscounted future cash flows, we write it down to its estimated fair value. We determine fair value using discounted estimated future cash flows, considering market values for similar assets when available. Considerable management judgment is necessary to assess impairment and estimate fair value.

Pension and other postretirement benefits. We sponsor various defined benefit pension plans as well as postretirement plans providing retiree health care and retiree life insurance benefits. Benefits are based on factors such as years of service and compensation level during employment. We expense the benefits expected to be paid over the employees’ expected service. This requires us to make certain assumptions to determine the net benefit expense and obligations, such as interest rates, return on plan assets, the rate of salary increases, expected service, and health care cost trend rates.

The assets, obligations, and assumptions used to measure pension and retiree medical expenses are determined at the beginning of the year (“measurement date”). Because obligations are measured on a discounted basis, the discount rate is a significant assumption. It is based on interest rates for high-quality, long-term corporate debt at each measurement date. The expected return on pension plan assets reflects expected capital market returns for each asset class, which are based on historical returns, adjusted for the expected effects of diversification and active management (net of fees) of the assets. The other assumptions also reflect our historical experience and management’s best judgment regarding future expectations. We review our assumptions on each annual measurement date. As of April 30, 2011, we have decreased the discount rate for pension obligations from 5.91% to 5.67%, and for other postretirement benefit obligations from 5.78% to 5.59%. We have also decreased the expected return on plan assets from 8.50% to 8.25% in connection with a change in our target allocation of plan assets.  Using these assumptions, pension and postretirement benefit expense for fiscal 2012 is estimated to be approximately $35 million, compared to $37 million for fiscal 2011. A decrease/increase of 25 basis points in the assumed discount rate would increase/decrease the fiscal 2012 expense by approximately $2 million.  A decrease/increase of 25 basis points in the assumed return on plan assets would increase/decrease the fiscal 2012 expense by approximately $1 million.

47

Income taxes. Our annual effective tax rate is based on our income and the statutory tax rates in the various jurisdictions where we do business. In fiscal 2011, our annual effective income tax rate was 31.0%, compared to 34.1% in fiscal 2010. The decrease in our effective tax rate was driven primarily by the absence in fiscal 2011 of discrete items that resulted in additional tax expense in fiscal 2010.

The lower effective rate also reflects an adjustment made during the fourth quarter of fiscal 2011 to reverse $8 million of income tax expense that was incorrectly recognized in prior periods. We believe the impact of this error and the cumulative out of period adjustment to correct the error is insignificant to our consolidated financial statements for the current period and any prior periods.

Significant judgment is required in evaluating our tax positions. We establish liabilities when certain positions are likely to be challenged and may not succeed, despite our belief that our tax return positions are fully supportable. We adjust these liabilities in light of changing circumstances, such as the progress of a tax audit. We believe current liabilities are appropriate for all known contingencies, but this situation could change.

Years can elapse before we can resolve a particular matter for which we have established a liability. Although predicting the final outcome or the timing of resolution of any particular tax matter can be difficult, we believe our liabilities reflect the likely outcome of known tax contingencies. Unfavorable settlement of any particular issue could require use of our cash; conversely, a favorable resolution could result in either reduced cash tax payments, or the reversal of previously established liabilities, or some combination of these, which could reduce our effective tax rate.

Contingencies. We operate in a litigious environment, and we are sued in the normal course of business. Sometimes plaintiffs seek substantial damages. Significant judgment is required in predicting the outcome of these suits and claims, many of which take years to adjudicate. We accrue estimated costs for a contingency when we believe that a loss is probable and we can make a reasonable estimate of the loss, and then adjust the accrual as appropriate to reflect changes in facts and circumstances. We do not believe these loss contingencies, individually or in the aggregate, would have a material adverse effect on our financial position, results of operations, or liquidity. No material accrued loss contingencies are recorded as of April 30, 2011.

Recent accounting pronouncements. See Note 1 to the accompanying consolidated financial statements.

48

BROWN-FORMAN CORPORATION

CONSOLIDATED STATEMENTS OF OPERATIONS

(Dollars in millions, except per share amounts)

Year Ended April 30,	2009	2010	2011
Net sales	$3,192	$3,226	$3,404
Excise taxes	711	757	818
Cost of sales	904	858	862
Gross profit	1,577	1,611	1,724
Advertising expenses	383	350	366
Selling, general, and administrative expenses	548	539	574
Amortization expense	5	5	5
Other (income) expense, net	(20)	7	(76)
Operating income	661	710	855
Interest income	6	3	3
Interest expense	37	31	29
Income before income taxes	630	682	829
Income taxes	195	233	257
Net income	$435	$449	$572
Earnings per share:
Basic	$2.88	$3.03	$3.92
Diluted	$2.87	$3.02	$3.90

 The accompanying notes are an integral part of the consolidated financial statements.

49

BROWN-FORMAN CORPORATION

CONSOLIDATED BALANCE SHEETS

 (Dollars in millions)

April 30,	2010	2011
Assets
Cash and cash equivalents	$232	$567
Accounts receivable, less allowance for doubtful accounts of $16 in 2010 and $18 in 2011	418	496
Inventories:
Barreled whiskey	299	330
Finished goods	142	150
Work in process	157	120
Raw materials and supplies	53	47
Total inventories	651	647
Current deferred tax assets	42	48
Other current assets	184	218
Total current assets	1,527	1,976
Property, plant, and equipment, net	468	393
Goodwill	666	625
Other intangible assets	669	670
Deferred tax assets	11	12
Other assets	42	36
Total assets	$3,383	$3,712
Liabilities
Accounts payable and accrued expenses	$342	$412
Accrued income taxes	4	32
Current deferred tax liabilities	9	8
Short-term borrowings	188	–
Current portion of long-term debt	3	255
Total current liabilities	546	707
Long-term debt, less unamortized discount of $1 in 2010 and $2 in 2011	508	504
Deferred tax liabilities	82	150
Accrued pension and other postretirement benefits	283	203
Other liabilities	69	88
Total liabilities	1,488	1,652
Commitments and contingencies
Stockholders’ Equity
Common stock:
Class A, voting, $0.15 par value (57,000,000 shares authorized; 56,964,000 shares issued)	9	9
Class B, nonvoting, $0.15 par value (100,000,000 shares authorized; 99,363,000 shares issued)	15	15
Additional paid-in capital	59	55
Retained earnings	2,464	2,710
Accumulated other comprehensive (loss) income, net of tax:
Pension and other postretirement benefits adjustment	(190)	(165)
Cumulative translation adjustment	11	48
Unrealized gain (loss) on cash flow hedge contracts	3	(14)
Treasury stock, at cost (9,364,000 and 11,337,000 shares in 2010 and 2011, respectively)	(476)	(598)
Total stockholders’ equity	1,895	2,060
Total liabilities and stockholders’ equity	$3,383	$3,712

The accompanying notes are an integral part of the consolidated financial statements.

50

BROWN-FORMAN CORPORATION

CONSOLIDATED STATEMENTS OF CASH FLOWS

 (Dollars in millions)

Year Ended April 30,	2009	2010	2011
Cash flows from operating activities:
Net income	$435	$449	$572
Adjustments to reconcile net income to net cash provided by operations:
Gain on sale of business	–	–	(38)
Non-cash asset write-downs	22	12	–
Depreciation and amortization	55	59	56
Gain on sale of brand names	(20)	–	–
Stock-based compensation expense	7	8	9
Deferred income taxes	12	11	32
Other	–	(1)	(2)
Changes in assets and liabilities, excluding the effects of sale of business:
Accounts receivable	33	(35)	(57)
Inventories	(34)	21	(42)
Other current assets	(5)	24	(2)
Accounts payable and accrued expenses	4	(14)	21
Accrued income taxes	(8)	(2)	7
Noncurrent assets and liabilities	(10)	13	(29)
Cash provided by operating activities	491	545	527
Cash flows from investing activities:
Proceeds from sale of business	–	–	234
Additions to property, plant, and equipment	(49)	(34)	(39)
Proceeds from sale of property, plant, and equipment	–	2	12
Acquisition of brand names and trademarks	–	–	(1)
Proceeds from sale of brand names and trademarks	17	–	–
Computer software expenditures	(5)	(3)	(3)
Cash (used for) provided by investing activities	(37)	(35)	203
Cash flows from financing activities:
Net repayment of short-term borrowings	(249)	(149)	(188)
Repayment of long-term debt	(4)	(153)	(3)
Proceeds from long-term debt	249	–	248
Debt issuance costs	(2)	–	(2)
Net payments related to exercise of stock-based awards	(6)	(6)	(7)
Excess tax benefits from stock-based awards	4	3	8
Acquisition of treasury stock	(39)	(158)	(136)
Dividends paid	(169)	(174)	(326)
Cash used for financing activities	(216)	(637)	(406)
Effect of exchange rate changes on cash and cash equivalents	(17)	19	11
Net increase (decrease) in cash and cash equivalents	221	(108)	335
Cash and cash equivalents, beginning of period	119	340	232
Cash and cash equivalents, end of period	$340	$232	$567
Supplemental disclosure of cash paid for:
Interest	$34	$32	$26
Income taxes	$222	$219	$203

The accompanying notes are an integral part of the consolidated financial statements.

51

BROWN-FORMAN CORPORATION

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

 (Dollars in millions, except per share amounts)

Year Ended April 30,	2009	2010	2011
Class A Common Stock, balance at beginning and end of year	$9	$9	$9
Class B Common Stock:
Balance at beginning of year	10	15	15
Stock distribution (Note 1)	5	–	–
Balance at end of year	15	15	15
Additional Paid-in Capital:
Balance at beginning of year	74	67	59
Stock-based compensation expense	5	8	9
Loss on issuance of treasury stock issued under compensation plans	(16)	(19)	(21)
Excess tax benefits from stock-based awards	4	3	8
Balance at end of year	67	59	55
Retained Earnings:
Balance at beginning of year	1,931	2,189	2,464
Net income	435	449	572
Cash dividends ($1.12, $1.18, and $2.24 per share in 2009, 2010, and 2011, respectively)	(169)	(174)	(326)
Stock distribution (Note 1)	(5)	–	–
Change in measurement date of postretirement benefit plans, net of tax of $2 (Note 11)	(3)	–	–
Balance at end of year	2,189	2,464	2,710
Accumulated Other Comprehensive Income (Loss):
Balance at beginning of year	5	(133)	(176)
Net other comprehensive income (loss)	(147)	(43)	45
Change in measurement date of postretirement benefit plans, net of tax of $(6) (Note 11)	9	–	–
Balance at end of year	(133)	(176)	(131)
Treasury Stock, at Cost:
Balance at beginning of year	(304)	(331)	(476)
Acquisition of treasury stock	(39)	(158)	(136)
Stock issued under compensation plans	10	13	14
Stock-based compensation expense	2	–	–
Balance at end of year	(331)	(476)	(598)
Total Stockholders’ Equity	$1,816	$1,895	$2,060
Class A Common Shares Outstanding (in thousands):
Balance at beginning of year	56,573	56,590	56,601
Acquisition of treasury stock	(22)	(12)	(40)
Stock issued under compensation plans	39	23	–
Balance at end of year	56,590	56,601	56,561
Class B Common Shares Outstanding (in thousands):
Balance at beginning of year	64,019	93,537	90,362
Stock distribution (Note 1)	30,175	–	–
Acquisition of treasury stock	(843)	(3,398)	(2,200)
Stock issued under compensation plans	186	223	267
Balance at end of year	93,537	90,362	88,429
Total Common Shares Outstanding (in thousands)	150,127	146,963	144,990

The accompanying notes are an integral part of the consolidated financial statements.

52

BROWN-FORMAN CORPORATION

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Dollars in millions)

Year Ended April 30,	2009	2010	2011
Net income	$435	$449	$572
Other comprehensive (loss) income:
Foreign currency translation adjustment	(109)	21	37
Amounts related to postretirement benefit plans:
Net actuarial (loss) gain and prior service cost, net of tax of $33, $46, and $(9) in 2009, 2010, and 2011, respectively	(52)	(66)	13
Reclassification to earnings, net of tax of $(3), $(2), and $(8) in 2009, 2010, and 2011, respectively	4	3	12
Amounts related to cash flow hedges:
Net gain (loss) on hedging instruments, net of tax of $(12), $7, and $10 in 2009, 2010, and 2011, respectively	16	(11)	(17)
Reclassification to earnings, net of tax of $4 and $(6) in 2009 and 2010, respectively	(6)	10	–
Net other comprehensive (loss) income	(147)	(43)	45
Total comprehensive income	$288	$406	$617

The accompanying notes are an integral part of the consolidated financial statements.

53

BROWN-FORMAN CORPORATION

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(Dollars in millions, except per share data)

1. ACCOUNTING POLICIES

We prepare our consolidated financial statements in conformity with accounting principles generally accepted in the United States (GAAP). We also apply the following accounting policies when preparing our consolidated financial statements:

Principles of consolidation. Our consolidated financial statements include the accounts of all wholly owned and majority-owned subsidiaries. We use the equity method to account for investments in affiliates over which we can exercise significant influence (but not control). We carry all other investments in affiliates at cost. We eliminate all intercompany transactions.

Cash equivalents. Cash equivalents include bank demand deposits and all highly liquid investments with original maturities of three months or less.

Allowance for doubtful accounts. We evaluate the collectability of accounts receivable based on a combination of factors. When we are aware of circumstances that may impair a specific customer’s ability to meet its financial obligations, we record a specific allowance to reduce the net recognized receivable to the amount we believe will be collected. We write off the uncollectible amount against the allowance when we have exhausted our collection efforts.

Inventories. We state inventories at the lower of cost or market, with approximately 63% of consolidated inventories being valued using the last-in, first-out (LIFO) method. We value the remainder primarily using the first-in, first-out (FIFO) method. FIFO cost approximates current replacement cost. If we had used the FIFO method for all inventories, they would have been $219 and $204 higher than reported at April 30, 2010 and 2011, respectively.

Whiskey must be barrel-aged for several years, so we bottle and sell only a portion of our whiskey inventory each year. Following industry practice, we classify all barreled whiskey as a current asset. We include warehousing, insurance, ad valorem taxes, and other carrying charges applicable to barreled whiskey in inventory costs.

We classify bulk wine and agave inventories as work in process.

During 2009, we recorded a $22 provision for inventory losses (included in cost of sales) resulting from abnormally high levels of mortality and disease in some of our agave fields.

Property, plant, and equipment. We state property, plant, and equipment at cost less accumulated depreciation. We calculate depreciation on a straight-line basis using our estimates of useful life, which are 20–40 years for buildings and improvements; 3–10 years for machinery, equipment, vehicles, furniture, and fixtures; and 3–7 years for capitalized software.

We assess our property, plant, and equipment for impairment whenever events or changes in circumstances indicate that the carrying value of those assets may not be recoverable. When we do not expect to recover the carrying value of an asset (or asset group) through undiscounted future cash flows, we write it down to its estimated fair value. We determine fair value using discounted estimated future cash flows, considering market values for similar assets when available.

Upon disposal or retirement of property, plant, and equipment, we remove its cost and accumulated depreciation from our balance sheet. Any gain or loss is reflected in operating income. We expense the cost of repairing and maintaining our property, plant, and equipment as costs are incurred.

Goodwill and other intangible assets. We have obtained most of our brands by acquiring other companies. Upon acquisition, the purchase price is first allocated to identifiable assets and liabilities, including intangible brand names and trademarks (“brand names”), based on estimated fair value, with any remaining purchase price recorded as goodwill. We do not amortize goodwill or intangible assets with indefinite lives. We consider all of our brand names to have indefinite lives.

We assess our goodwill and other indefinite-lived intangible assets for impairment at least annually. If the fair value of an asset is less than its book value, we write it down to its estimated fair value. Goodwill is evaluated for impairment if the book value of its reporting unit exceeds its estimated fair value. We estimate the fair value of a reporting unit using discounted estimated future cash flows. We typically estimate the fair value of a brand name using the “relief from royalty” method. We also consider market values for similar assets when available. Considerable management judgment is necessary to estimate fair value, including the selection of assumptions about future cash flows, discount rates, and royalty rates.

Foreign currency translation. The U.S. dollar is the functional currency for most of our consolidated operations. For those operations, we report all gains and losses from foreign currency transactions in current income. The local currency is the functional currency for some foreign operations. For those investments, we report cumulative translation effects as a component of accumulated other comprehensive income (loss), a component of stockholders’ equity.

Revenue recognition. We recognize revenue when title and risk of loss pass to the customer, typically when the product is shipped. Some sales contracts contain customer acceptance provisions that grant a right of return on the basis of either subjective or objective criteria. We record revenue net of the estimated cost of sales returns and allowances.

Sales discounts. Sales discounts, which are recorded as a reduction of net sales, totaled $328, $398, and $461 for 2009, 2010, and 2011, respectively.

Excise taxes. Our sales are subject to excise taxes, which we collect from our customers and remit to governmental authorities. We present these taxes on a gross basis (included in net sales and costs before gross profit) in the consolidated statement of operations.

Cost of sales. Cost of sales includes the costs of receiving, producing, inspecting, warehousing, insuring, and shipping goods sold during the period.

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Shipping and handling fees and costs. We report the amounts we bill to our customers for shipping and handling as net sales, and we report the costs we incur for shipping and handling as cost of sales.

Advertising costs. We expense the costs of advertising during the year when the advertisements first take place.

Selling, general, and administrative expenses. Selling, general, and administrative expenses include the costs associated with our sales force, administrative staff and facilities, and other expenses related to our non-manufacturing functions.

Income taxes. We base our annual provision for income taxes on the pre-tax income reflected in our consolidated statement of operations. We establish deferred tax liabilities or assets for temporary differences between financial and tax reporting bases and subsequently adjust them to reflect changes in tax rates expected to be in effect when the temporary differences reverse. We record a valuation allowance as necessary to reduce a deferred tax to the amount that we believe is more likely than not to be realized. We do not provide deferred income taxes on undistributed earnings of foreign subsidiaries that we expect to permanently reinvest.

We assess our uncertain income tax positions using a two-step process. First, we evaluate whether the tax position will more likely than not, based on its technical merits, be sustained upon examination, including resolution of any related appeals or litigation. For a tax position that does not meet this first criterion, we recognize no tax benefit. For a tax position that does meet the first criterion, we recognize a tax benefit in an amount equal to the largest amount of benefit that we believe has more than a 50% likelihood of being realized upon ultimate resolution.

Earnings per share. We calculate basic earnings per share by dividing net income available to common stockholders by the weighted average number of all unrestricted common shares outstanding during the period. Diluted earnings per share further includes the dilutive effect of stock options, stock-settled appreciation rights (SSARs), restricted stock units (RSUs), and deferred stock units (DSUs). We calculate that dilutive effect using the “treasury stock method” (as defined by GAAP).

We have granted restricted shares of common stock to certain employees as part of their compensation. These restricted shares, which have varying vesting periods, contain non-forfeitable rights to dividends declared on common stock. As a result, the unvested restricted shares are considered participating securities in the calculation of earnings per share in accordance with a new accounting standard that we adopted retrospectively effective May 1, 2009. The adoption decreased previously reported basic earnings per share for 2009 from $2.89 to $2.88.

The following table presents information concerning basic and diluted earnings per share:

	2009	2010	2011
Basic and diluted net income	$435	$449	$572
Income allocated to participating securities (restricted shares)	(1)	(1)	(1)
Net income available to common stockholders	$434	$448	$571
Share data (in thousands):
Basic average common shares outstanding	150,452	147,834	145,603
Dilutive effect of stock options, SSARs, RSUs, and DSUs	927	741	910
Diluted average common shares outstanding	151,379	148,575	146,513
Basic earnings per share	$2.88	$3.03	$3.92
Diluted earnings per share	$2.87	$3.02	$3.90

SSARs for approximately 1,899,000 common shares, 824,000 common shares, and 350,000 common shares were excluded from the calculation of diluted earnings per share for 2009, 2010, and 2011, respectively, because they were not dilutive for those periods under the treasury stock method.

Stock distribution. In September 2008, our Board of Directors authorized a stock split, effected as a stock dividend, of one share of Class B common stock for every four shares of either Class A or Class B common stock held by stockholders of record as of the close of business on October 6, 2008, with fractional shares paid in cash. The distribution took place on October 27, 2008. As a result of the stock distribution, we reclassified approximately $5 from our retained earnings to our common stock account. The $5 represents the $0.15 par value per share of the shares issued in the stock distribution.

Stock-based compensation. Our stock-based compensation plan requires that we purchase shares to satisfy stock-based compensation requirements, thereby avoiding future dilution of earnings that would occur from issuing additional shares. We acquire treasury shares from time to time in anticipation of these requirements. We intend to hold enough treasury stock so that the number of diluted shares never exceeds the original number of shares outstanding at the inception of the stock-based compensation plan (as adjusted for any share issuances unrelated to the plan). The extent to which the number of diluted shares exceeds the number of basic shares is determined by how much our stock price has appreciated since the stock-based compensation was awarded, not by how many treasury shares we have acquired.

55

Estimates. To prepare financial statements that conform with generally accepted accounting principles, our management must make informed estimates that affect how we report revenues, expenses, assets, and liabilities, including contingent assets and liabilities. Actual results could (and probably will) differ from these estimates.

Recent accounting pronouncements. During fiscal 2011, we adopted new guidance for disclosures about allowances for doubtful accounts and about fair value measurements. Adopting this new accounting guidance had no material impact on our financial statements.

2. BALANCE SHEET INFORMATION

Supplemental information on our year-end balance sheets is as follows:

April 30,	2010	2011
Other current assets:
Prepaid taxes	$99	$129
Other	85	89
	$184	$218
Property, plant, and equipment:
Land	$89	$69
Buildings	349	317
Equipment	491	446
Construction in process	15	11
	944	843
Less accumulated depreciation	476	450
	$468	$393
Accounts payable and accrued expenses:
Accounts payable, trade	$97	$126
Accrued expenses:
Advertising	55	72
Compensation and commissions	90	81
Excise and other non-income taxes	43	54
Self-insurance claims	12	11
Postretirement benefits	6	6
Interest	4	7
Other	35	55
	245	286
	$342	$412

3. GOODWILL AND OTHER INTANGIBLE ASSETS

The following table shows the changes in the amounts recorded as goodwill (which includes no accumulated impairment losses) over the past two years:

Balance as of April 30, 2009	$675
Foreign currency translation adjustment and other	(9)
Balance as of April 30, 2010	666
Disposal of Hopland-based wine business (Note 14)	(49)
Foreign currency translation adjustment	8
Balance as of April 30, 2011	$625

As of April 30, 2010 and 2011, our other intangible assets consisted of:

	Gross Carrying		Accumulated
	Amount		Amortization
	2010	2011	2010	2011
Finite-lived intangible assets:
Distribution rights	$25	$25	$(17)	$(22)
Indefinite-lived intangible assets:
Trademarks and brand names	661	667	–	–

Amortization expense related to intangible assets was $5 during each of the last three fiscal years. We expect to recognize amortization expense of $3 in fiscal 2012.

As discussed in Note 1, we assess each of our indefinite-lived intangible assets for impairment at least annually. During fiscal 2010, our assessment indicated that the book value of one of our brand names, Don Eduardo, exceeded its fair value by $12. As a result, we wrote down the book value of the Don Eduardo brand name by that amount, which is reflected in other expense in the accompanying consolidated statement of operations. The remaining book value of the Don Eduardo brand name is not material. The decline in its value reflected a significant reduction in estimated future net sales for this low-volume, high-priced tequila brand that had in part been affected by the downturn in the global economic environment that began during the second half of calendar 2008.

4. COMMITMENTS

We made rental payments for real estate, vehicles, and office, computer, and manufacturing equipment under operating leases of $21 in 2009, $22 in 2010, and $22 in 2011. We have commitments related to minimum lease payments of $17 in 2012, $10 in 2013, $7 in 2014, $4 in 2015, and $1 in 2016.

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We have contracted with various growers and wineries to supply some of our future grape and bulk wine requirements. Many of these contracts call for prices to be adjusted annually up or down, according to market conditions. Some contracts set a fixed purchase price that might be higher or lower than prevailing market price. We have total purchase obligations related to both types of contracts of $4 in 2012, $3 in 2013, and $3 in 2014.

We also have contracts for the purchase of agave, which is used to produce tequila. These contracts provide for prices to be determined based on market conditions at the time of harvest, which, although not specified, is expected to occur over the next 10 years. As of April 30, 2011, based on current market prices, obligations under these contracts totaled $4.

5. CONTINGENCIES

We operate in a litigious environment, and we are sued in the normal course of business. Sometimes plaintiffs seek substantial damages. Significant judgment is required in predicting the outcome of these suits and claims, many of which take years to adjudicate. We accrue estimated costs for a contingency when we believe that a loss is probable and we can make a reasonable estimate of the loss, and then adjust the accrual as appropriate to reflect changes in facts and circumstances. We do not believe these loss contingencies, individually or in the aggregate, would have a material adverse effect on our financial position, results of operations, or liquidity. No material accrued loss contingencies are recorded as of April 30, 2011.

6. CREDIT FACILITIES

We have a committed revolving credit agreement with various U.S. and international banks for $800 that expires on April 30, 2012. Its most restrictive covenant requires that our consolidated EBITDA (as defined in the agreement) to consolidated interest expense not be less than a ratio of 3 to 1. At April 30, 2011, we were well within this covenant’s parameters and had no borrowing outstanding under this facility.

7. DEBT

Our long-term debt consisted of:

April 30,	2010	2011
5.2% notes, due in fiscal 2012	$250	$252
5.0% notes, due in fiscal 2014	250	250
2.5% notes, due in fiscal 2016	–	249
Other	11	8
	511	759
Less current portion	3	255
	$508	$504

Debt payments required over the next five fiscal years consist of $253 in 2012, $3 in 2013, $253 in 2014, and $250 in 2016. (As discussed in Note 10, the carrying value of our debt includes adjustments related to interest rate swap contracts.) In addition to long-term debt, we had short-term borrowings outstanding with a weighted average interest rate of 0.2% at April 30, 2010.

8. FAIR VALUE MEASUREMENTS

Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date. We categorize the fair values of assets and liabilities into three levels based upon the assumptions (inputs) used to determine those values. Level 1 provides the most reliable measure of fair value, while Level 3 generally requires significant management judgment. The three levels are:

Level 1	Quoted prices (unadjusted) in active markets for identical assets or liabilities
Level 2	Observable inputs other than those in Level 1, such as: ·quoted prices for similar assets and liabilities in active markets; ·quoted prices for identical or similar assets and liabilities in markets that are not active; or ·other inputs that are observable or can be derived from or corroborated by observable market data
Level 3	Unobservable inputs that are supported by little or no market activity

This table summarizes the assets and liabilities measured at fair value on a recurring basis in the accompanying consolidated balance sheets:

	Level 1	Level 2	Level 3	Total
April 30, 2010:
Assets:
Currency derivatives	$–	$6	$–	$6
Liabilities:
Currency derivatives	–	6	–	6
April 30, 2011:
Assets:
Commodity derivatives	5	–	–	5
Interest rate swaps	–	3	–	3
Liabilities:
Currency derivatives	–	25	–	25

We determine the fair values of our commodity derivatives (futures and options) primarily using quoted contract prices on futures exchange markets. For these instruments, we use the closing contract price as of the balance sheet date. We determine the fair values of our currency derivatives (forwards and options) and interest rate swaps using standard valuation models. The significant inputs used in these models are readily available in public markets or can be derived from observable market transactions. Inputs used in these standard valuation models include the applicable exchange rate, forward rates and discount rates for the currency derivatives and include interest-rate yield curves for the interest rate swaps. The standard valuation model for foreign currency options also uses implied volatility as an additional input. The discount rates are based on the historical U.S. Treasury rates, and the implied volatility specific to individual foreign currency options is based on quoted rates from financial institutions.

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We measure some assets and liabilities at fair value on a nonrecurring basis; that is, we do not measure them at fair value on an ongoing basis, but we do adjust them to fair value in certain circumstances (for example, when we determine that an asset is impaired). The fair values of assets and liabilities measured at fair value on a nonrecurring basis during fiscal 2011 were not material as of April 30, 2011.

9. FAIR VALUE OF FINANCIAL INSTRUMENTS

The fair value of cash, cash equivalents, and short-term borrowings approximates the carrying amount due to the short maturities of these instruments. We estimate the fair value of long-term debt based on the prices at which similar debt has recently traded in the market and considering the overall market conditions on the date of valuation. We determine the fair value of derivative financial instruments as discussed in Note 8. Here is a comparison of the fair values and carrying amounts of these instruments:

April 30,	2010		2011
	Carrying	Fair	Carrying	Fair
	Amount	Value	Amount	Value
Assets:
Cash and cash equivalents	$232	$232	$567	$567
Commodity derivatives	–	–	5	5
Currency derivatives	6	6	–	–
Interest rate swaps	–	–	3	3
Liabilities:
Currency derivatives	6	6	25	25
Short-term borrowings	188	188	–	–
Current portion of long-term debt	3	3	255	265
Long-term debt	508	547	504	531

10. DERIVATIVE FINANCIAL INSTRUMENTS

Our multinational business exposes us to global market risks, including the effect of fluctuations in currency exchange rates, commodity prices, and interest rates. We use derivatives to help manage financial exposures that occur in the normal course of business. We formally document the purpose of each derivative contract, which includes linking the contract to the financial exposure it is designed to mitigate. We do not hold or issue derivatives for trading purposes.

We use currency derivative contracts to limit our exposure to the currency exchange risk that we cannot mitigate internally by using netting strategies. We designate most of these contracts as cash flow hedges of forecasted transactions (expected to occur within three years). We record all changes in the fair value of cash flow hedges (except any ineffective portion) in accumulated other comprehensive income (AOCI) until the underlying hedged transaction occurs, at which time we reclassify that amount into earnings. We designate some of our currency derivatives as hedges of net investments in foreign subsidiaries. We record all changes in the fair value of net investment hedges (except any ineffective portion) in the cumulative translation adjustment component of AOCI.

We assess the effectiveness of our hedges based on changes in forward exchange rates. The ineffective portion of the changes in fair value of our hedges (recognized immediately in earnings) during the periods presented in this report was not material.

We do not designate some of our currency derivatives as hedges because we use them to at least partially offset the immediate earnings impact of changes in foreign exchange rates on existing assets or liabilities. We immediately recognize the change in fair value of these contracts in earnings.

We had outstanding currency derivatives, related primarily to our euro, British pound, and Australian dollar exposures, with notional amounts totaling $400 and $392 at April 30, 2010 and 2011, respectively.

We also had outstanding exchange-traded futures and options contracts on approximately three million bushels of corn as of both April 30, 2010 and 2011. We use these contracts to mitigate our exposure to corn price volatility. Because we do not designate these contracts as hedges for accounting purposes, we immediately recognize changes in their fair value in earnings.

We manage our interest rate risk with swap contracts. We had fixed-to-floating interest rate swaps with total notional values of $250 and $375 outstanding as of April 30, 2010 and 2011, respectively, with maturities matching those of our bonds.  These swaps are designated as fair value hedges. The change in fair value of the swaps not related to accrued interest is offset by a corresponding adjustment to the carrying values of the bonds.

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The following table presents the fair values of our derivative instruments as of April 30, 2010 and 2011. The fair values are presented below on a gross basis, while the fair values of those instruments that are subject to master settlement arrangements are presented on a net basis in the accompanying consolidated balance sheets, in conformity with GAAP.

	Classification	Fair value of derivatives in a gain position	Fair value of derivatives in a loss position
April 30, 2010:
Designated as cash flow hedges:
Currency derivatives	Other current assets	$7	$(2)
Currency derivatives	Other assets	2	(1)
Currency derivatives	Accrued expenses	1	(6)
Currency derivatives	Other liabilities	–	(1)
Designated as net investment hedges:
Currency derivatives	Other current assets	–	(3)
Not designated as hedges:
Currency derivatives	Other current assets	3	–
April 30, 2011:
Designated as cash flow hedges:
Currency derivatives	Accrued expenses	–	(22)
Currency derivatives	Other liabilities	–	(6)
Designated as fair value hedges:
Interest rate swaps	Other current assets	2	–
Interest rate swaps	Other assets	1	–
Not designated as hedges:
Commodity derivatives	Other current assets	5	–
Currency derivatives	Accrued expenses	3	–

This table presents the amounts affecting our consolidated statements of operations in 2010 and 2011:

	Classification	2010	2011
Currency derivatives designated as cash flow hedges:
Net gain (loss) recognized in AOCI	n/a	$(19)	$(27)
Net gain (loss) reclassified from AOCI into income	Net sales	(16)	–
Interest rate swaps designated as fair value hedges:
Net gain (loss) recognized in income	Interest expense	–	3
Net gain (loss) recognized in income*	Other income	–	2
*The effect on the hedged item was an equal but offsetting amount for the periods presented.
Currency derivatives designated as net investment hedges:
Net gain (loss) recognized in AOCI	n/a	(8)	(1)
Derivatives not designated as hedging instruments:
Currency derivatives – net gain (loss) recognized in income	Net sales	(8)	(10)
Currency derivatives – net gain (loss) recognized in income	Other income	1	(2)
Commodity derivatives – net gain (loss) recognized in income	Cost of sales	(1)	10

We expect to reclassify $18 of deferred net losses recorded in AOCI as of April 30, 2011, to earnings during fiscal 2012. This reclassification would offset the anticipated earnings impact of the underlying hedged exposures. The actual amounts that we ultimately reclassify to earnings will depend on the exchange rates in effect when the underlying hedged transactions occur. The maximum term of outstanding derivative contracts was 27 months and 24 months at April 30, 2010 and 2011, respectively.

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Credit risk. We are exposed to credit-related losses if the other parties to our derivative contracts breach them. This credit risk is limited to the fair value of the contracts. To manage this risk, we enter into contracts only with major financial institutions that have earned investment-grade credit ratings; we have established counterparty credit guidelines that are regularly monitored and that provide for reports to senior management according to prescribed guidelines; and we monetize contracts when we believe it is warranted. Because of these safeguards, we believe the risk of loss from counterparty default to be immaterial.

Some of our derivative instruments require us to maintain a specific level of creditworthiness, which we have maintained. If our creditworthiness were to fall below that level, then the counterparties to our derivative instruments could request immediate payment or collateralization for derivative instruments in net liability positions. The aggregate fair value of all derivatives with creditworthiness requirements that were in a net liability position was $4 and $22 at April 30, 2010 and 2011, respectively.

11. PENSION AND OTHER POSTRETIREMENT BENEFITS

We sponsor various defined benefit pension plans as well as postretirement plans providing retiree health care and retiree life insurance benefits. Below, we discuss our obligations related to these plans, the assets dedicated to meeting the obligations, and the amounts we recognized in our financial statements as a result of sponsoring these plans.

On April 30, 2007, we adopted new guidance regarding the accounting for these plans. That guidance included a provision requiring that, beginning in fiscal 2009, the assumptions used to measure annual pension and other postretirement benefit expenses be determined as of the balance sheet date, and that the amounts of benefit plan obligations and assets reported in annual financial statements be measured as of the balance sheet date. Accordingly, as of the beginning of our 2009 fiscal year, we changed the measurement date for our annual pension and other postretirement benefit expenses and all plan assets and liabilities from January 31 to April 30. As a result of this change in measurement date, we recorded an increase of $6 (net of tax of $4) to stockholders’ equity as of May 1, 2008, as follows:

	Pension Benefits	Medical and Life Insurance Benefits	Total Benefits
Retained earnings	$(2)	$(1)	$(3)
Accumulated other comprehensive income	8	1	9
Total	$6	$–	$6

Obligations. We provide eligible employees with pension and other postretirement benefits based on factors such as years of service and compensation level during employment. The pension obligation shown below (“projected benefit obligation”) consists of: (a) benefits earned by employees to date based on current salary levels (“accumulated benefit obligation”); and (b) benefits to be received by employees as a result of expected future salary increases. (The obligation for medical and life insurance benefits is not affected by future salary increases.) This table shows how the present value of our obligation changed during each of the last two years.

	Pension		Medical and Life
	Benefits		Insurance Benefits
	2010	2011	2010	2011
Obligation at beginning of year	$415	$577	$44	$58
Service cost	10	16	1	1
Interest cost	32	33	3	3
Net actuarial loss (gain)	143	10	12	(10)
Plan amendments	–	–	–	6
Retiree contributions	–	–	2	2
Benefits paid	(23)	(24)	(4)	(4)
Special termination benefits	–	1	–	–
Obligation at end of year	$577	$613	$58	$56

Service cost represents the present value of the benefits attributed to service rendered by employees during the year. Interest cost is the increase in the present value of the obligation due to the passage of time. Net actuarial loss (gain) is the change in value of the obligation resulting from experience different from that assumed or from a change in an actuarial assumption. (We discuss actuarial assumptions used at the end of this note.)

As shown in the previous table, our pension and other postretirement benefit obligations were reduced by benefit payments in 2011 of $24 and $4, respectively. Expected benefit payments (net of retiree contributions) over the next 10 years are as follows:

	Pension Benefits	Medical and Life Insurance Benefits
2012	$25	$3
2013	26	3
2014	28	3
2015	29	3
2016	30	3
2017–2021	179	18

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Assets. We specifically invest in certain assets to fund our pension benefit obligations. Our investment goal is to earn a total return that, over time, will grow assets sufficiently to fund our plans’ liabilities, after providing appropriate levels of contributions and accepting prudent levels of investment risk. To achieve this goal, plan assets are invested primarily in funds or portfolios of funds actively managed by outside managers. Investment risk is managed by company policies that require diversification of asset classes, manager styles, and individual holdings. We measure and monitor investment risk through quarterly and annual performance reviews, and through periodic asset/liability studies.

Asset allocation is the most important method for achieving our investment goals and is based on our assessment of the plans’ long-term return objectives and the appropriate balances needed for liquidity, stability, and diversification. This table shows the fair value of pension plan assets by category, as well as the actual and target allocations, as of April 30, 2010 and 2011.(Fair value levels are defined in Note 8.)

					Allocation by Asset Class
	Level 1	Level 2	Level 3	Total	Actual	Target
April 30, 2010:
Commingled trust funds(a):
Equity funds	$–	$176	$–	$176	50%	47%
Fixed income funds	–	117	–	117	33%	30%
Real estate funds	–	14	10	24	7%	8%
Total commingled trust funds	–	307	10	317	90%	85%
Hedge funds(b)	–	–	19	19	5%	5%
Private equity(c)	–	–	13	13	4%	5%
Cash and temporary investments(d)	2	–	–	2	1%	–
Other	–	–	–	–	–	5%
Total	$2	$307	$42	$351	100%	100%
April 30, 2011:
Commingled trust funds:
Equity funds	$–	$232	$–	$232	50%	47%
Fixed income funds	–	166	–	166	35%	35%
Real estate funds	–	18	9	27	6%	8%
Total commingled trust funds	–	416	9	425	91%	90%
Hedge funds	–	–	24	24	5%	5%
Private equity	–	–	16	16	3%	5%
Cash and temporary investments	2	–	–	2	1%	–
Total	$2	$416	$49	$467	100%	100%

(a) Commingled trust fund valuations are based on the net asset value (NAV) of the funds as determined by the administrator of the fund and reviewed by us. NAV represents the underlying assets owned by the fund, minus liabilities and divided by the number of shares or units outstanding.

(b) Hedge fund valuations are primarily based on the NAV of the funds as determined by the administrator of the fund and reviewed by us. During our review, we determine whether it is necessary to adjust the valuation for inherent liquidity and redemption issues that may exist within the fund’s underlying assets or fund unit values.

(c) As of April 30, 2010 and 2011, consists only of limited partnership interests, which are valued at the percentage ownership of total partnership equity as determined by the general partner. These valuations require significant judgment due to the absence of quoted market prices, the inherent lack of liquidity, and the long-term nature of these investments.

(d) Cash and temporary investments consist of money market funds and are valued at their respective NAVs as determined by those funds each business day.

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This table shows how the fair value of the Level 3 assets changed during each of the last two years.

	Real
	Estate	Hedge	Private
	Funds	Funds	Equity	Total
Balance as of May 1, 2009	$15	$4	$13	$32
Return on assets held at end of year	(4)	1	–	(3)
Return on assets sold during year	–	(1)	(1)	(2)
Purchases and settlements	–	17	2	19
Sales and settlements	(1)	(2)	(1)	(4)
Balance as of April 30, 2010	10	19	13	42
Return on assets held at end of year	2	1	1	4
Return on assets sold during year	–	(1)	–	(1)
Purchases and settlements	–	6	4	10
Sales and settlements	(3)	(1)	(2)	(6)
Balance as of April 30, 2011	$9	$24	$16	$49

This table shows how the total fair value of all pension plan assets changed during each of the last two years. (We do not have assets set aside for postretirement medical or life insurance benefits.)

	Pension		Medical and Life
	Benefits		Insurance Benefits
	2010	2011	2010	2011
Fair value at beginning of year	$284	$351	$–	$–
Actual return on plan assets	77	64	–	–
Retiree contributions	–	–	2	2
Company contributions	13	76	2	2
Benefits paid	(23)	(24)	(4)	(4)
Fair value at end of year	$351	$467	$–	$–

Consistent with our funding policy, we expect to contribute $3 to our postretirement medical and life insurance benefit plans in 2012. While we may decide to contribute more, we currently expect to contribute $40 to our pension plans in 2012.

Funded status. The funded status of a plan refers to the difference between its assets and its obligations. This table shows the funded status of our plans.

	Pension		Medical and Life
	Benefits		Insurance Benefits
	2010	2011	2010	2011
Assets	$351	$467	$–	$–
Obligations	(577)	(613)	(58)	(56)
Funded status	$(226)	$(146)	$(58)	$(56)

The funded status is recorded on the accompanying consolidated balance sheets as follows:

	Pension		Medical and Life
	Benefits		Insurance Benefits
	2010	2011	2010	2011
Other assets	$5	$7	$–	$–
Accounts payable and accrued expenses	(3)	(3)	(3)	(3)
Accrued postretirement benefits	(228)	(150)	(55)	(53)
Net liability	$(226)	$(146)	$(58)	$(56)
Accumulated other comprehensive loss:
Net actuarial loss (gain)	$299	$263	$7	$(3)
Prior service cost	4	3	1	6
	$303	$266	$8	$3

This table compares our pension plans that have assets in excess of their accumulated benefit obligations with those whose assets are less than their obligations. (As discussed above, we have no assets set aside for postretirement medical or life insurance benefits.)

			Accumulated		Projected
			Benefit		Benefit
	Plan Assets		Obligation		Obligation
	2010	2011	2010	2011	2010	2011
Plans with assets in excess of accumulated benefit obligation	$45	$50	$38	$41	$40	$42
Plans with accumulated benefit obligation in excess of assets	306	417	476	505	537	571
Total	$351	$467	$514	$546	$577	$613

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Pension expense. This table shows the components of the pension expense recognized during each of the last three years. The amount for each year includes amortization of the prior service cost and net actuarial loss included in accumulated other comprehensive loss as of the beginning of the year.

	Pension Benefits
	2009	2010	2011
Service cost	$13	$10	$16
Interest cost	30	32	33
Special termination benefits	1	–	1
Expected return on plan assets	(35)	(34)	(36)
Amortization of:
Prior service cost	1	1	1
Net actuarial loss	6	4	18
Net expense	$16	$13	$33

The prior service cost represents the cost of retroactive benefits granted in plan amendments and is amortized on a straight-line basis over the average remaining service period of the employees expected to receive the benefits. The net actuarial loss results from experience different from that assumed or from a change in actuarial assumptions (including the difference between actual and expected return on plan assets), and is amortized over at least that same period. The estimated amount of prior service cost and net actuarial loss that will be amortized from accumulated other comprehensive loss into pension expense in 2012 is $1 and $19, respectively.

Other postretirement benefit expense. This table shows the components of the postretirement medical and life insurance benefit expense that we recognized during each of the last three years.

	Medical and Life Insurance Benefits
	2009	2010	2011
Service cost	$1	$1	$1
Interest cost	3	3	3
Net expense	$4	$4	$4

Other comprehensive income. Changes in the funded status of our benefit plans that are not recognized in net income (as pension and other postretirement benefit expense) are instead recognized in other comprehensive income. Other comprehensive income is also adjusted to reflect the amortization of the prior service cost and net actuarial gain or loss, which is a component of net pension and other postretirement benefit expense, from accumulated other comprehensive income (loss) to net income. This table shows the amounts recognized in other comprehensive income during each of the last three years:

	Pension			Medical and Life
	Benefits			Insurance Benefits
	2009	2010	2011	2009	2010	2011
Prior service cost	$1	$–	$–	$–	$–	$5
Actuarial loss (gain)	92	100	(18)	(9)	12	(10)
Amortization reclassified to net income:
Prior service cost	(1)	(1)	(1)	–	–	–
Net actuarial loss	(6)	(4)	(18)	–	–	–
Net amount recognized in other comprehensive income	$86	$95	$(37)	$(9)	$12	$(5)

Assumptions and sensitivity. We use various assumptions to determine the obligations and expense related to our pension and other postretirement benefit plans. The assumptions used in computing benefit plan obligations as of the end of the last two years were as follows:

	Pension		Medical and Life
	Benefits		Insurance Benefits
	2010	2011	2010	2011
Discount rate	5.91%	5.67%	5.78%	5.59%
Rate of salary increase	4.00%	4.00%	n/a	n/a

Here are the assumptions we used in computing benefit plan expense during each of the last three years:

	Pension			Medical and Life
	Benefits			Insurance Benefits
	2009	2010	2011	2009	2010	2011
Discount rate	6.87%	7.94%	5.91%	6.87%	7.80%	5.78%
Rate of salary increase	4.00%	4.00%	4.00%	n/a	n/a	n/a
Expected return on plan assets	8.75%	8.50%	8.50%	n/a	n/a	n/a

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The discount rate represents the interest rate used to discount the cash-flow stream of benefit payments to a net present value as of the current date. A lower assumed discount rate increases the present value of the benefit obligation. We determined the discount rate using a yield curve based on the interest rates of high-quality debt securities with maturities corresponding to the expected timing of our benefit payments.

The assumed rate of salary increase reflects the expected average annual increase in salaries as a result of inflation, merit increases, and promotions over the service period of the plan participants. A lower assumed rate decreases the present value of the benefit obligation.

The expected return on plan assets represents the long-term rate of return that we assume will be earned over the life of the pension assets. The assumption reflects expected capital market returns for each asset class, which are based on historical returns, adjusted for the expected effects of diversification and active management (net of fees).

The assumed health care cost trend rates as of the end of the last two years were as follows:

	Medical and Life
	Insurance Benefits
	2010	2011
Health care cost trend rate assumed for next year:
Present rate before age 65	8.0%	7.5%
Present rate age 65 and after	8.0%	7.5%

We project health care cost trend rates to decline gradually to 5.0% by 2016 and to remain level after that. Assumed health care cost trend rates have a significant effect on the amounts reported for postretirement medical plans. A 1% increase/decrease in assumed health care cost trend rates would have increased/decreased the accumulated postretirement benefit obligation as of April 30, 2011, by $6 and the aggregate service and interest costs for 2011 by $1.

Savings plans. We also sponsor various defined contribution benefit plans that in total cover substantially all U.S. employees. Employees can make voluntary contributions in accordance with their respective plans, which include a 401(k) tax deferral option. We match a percentage of each employee’s contributions in accordance with the plans’ terms. We expensed $10, $8, and $9 for matching contributions during 2009, 2010, and 2011, respectively.

International plans. The information presented above for defined benefit plans and defined contribution benefit plans reflects amounts for U.S. plans only. Information about similar international plans is not presented due to immateriality.

12. STOCK-BASED COMPENSATION

Under our 2004 Omnibus Compensation Plan, we can grant stock-based incentive awards for a total of 7,433,000 shares of common stock to eligible employees until July 22, 2014. As of April 30, 2011, awards for 4,265,000 shares remain available for issuance under the Plan. Shares delivered to employees are limited by the Plan to shares that we purchase for this purpose. No new shares may be issued.

The following table presents information about stock options and SSARs granted under the Plan as of April 30, 2011, and for the year then ended:

	Number of Underlying Shares (in thousands)	Weighted Average Exercise Price per Award	Weighted Average Remaining Contractual Term (years)	Aggregate Intrinsic Value
Outstanding at May 1, 2010	4,051	$41.31
Granted	415	61.24
Exercised	(738)	30.26
Forfeited or expired	(22)	49.52
Outstanding at April 30, 2011	3,706	$45.69	5.0	$97
Exercisable at April 30, 2011	2,470	$41.77	3.6	$74

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The total intrinsic value of options and SSARs exercised during 2009, 2010, and 2011 was $17, $18, and $25, respectively.

We grant stock options and SSARs at an exercise price of not less than the fair value of the underlying stock on the grant date. Stock options and SSARs granted under the Plan become exercisable after three years from the first day of the fiscal year of grant and expire seven years after that date. The grant-date fair values of these awards granted during 2009, 2010, and 2011 were $11.24, $9.42, and $12.66 per award, respectively. Fair values were estimated using the Black-Scholes pricing model with the following assumptions:

	2009	2010	2011
Risk-free interest rate	3.5%	3.0%	2.1%
Expected volatility	18.1%	22.6%	23.7%
Expected dividend yield	1.8%	1.9%	1.9%
Expected life (years)	6	6	6

We also grant restricted stock units (RSUs), deferred stock units (DSUs), and shares of restricted stock under the Plan. Approximately 82,000 shares underlying these awards, with a weighted-average remaining restriction period of 1.8 years, were outstanding at April 30, 2011. The following table summarizes the changes in outstanding RSUs, DSUs, and restricted stock during 2011:

	Number of Underlying Shares (in thousands)	Weighted Average Fair Value at Grant Date
Outstanding at May 1, 2010	176	$50.59
Granted	28	61.14
Vested	(122)	51.21
Outstanding at April 30, 2011	82	$53.28

The total fair value of RSUs, DSUs, and restricted stock vested during 2009, 2010, and 2011 was $3, $2, and $9, respectively.

As previously announced, we paid a special cash dividend of $1.00 per share on Class A and Class B common stock in December 2010. According to the terms of the Plan, we adjusted the exercise price and number of stock options, SSARs and RSUs outstanding on the ex-distribution date in order to avoid the reduction in value of those awards that would otherwise have occurred as a result of the special dividend.  The number of awards, exercise price per award, and grant-date fair value per award presented above reflect these adjustments.

The accompanying consolidated statements of operations reflect compensation expense related to stock-based incentive awards on a pre-tax basis of $7 in 2009, $8 in 2010, and $9 in 2011, partially offset by deferred income tax benefits of $3 in 2009, $3 in 2010, and $4 in 2011. As of April 30, 2011, there was $9 of total unrecognized compensation cost related to non-vested stock-based compensation. That cost is expected to be recognized over a weighted-average period of 2.0 years.

13. RESTRUCTURING COSTS

In April 2009, we accrued $12 in costs related to our decision to reduce our workforce through involuntary employment termination and voluntary early retirement. That amount, which is reflected in selling, general, and administrative expenses, consisted of severance and other special termination benefits. We incurred no material additional expenses as a result of this reduction in workforce, which was completed in fiscal 2009, and we paid substantially all of the accrued amount during fiscal 2010.

14. OTHER INCOME AND EXPENSE

In fiscal 2009, we recognized a gain of $20 on the sale of the Bolla and Fontana Candida trademarks. In fiscal 2010, we recorded an impairment charge of $12 related to the Don Eduardo trademark (Note 3). These amounts are reflected as other (income) expense in the accompanying consolidated statements of operations.

In March 2011, we agreed to sell Fetzer Vineyards to Chilean wine producer Viña Concha y Toro. This agreement followed the December 2010 announcement that we were exploring strategic alternatives for our Hopland, California-based wine assets, including a possible sale.

We completed this transaction on April 15, 2011, at a sales price (subject to a post-closing working capital adjustment) of $234 in cash. As a result, we recognized a gain on sale (net of transaction costs and income taxes) of $38, which is reflected in the accompanying consolidated statement of operations as follows:

Net sales	$(3)
Selling, general, and administrative expenses	(6)
Other income	62
Income taxes	(15)
Net gain	$38

The sale included the Fetzer winery, bottling facility, and vineyards, as well as the Fetzer brand and other Hopland, California-based wines, including Bonterra, Little Black Dress, Jekel, Five Rivers, Bel Arbor, Coldwater Creek, and Sanctuary.  Also included in the sale was a facility in Paso Robles, California.

65

15. INCOME TAXES

We incur income taxes on the earnings of our U.S. and foreign operations. The following table, based on the locations of the taxable entities from which sales were derived (rather than the location of customers), presents the U.S. and foreign components of our income before income taxes:

	2009	2010	2011
United States	$533	$576	$696
Foreign	97	106	133
	$630	$682	$829

The income shown above was determined according to financial accounting standards. Because those standards sometimes differ from the tax rules used to calculate taxable income, there are differences between: (a) the amount of taxable income and pretax financial income for a year; and (b) the tax bases of assets or liabilities and their amounts as recorded in our financial statements. As a result, we recognize a current tax liability for the estimated income tax payable on the current tax return, and deferred tax liabilities (income tax payable on income that will be recognized on future tax returns) and deferred tax assets (income tax refunds from deductions that will be recognized on future tax returns) for the estimated effects of the differences mentioned above.

Deferred tax assets and liabilities as of the end of each of the last two years were as follows:

April 30,	2010	2011
Deferred tax assets:
Postretirement and other benefits	$125	$94
Accrued liabilities and other	26	22
Loss and credit carryforwards	56	50
Valuation allowance	(40)	(23)
Total deferred tax assets, net	167	143
Deferred tax liabilities:
Trademarks and brand names	(168)	(195)
Property, plant, and equipment	(37)	(46)
Total deferred tax liabilities, net	(205)	(241)
Net deferred tax liability	$(38)	$(98)

The $23 valuation allowance at April 30, 2011 relates primarily to a $13 non-trading loss carryforward generated by Brown-Forman Beverages Europe during fiscal 2009 in the U.K. Although the non-trading losses can be carried forward indefinitely, we know of no significant transactions that will let us use them. The remaining valuation allowance relates primarily to other foreign net operating losses, some of which can be carried forward indefinitely, and others that expire between fiscal 2018 and 2020. We are currently unaware of any significant transactions that will allow us to utilize these losses. During fiscal 2011, we used all of our U.S. capital loss carryforward to offset gains on the sales of Fetzer and Paso Robles. As a result, we reversed the $20 valuation allowance that was recorded at April 30, 2010 related to this item.

As of April 30, 2011, the gross amounts of loss and credit carryforwards include a U.K. non-trading loss of $47 (no expiration); other foreign net operating losses of $56 ($25 of which expire in varying amounts between 2014 and 2021 and $31 of which do not expire); and foreign credit carryforwards of $8 (expiring between fiscal 2012 and 2017).

Deferred tax liabilities were not provided on undistributed earnings of certain foreign subsidiaries ($365 and $390 at April 30, 2010 and 2011, respectively) because we expect these undistributed earnings to be reinvested indefinitely overseas. If these amounts were not considered permanently reinvested, additional deferred tax liabilities of approximately $73 and $76 would have been provided as of April 30, 2010 and 2011, respectively.

Total income tax expense for a year includes the tax associated with the current tax return (“current tax expense”) and the change in the net deferred tax asset or liability (“deferred tax expense”). Our total income tax expense for each of the last three years was as follows:

	2009	2010	2011
Current:
U.S. federal	$142	$175	$171
Foreign	26	28	41
State and local	15	19	18
	183	222	230
Deferred:
U.S. federal	$14	$16	$46
Foreign	(2)	(5)	(1)
State and local	–	–	(18)
	12	11	27
	$195	$233	$257

66

Our consolidated effective tax rate usually differs from current statutory rates due to the recognition of amounts for events or transactions that have no tax consequences. The following table reconciles our effective tax rate to the federal statutory tax rate in the United States:

	Percent of Income Before Taxes
	2009	2010	2011
U.S. federal statutory rate	35.0%	35.0%	35.0%
State taxes, net of U.S. federal tax benefit	1.8	1.8	1.1
Income taxed at other than U.S. federal statutory rate	(1.3)	(1.0)	(0.4)
Tax benefit from U.S. manufacturing	(1.7)	(1.7)	(2.2)
Capital loss benefit	(1.2)	–	(2.7)
Nondeductible goodwill on Fetzer sale	–	–	2.1
Other, net	(1.5)	–	(1.9)
Effective rate	31.1%	34.1%	31.0%

During the fourth quarter of fiscal 2011, we recorded an adjustment to reverse $8 of income tax expense that was incorrectly recognized in prior periods. We believe the impact of this error and the cumulative out of period adjustment to correct the error is insignificant to our consolidated financial statements for the current period and any prior periods.

At April 30, 2011, we had $40 of gross unrecognized tax benefits, $22 of which would reduce our effective income tax rate if recognized. A reconciliation of the beginning and ending unrecognized tax benefits follows:

	2009	2010	2011
Unrecognized tax benefits at beginning of year	$35	$26	$35
Additions for tax positions provided in prior periods	1	–	1
Additions for tax positions provided in current period	4	13	14
Decreases for tax positions provided in prior years	–	–	(4)
Settlements of tax positions in the current period	(2)	(3)	(5)
Lapse of statutes of limitations	(12)	(1)	(1)
Unrecognized tax benefits at end of year	$26	$35	$40

We record interest and penalties related to unrecognized tax benefits as a component of our income tax provision. Total gross interest and penalties of $6, $8 and $11 were accrued as of April 30, 2009, 2010 and 2011, respectively. The impact of interest and penalties on our effective tax rates for 2009, 2010 and 2011 was not material.

We file income tax returns in the United States, including several state and local jurisdictions, as well as in several other countries in which we conduct business. The major jurisdictions and their earliest fiscal years that are currently open for tax examinations are 1998 in the United States, 2007 in Australia, Ireland, and Italy, 2005 in Poland and Finland, 2003 in the U.K. and 2002 in Mexico. Audits of our fiscal 2006 and 2007 U.S. federal tax returns were completed during fiscal 2010. In addition, audits of our fiscal 2008, 2009, and 2010 U.S. federal tax returns commenced during fiscal 2011. Moreover, the Internal Revenue Service has accepted our application to participate in its Compliance Assurance Program for our fiscal 2012 tax year.

We believe there will be no material change in our gross unrecognized tax benefits in the next twelve months.

16. SEGMENT INFORMATION

The following table presents net sales by product category:

	2009	2010	2011
Net sales:
Spirits	$2,832	$2,916	$3,102
Wine	360	310	302
	$3,192	$3,226	$3,404

The following table presents net sales by geographic region:

	2009	2010	2011
Net sales:
United States	$1,542	$1,529	$1,525
Europe	892	879	909
Other	758	818	970
	$3,192	$3,226	$3,404

Net sales are attributed to countries based on where customers are located.

The net book value of property, plant, and equipment located in Mexico was $62 and $65 as of April 30, 2010 and 2011, respectively. Other long-lived assets located outside the United States are not significant.

67

REPORTS OF MANAGEMENT

MANAGEMENT'S RESPONSIBILITY FOR FINANCIAL STATEMENTS

Our management is responsible for the preparation, presentation, and integrity of the financial information presented in this Annual Report. The consolidated financial statements were prepared in conformity with accounting principles generally accepted in the U.S., including amounts based on management's best estimates and judgments. In management's opinion, the consolidated financial statements fairly present the Company's financial position, results of operations, and cash flows.

The Audit Committee of the Board of Directors, which is composed of independent directors, meets regularly with the independent registered public accounting firm, PricewaterhouseCoopers LLP (PwC), internal auditors, and representatives of management to review accounting, internal control structure, and financial reporting matters. The internal auditors and PwC have full, free access to the Audit Committee. As set forth in our Code of Conduct and Compliance Guidelines, we are firmly committed to adhering to the highest standards of moral and ethical behaviors in our business activities.

MANAGEMENT'S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING

Management is also responsible for establishing and maintaining adequate internal control over financial reporting, as defined in Rule 13a-15(f) under the Securities Exchange Act of 1934. Our internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with accounting principles generally accepted in the U.S.

As of the end of our fiscal year, management conducted an assessment of the effectiveness of the Company's internal control over financial reporting based on the framework and criteria in Internal Control – Integrated Framework issued by the Committee of Sponsoring  Organizations of the Treadway Commission.  Based on this assessment, management concluded that the Company's internal control over financial reporting was effective as of April 30, 2011.

There has been no change in the Company's internal control over financial reporting during the fiscal quarter ended April 30, 2011 that has materially affected, or is reasonably likely to materially affect, the Company's internal control over financial reporting. The effectiveness of the Company's internal control over financial reporting as of April 30, 2011, has been audited by PwC, as stated in their report that appears on page 69.

/s/ Paul C. Varga

Paul C. Varga

Chairman and Chief Executive Officer

/s/ Donald C. Berg

Donald C. Berg

Executive Vice President and Chief Financial Officer

68

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

TO THE BOARD OF DIRECTORS AND STOCKHOLDERS OF BROWN-FORMAN CORPORATION:

In our opinion, the accompanying consolidated balance sheets and the related consolidated  statements of operations, comprehensive income, cash flows, and stockholders' equity present fairly, in all material respects, the financial position of Brown-Forman Corporation and its subsidiaries (the "Company") at April 30, 2011 and April 30, 2010, and the results of their operations and their cash flows for each of the three years in the period ended April 30, 2011 in conformity with accounting principles generally accepted in the United States of America. Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of April 30, 2011, based on criteria established in Internal Control - Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The Company's management is responsible for these financial statements, for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in Management's Report on Internal Control over Financial Reporting appearing on page 68 of this Annual Report to Stockholders. Our responsibility is to express opinions on these financial statements and on the Company's internal control over financial reporting based on our integrated audits. We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement and whether effective internal control over financial reporting was maintained in all material respects. Our audits of the financial statements included examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances.  We believe that our audits provide a reasonable basis for our opinions.

A company's internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company's internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that  transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company's assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

/s/ PricewaterhouseCoopers LLP

Louisville, Kentucky

June 27, 2011

69

IMPORTANT INFORMATION ON FORWARD-LOOKING STATEMENTS

This report contains statements, estimates, and projections that are "forward-looking statements" as defined under U.S. federal securities laws. Words such as “aim,” “anticipate,” “aspire,” “believe,” “envision,” “estimate,” “expect,” “expectation,” “intend,” “may,” “potential,” “project,” “pursue,” “see,” “will,” “will continue,” and similar words identify forward-looking statements, which speak only as of the date we make them. Except as required by law, we do not intend to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.  By their nature, forward-looking statements involve risks, uncertainties and other factors (many beyond our control) that could cause our actual results to differ materially from our historical experience or from our current expectations or projections. These risks and other factors include, but are not limited to:

·   declining or depressed economic conditions in our markets; political, financial, or credit or capital market instability; supplier, customer or consumer credit or other financial problems; bank failures or governmental debt defaults or nationalizations

·   failure to develop or  implement effective business and brand strategies and innovations, including route-to-consumer, and marketing and promotional activity

·   unfavorable trade or consumer reaction to our new products, product line extensions, or changes in formulation, packaging or pricing

·   inventory fluctuations in our products by distributors, wholesalers, or retailers

·   competitors’ pricing actions (including price reductions, promotions, discounting, couponing or free goods), marketing, category expansion, product introductions, entry or expansion in our markets, or other competitive activities

·   declines in consumer confidence or spending, whether related to the economy (such as austerity measures, tax increases, high fuel costs, or higher unemployment), wars, natural or other disasters, weather, pandemics, security concerns, terrorist attacks or other factors

·   changes in tax rates (including excise, sales, VAT, tariffs, duties, corporate, individual income, dividends, capital gains) or in related reserves, changes in tax rules (e.g., LIFO, foreign income deferral, U.S. manufacturing and other deductions) or accounting standards, or other restrictions affecting beverage alcohol, and the unpredictability and suddenness with which they can occur

·   governmental or other restrictions on our ability to produce, import, sell, price, or market our products, including advertising and promotion in either traditional or new media; regulatory compliance costs

·   business disruption, decline or costs related to reductions in workforce or other cost-cutting measures

·   lower returns or discount rates related to pension assets, interest rate fluctuations, inflation or deflation

·   fluctuations in the U.S. dollar against foreign currencies, especially the euro, British pound, Australian dollar, or Polish zloty

·   changes in consumer behavior or preferences and our ability to anticipate and respond to them, including societal attitudes or cultural trends that result in reduced consumption of our products; reduction of bar, restaurant, hotel or other on-premise business or travel

·   consumer shifts away from spirits or premium-priced spirits products; shifts to discount store purchases or other price-sensitive consumer behavior

·   distribution and other route-to-consumer decisions or changes that affect the timing of our sales, temporarily disrupt the marketing or sale of our products, or result in implementation-related costs

·   effects of acquisitions, dispositions, joint ventures, business partnerships or investments, or portfolio strategies, including integration costs, disruption or other difficulties, or impairment in the recorded value of assets (e.g. receivables, inventory, fixed assets, goodwill, trademarks and other intangibles)

·   lower profits, due to factors such as fewer or less profitable used barrel sales, lower production volumes, decreased demand for products we sell, sales mix shift toward lower priced or lower margin SKUs, or cost increases in energy or raw materials, such as grain, agave, wood, glass, plastic, or closures

·   natural disasters, climate change, agricultural uncertainties, environmental or other catastrophes, our suppliers’ financial hardships or other factors that affect the availability, price, or quality of agave, grain, glass, energy, closures, plastic, water, wood, or finished goods

·   negative publicity related to our company, brands, marketing, personnel, operations, business performance or prospects

·   product counterfeiting, tampering, contamination, or recalls and resulting negative effects on our sales, brand equity, or corporate reputation

·   significant costs or other adverse developments stemming from class action, intellectual property, governmental, or other major litigation; or governmental investigations of beverage alcohol industry business, trade, or marketing practices by us, our importers, distributors, or retailers

70

QUARTERLY FINANCIAL INFORMATION

(Expressed in millions, except per share amounts)

	Fiscal 2010					Fiscal 2011
	First	Second	Third	Fourth		First	Second	Third	Fourth
	Quarter	Quarter	Quarter	Quarter	Year	Quarter	Quarter	Quarter	Quarter	Year
Net sales	$738	$893	$862	$733	$3,226	$745	$906	$962	$791	$3,404
Gross profit	380	443	411	377	1,611	379	459	463	423	1,724
Net income	121	147	108	73	449	111	154	141	165	572
Basic EPS	0.81	0.99	0.73	0.49	3.03	0.76	1.06	0.97	1.14	3.92
Diluted EPS	0.81	0.99	0.73	0.49	3.02	0.76	1.05	0.96	1.13	3.90
Cash dividends per share:
Declared	0.58	–	0.60	–	1.18	0.60	–	1.64	–	2.24
Paid	0.29	0.29	0.30	0.30	1.18	0.30	0.30	1.32	0.32	2.24
Market price per share:
Class A high	51.08	53.30	57.75	63.65	63.65	65.13	65.55	71.88	73.34	73.34
Class A low	44.00	45.45	50.50	51.55	44.00	54.63	54.72	60.54	65.04	54.63
Class B high	50.00	53.78	55.56	60.44	60.44	65.05	65.03	73.00	73.73	73.73
Class B low	41.45	42.22	47.77	48.93	41.45	53.22	54.25	60.45	65.18	53.22

Note: Quarterly amounts may not add to amounts for the year due to rounding.

71

EX-21

Exhibit 21

SUBSIDIARIES OF THE REGISTRANT

	Percentage of	State or Jurisdiction
Name	Securities Owned	Of Incorporation
AMG Trading, L.L.C.	100%	Delaware
B-F Korea, L.L.C.	100%	Delaware
Brown-Forman Arrow Continental Europe, L.L.C.	100%	Kentucky
Brown-Forman Australia Pty. Ltd.	100%	Australia
Brown-Forman Beverages Japan, L.L.C.	100%	Delaware
Brown-Forman Beverages North Asia, L.L.C.	100%	Delaware
Brown-Forman Italy, Inc.	100%	Kentucky
Brown-Forman Thailand, L.L.C.	100%	Delaware
Canadian Mist Distillers, Limited	100%	Ontario, Canada
Chambord Liqueur Royale de France	100%	France
Early Times Distillers Company	100%	Delaware
Finlandia Vodka Worldwide Ltd.	100%	Finland
Heddon’s Gate Investments, Inc.	100%	Delaware
Jack Daniel’s Properties, Inc.	100%	Delaware
Limited Liability Company Brown-Forman Ukraine	100%	Ukraine
Sonoma-Cutrer Vineyards, Inc.	100%	California
Southern Comfort Properties, Inc.	100%	California
Washington Investments, L.L.C.	100%	Kentucky
Woodford Reserve Stables, L.L.C.	100%	Kentucky
Longnorth Limited	100% (1) (2)	Ireland
Clintock Limited	100% (1) (3)	Ireland
Brown-Forman Netherlands, B.V.	100% (2)	Netherlands
BFC Tequila Limited	100% (3)	Ireland
Jack Daniel Distillery, Lem Motlow, Prop., Inc.	100% (4)	Tennessee
Brown-Forman Korea Ltd.	100% (5)	Korea
Brown-Forman Worldwide (Shanghai) Co., Ltd.	100% (6)	China
Brown-Forman Czech & Slovak Republics, s.r.o.	100% (7)	Czech Republic
Brown-Forman Polska Sp. z  o.o.	100% (7)	Poland
Brown-Forman Beverages Worldwide, Comercio de Bebidas Ltda.	100% (8)	Brazil
Brown-Forman Worldwide, L.L.C.	100% (8)	Delaware
Amercain Investments, C.V.	100% (9)	Netherlands
Brown-Forman Holding Mexico S.A. de C.V.	100% (10)	Mexico
Distillerie Tuoni e Canepa Srl	100% (11)	Italy
Brown-Forman Beverages Europe, Ltd.	100% (12)	United Kingdom
Brown-Forman Dutch Holding, B.V.	100% (12)	Netherlands
Brown-Forman Spirits Trading, L.L.C.	100% (13)	Turkey
Brown-Forman Tequila Mexico, S. de R.L. de C.V.	100% (14)	Mexico
Valle de Amatitan, S.A. de C.V.	100% (14)	Mexico
Cosesa-BF S. de R.L. de C.V.	100% (15)	Mexico

The companies listed above constitute all active subsidiaries in which Brown-Forman Corporation owns, either directly or indirectly, the majority of the voting securities.  No other active affiliated companies are controlled by Brown-Forman Corporation.

(1)	Includes qualifying shares assigned to Brown-Forman Corporation.
(2)	Owned by Amercain Investments C.V.
(3)	Owned by Longnorth Limited.
(4)	Owned by Jack Daniel’s Properties, Inc.
(5)	Owned by B-F Korea, L.L.C.
(6)	Owned by Brown-Forman Beverages North Asia, L.L.C.
(7)	Owned 81.8% by Brown-Forman Netherlands, B.V. and 18.2% by Brown-Forman Beverages Europe, Ltd.
(8)	Owned 99% by Brown-Forman Corporation and 1% by Early Times Distillers Company.
(9)	Owned 90% by Brown-Forman Corporation and 10% by Heddon’s Gate Investments, Inc.
(10)	Owned 52.01% by Brown-Forman Netherlands, B.V. and 47.99% by Brown-Forman Corporation.
(11)	Owned 37% by Brown-Forman Netherlands, B.V. and 63% by Brown-Forman Italy, Inc.
(12)	Owned by Brown-Forman Netherlands, B.V.
(13)	Owned 90% by AMG Trading, L.L.C. and 10% by Brown-Forman Worldwide, L.L.C.
(14)	Owned 99% by Brown-Forman Holding Mexico S.A. de C.V. and 1% by Early Times Distillers Company.
(15)	Owned 99.9972% by Brown-Forman Holding Mexico S.A. de C.V. and 0.00277% by Early Times Distillers Company.

EX-23

Exhibit 23

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We hereby consent to the incorporation by reference in the Registration Statement on Form S-3 (Nos. 333-171126, 333-140317, and 33-52551) and Form S-8 (Nos. 333-08311, 333-38649, 333-74567, 333-77903, 333-88925, 333-89294, 333-126988, 333-117630, and 333-169564) of Brown-Forman Corporation of our report dated June 27, 2011 relating to the financial statements and the effectiveness of internal control over financial reporting, which appears in the 2011 Annual Report to Stockholders, which is incorporated in this Annual Report on Form 10-K.  We also consent to the incorporation by reference of our report dated June 27, 2011 relating to the financial statement schedule, which appears in this Form 10-K.

/s/ PricewaterhouseCoopers LLP

PricewaterhouseCoopers LLP

Louisville, KY

June 27, 2011

EX-31.1

 Exhibit 31.1

CERTIFICATION PURSUANT TO SECTION 302 OF SARBANES-OXLEY ACT OF 2002

I, Paul C. Varga, certify that:

1.   I have reviewed this Annual Report on Form 10-K of Brown-Forman Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report.

4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a)   Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b)   Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c)   Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d)   Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

a)   All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b)   Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date:  June 27, 2011	By:	/s/ Paul C. Varga
		Paul C. Varga
		Chief Executive Officer

EX-31.2

 Exhibit 31.2

CERTIFICATION PURSUANT TO SECTION 302 OF SARBANES-OXLEY ACT OF 2002

I, Donald C. Berg, certify that:

1.   I have reviewed this Annual Report on Form 10-K of Brown-Forman Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report.

4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a)   Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b)   Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c)   Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d)   Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

a)   All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

b)   Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date:  June 27, 2011	By:	/s/ Donald C. Berg
		Donald C. Berg
		Chief Financial Officer

EX-32

 Exhibit 32

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Annual Report of Brown-Forman Corporation (“the Company”) on Form 10-K for the period ended April 30, 2011 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), each of the undersigned hereby certifies, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, in the capacity as an officer of the Company, that:

(1) The Report fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Dated: June 27, 2011

/s/ Paul C. Varga	/s/ Donal C. Berg
Paul C. Varga	Donald C. Berg
Chief Executive Officer and Chairman of the Company	Executive Vice President and Chief Financial Officer

A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

This certificate is being furnished solely for purposes of Section 906 and is not being filed as part of the Report.

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Document and Entity Information (USD $)	12 Months Ended
	Apr. 30, 2011	Oct. 31, 2010	Jun. 20, 2011 Common Class A [Member]	Jun. 20, 2011 Common Stock, Class B, nonvoting [Member]
Entity Registrant Name	BROWN FORMAN CORP
Entity Central Index Key	0000014693
Document Type	10-K
Document Period End Date	Apr. 30, 2011
Amendment Flag	false
Document Fiscal Year Focus	2011
Document Fiscal Period Focus	FY
Current Fiscal Year End Date	--04-30
Entity Well-known Seasoned Issuer	Yes
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Entity Public Float		$ 5,200,000,000
Entity Common Stock, Shares Outstanding			56,534,863	88,362,029

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Accounting Policies

12 Months Ended

Apr. 30, 2011

Accounting Policies [Abstract]

ACCOUNTING POLICIES

1. ACCOUNTING POLICIES

We prepare our consolidated financial statements in conformity with accounting principles generally accepted in the United States (GAAP). We also apply the following accounting policies when preparing our consolidated financial statements:

Principles of consolidation. Our consolidated financial statements include the accounts of all wholly owned and majority-owned subsidiaries. We use the equity method to account for investments in affiliates over which we can exercise significant influence (but not control). We carry all other investments in affiliates at cost. We eliminate all intercompany transactions.

Cash equivalents. Cash equivalents include bank demand deposits and all highly liquid investments with original maturities of three months or less.

Allowance for doubtful accounts. We evaluate the collectability of accounts receivable based on a combination of factors. When we are aware of circumstances that may impair a specific customer’s ability to meet its financial obligations, we record a specific allowance to reduce the net recognized receivable to the amount we believe will be collected. We write off the uncollectible amount against the allowance when we have exhausted our collection efforts.

Inventories. We state inventories at the lower of cost or market, with approximately 63% of consolidated inventories being valued using the last-in, first-out (LIFO) method. We value the remainder primarily using the first-in, first-out (FIFO) method. FIFO cost approximates current replacement cost. If we had used the FIFO method for all inventories, they would have been $219 and $204 higher than reported at April 30, 2010 and 2011, respectively.

Whiskey must be barrel-aged for several years, so we bottle and sell only a portion of our whiskey inventory each year. Following industry practice, we classify all barreled whiskey as a current asset. We include warehousing, insurance, ad valorem taxes, and other carrying charges applicable to barreled whiskey in inventory costs.

We classify bulk wine and agave inventories as work in process.

During 2009, we recorded a $22 provision for inventory losses (included in cost of sales) resulting from abnormally high levels of mortality and disease in some of our agave fields.

Property, plant, and equipment. We state property, plant, and equipment at cost less accumulated depreciation. We calculate depreciation on a straight-line basis using our estimates of useful life, which are 20—40 years for buildings and improvements; 3—10 years for machinery, equipment, vehicles, furniture, and fixtures; and 3—7 years for capitalized software.

We assess our property, plant, and equipment for impairment whenever events or changes in circumstances indicate that the carrying value of those assets may not be recoverable. When we do not expect to recover the carrying value of an asset (or asset group) through undiscounted future cash flows, we write it down to its estimated fair value. We determine fair value using discounted estimated future cash flows, considering market values for similar assets when available.

Upon disposal or retirement of property, plant, and equipment, we remove its cost and accumulated depreciation from our balance sheet. Any gain or loss is reflected in operating income. We expense the cost of repairing and maintaining our property, plant, and equipment as costs are incurred.

Goodwill and other intangible assets. We have obtained most of our brands by acquiring other companies. Upon acquisition, the purchase price is first allocated to identifiable assets and liabilities, including intangible brand names and trademarks (“brand names”), based on estimated fair value, with any remaining purchase price recorded as goodwill. We do not amortize goodwill or intangible assets with indefinite lives. We consider all of our brand names to have indefinite lives.

We assess our goodwill and other indefinite-lived intangible assets for impairment at least annually. If the fair value of an asset is less than its book value, we write it down to its estimated fair value. Goodwill is evaluated for impairment if the book value of its reporting unit exceeds its estimated fair value. We estimate the fair value of a reporting unit using discounted estimated future cash flows. We typically estimate the fair value of a brand name using the “relief from royalty” method. We also consider market values for similar assets when available. Considerable management judgment is necessary to estimate fair value, including the selection of assumptions about future cash flows, discount rates, and royalty rates.

Foreign currency translation. The U.S. dollar is the functional currency for most of our consolidated operations. For those operations, we report all gains and losses from foreign currency transactions in current income. The local currency is the functional currency for some foreign operations. For those investments, we report cumulative translation effects as a component of accumulated other comprehensive income (loss), a component of stockholders’ equity.

Revenue recognition. We recognize revenue when title and risk of loss pass to the customer, typically when the product is shipped. Some sales contracts contain customer acceptance provisions that grant a right of return on the basis of either subjective or objective criteria. We record revenue net of the estimated cost of sales returns and allowances.

Sales discounts. Sales discounts, which are recorded as a reduction of net sales, totaled $328, $398, and $461 for 2009, 2010, and 2011, respectively.

Excise taxes. Our sales are subject to excise taxes, which we collect from our customers and remit to governmental authorities. We present these taxes on a gross basis (included in net sales and costs before gross profit) in the consolidated statement of operations.

Cost of sales. Cost of sales includes the costs of receiving, producing, inspecting, warehousing, insuring, and shipping goods sold during the period.

Shipping and handling fees and costs. We report the amounts we bill to our customers for shipping and handling as net sales, and we report the costs we incur for shipping and handling as cost of sales.

Advertising costs. We expense the costs of advertising during the year when the advertisements first take place.

Selling, general, and administrative expenses. Selling, general, and administrative expenses include the costs associated with our sales force, administrative staff and facilities, and other expenses related to our non-manufacturing functions.

Income taxes. We base our annual provision for income taxes on the pre-tax income reflected in our consolidated statement of operations. We establish deferred tax liabilities or assets for temporary differences between financial and tax reporting bases and subsequently adjust them to reflect changes in tax rates expected to be in effect when the temporary differences reverse. We record a valuation allowance as necessary to reduce a deferred tax to the amount that we believe is more likely than not to be realized. We do not provide deferred income taxes on undistributed earnings of foreign subsidiaries that we expect to permanently reinvest.

We assess our uncertain income tax positions using a two-step process. First, we evaluate whether the tax position will more likely than not, based on its technical merits, be sustained upon examination, including resolution of any related appeals or litigation. For a tax position that does not meet this first criterion, we recognize no tax benefit. For a tax position that does meet the first criterion, we recognize a tax benefit in an amount equal to the largest amount of benefit that we believe has more than a 50% likelihood of being realized upon ultimate resolution.

Earnings per share. We calculate basic earnings per share by dividing net income available to common stockholders by the weighted average number of all unrestricted common shares outstanding during the period. Diluted earnings per share further includes the dilutive effect of stock options, stock-settled appreciation rights (SSARs), restricted stock units (RSUs), and deferred stock units (DSUs). We calculate that dilutive effect using the “treasury stock method” (as defined by GAAP).

We have granted restricted shares of common stock to certain employees as part of their compensation. These restricted shares, which have varying vesting periods, contain non-forfeitable rights to dividends declared on common stock. As a result, the unvested restricted shares are considered participating securities in the calculation of earnings per share in accordance with a new accounting standard that we adopted retrospectively effective May 1, 2009. The adoption decreased previously reported basic earnings per share for 2009 from $2.89 to $2.88.

The following table presents information concerning basic and diluted earnings per share:

	2009			2010			2011
Basic and diluted net income	$	435		$	449		$	572
Income allocated to participating securities (restricted shares)		(1	)		(1	)		(1	)
Net income available to common stockholders	$	434		$	448		$	571
Share data (in thousands):
Basic average common shares outstanding		150,452			147,834			145,603
Dilutive effect of stock options, SSARs, RSUs, and DSUs		927			741			910
Diluted average common shares outstanding		151,379			148,575			146,513
Basic earnings per share	$	2.88		$	3.03		$	3.92
Diluted earnings per share	$	2.87		$	3.02		$	3.90

SSARs for approximately 1,899,000 common shares, 824,000 common shares, and 350,000 common shares were excluded from the calculation of diluted earnings per share for 2009, 2010, and 2011, respectively, because they were not dilutive for those periods under the treasury stock method.

Stock distribution. In September 2008, our Board of Directors authorized a stock split, effected as a stock dividend, of one share of Class B common stock for every four shares of either Class A or Class B common stock held by stockholders of record as of the close of business on October 6, 2008, with fractional shares paid in cash. The distribution took place on October 27, 2008. As a result of the stock distribution, we reclassified approximately $5 from our retained earnings to our common stock account. The $5 represents the $0.15 par value per share of the shares issued in the stock distribution.

Stock-based compensation. Our stock-based compensation plan requires that we purchase shares to satisfy stock-based compensation requirements, thereby avoiding future dilution of earnings that would occur from issuing additional shares. We acquire treasury shares from time to time in anticipation of these requirements. We intend to hold enough treasury stock so that the number of diluted shares never exceeds the original number of shares outstanding at the inception of the stock-based compensation plan (as adjusted for any share issuances unrelated to the plan). The extent to which the number of diluted shares exceeds the number of basic shares is determined by how much our stock price has appreciated since the stock-based compensation was awarded, not by how many treasury shares we have acquired.

Estimates. To prepare financial statements that conform with generally accepted accounting principles, our management must make informed estimates that affect how we report revenues, expenses, assets, and liabilities, including contingent assets and liabilities. Actual results could (and probably will) differ from these estimates.

Recent accounting pronouncements. During fiscal 2011, we adopted new guidance for disclosures about allowances for doubtful accounts and about fair value measurements. Adopting this new accounting guidance had no material impact on our financial statements.

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Balance Sheet Information

12 Months Ended

Apr. 30, 2011

Balance Sheet Information [Abstract]

BALANCE SHEET INFORMATION

2. BALANCE SHEET INFORMATION

Supplemental information on our year-end balance sheets is as follows:

April 30,	2010		2011
Other current assets:
Prepaid taxes	$	99	$	129
Other		85		89
	$	184	$	218
Property, plant, and equipment:
Land	$	89	$	69
Buildings		349		317
Equipment		491		446
Construction in process		15		11
		944		843
Less accumulated depreciation		476		450
	$	468	$	393
Accounts payable and accrued expenses:
Accounts payable, trade	$	97	$	126
Accrued expenses:
Advertising		55		72
Compensation and commissions		90		81
Excise and other non-income taxes		43		54
Self-insurance claims		12		11
Postretirement benefits		6		6
Interest		4		7
Other		35		55
		245		286
	$	342	$	412

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Goodwill and Other Intangible Assets

12 Months Ended

Apr. 30, 2011

Goodwill and Other Intangible Assets [Abstract]

GOODWILL AND OTHER INTANGIBLE ASSETS

3. GOODWILL AND OTHER INTANGIBLE ASSETS

The following table shows the changes in the amounts recorded as goodwill (which includes no accumulated impairment losses) over the past two years:

Balance as of April 30, 2009	$	675
Foreign currency translation adjustment and other		(9	)
Balance as of April 30, 2010		666
Disposal of Hopland-based wine business (Note 14)		(49	)
Foreign currency translation adjustment		8
Balance as of April 30, 2011	$	625

As of April 30, 2010 and 2011, our other intangible assets consisted of:

	Gross Carrying				Accumulated
	Amount				Amortization
	2010		2011		2010			2011
Finite-lived intangible assets:
Distribution rights	$	25	$	25	$	(17	)	$	(22	)
Indefinite-lived intangible assets:
Trademarks and brand names		661		667		—			—

Amortization expense related to intangible assets was $5 during each of the last three fiscal years. We expect to recognize amortization expense of $3 in fiscal 2012.

As discussed in Note 1, we assess each of our indefinite-lived intangible assets for impairment at least annually. During fiscal 2010, our assessment indicated that the book value of one of our brand names, Don Eduardo, exceeded its fair value by $12. As a result, we wrote down the book value of the Don Eduardo brand name by that amount, which is reflected in other expense in the accompanying consolidated statement of operations. The remaining book value of the Don Eduardo brand name is not material. The decline in its value reflected a significant reduction in estimated future net sales for this low-volume, high-priced tequila brand that had in part been affected by the downturn in the global economic environment that began during the second half of calendar 2008.

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Commitments

12 Months Ended

Apr. 30, 2011

Commitments [Abstract]

COMMITMENTS

4. COMMITMENTS

We made rental payments for real estate, vehicles, and office, computer, and manufacturing equipment under operating leases of $21 in 2009, $22 in 2010, and $22 in 2011. We have commitments related to minimum lease payments of $17 in 2012, $10 in 2013, $7 in 2014, $4 in 2015, and $1 in 2016.

We have contracted with various growers and wineries to supply some of our future grape and bulk wine requirements. Many of these contracts call for prices to be adjusted annually up or down, according to market conditions. Some contracts set a fixed purchase price that might be higher or lower than prevailing market price. We have total purchase obligations related to both types of contracts of $4 in 2012, $3 in 2013, and $3 in 2014.

We also have contracts for the purchase of agave, which is used to produce tequila. These contracts provide for prices to be determined based on market conditions at the time of harvest, which, although not specified, is expected to occur over the next 10 years. As of April 30, 2011, based on current market prices, obligations under these contracts totaled $4.

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Contingencies

12 Months Ended

Apr. 30, 2011

Contingencies [Abstract]

CONTINGENCIES

5. CONTINGENCIES

We operate in a litigious environment, and we are sued in the normal course of business. Sometimes plaintiffs seek substantial damages. Significant judgment is required in predicting the outcome of these suits and claims, many of which take years to adjudicate. We accrue estimated costs for a contingency when we believe that a loss is probable and we can make a reasonable estimate of the loss, and then adjust the accrual as appropriate to reflect changes in facts and circumstances. We do not believe these loss contingencies, individually or in the aggregate, would have a material adverse effect on our financial position, results of operations, or liquidity. No material accrued loss contingencies are recorded as of April 30, 2011.

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Credit Facilities

12 Months Ended

Apr. 30, 2011

Credit Facilities [Abstract]

CREDIT FACILITIES

6. CREDIT FACILITIES

We have a committed revolving credit agreement with various U.S. and international banks for $800 that expires on April 30, 2012. Its most restrictive covenant requires that our consolidated EBITDA (as defined in the agreement) to consolidated interest expense not be less than a ratio of 3 to 1. At April 30, 2011, we were well within this covenant’s parameters and had no borrowing outstanding under this facility.

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Debt

12 Months Ended

Apr. 30, 2011

Debt [Abstract]

DEBT

7. DEBT

Our long-term debt consisted of:

April 30,	2010		2011
5.2% notes, due in fiscal 2012	$	250	$	252
5.0% notes, due in fiscal 2014		250		250
2.5% notes, due in fiscal 2016		—		249
Other		11		8
		511		759
Less current portion		3		255
	$	508	$	504

Debt payments required over the next five fiscal years consist of $253 in 2012, $3 in 2013, $253 in 2014, and $250 in 2016. (As discussed in Note 10, the carrying value of our debt includes adjustments related to interest rate swap contracts.) In addition to long-term debt, we had short-term borrowings outstanding with a weighted average interest rate of 0.2% at April 30, 2010.

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Fair Value Measurements

12 Months Ended

Apr. 30, 2011

Fair Value Measurements [Abstract]

FAIR VALUE MEASUREMENTS

8. FAIR VALUE MEASUREMENTS

Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date. We categorize the fair values of assets and liabilities into three levels based upon the assumptions (inputs) used to determine those values. Level 1 provides the most reliable measure of fair value, while Level 3 generally requires significant management judgment. The three levels are:

Level 1 Quoted prices (unadjusted) in active markets for identical assets or liabilities

Level 2 Observable inputs other than those in Level 1, such as:

• quoted prices for similar assets and liabilities in active markets;

• quoted prices for identical or similar assets and liabilities in markets that are not active; or

• other inputs that are observable or can be derived from or corroborated by observable market data

Level 3 Unobservable inputs that are supported by little or no market activity

This table summarizes the assets and liabilities measured at fair value on a recurring basis in the accompanying consolidated balance sheets:

	Level 1		Level 2		Level 3		Total
April 30, 2010:
Assets:
Currency derivatives	$	—	$	6	$	—	$	6
Liabilities:
Currency derivatives		—		6		—		6
April 30, 2011:
Assets:
Commodity derivatives		5		—		—		5
Interest rate swaps		—		3		—		3
Liabilities:
Currency derivatives		—		25		—		25

We determine the fair values of our commodity derivatives (futures and options) primarily using quoted contract prices on futures exchange markets. For these instruments, we use the closing contract price as of the balance sheet date. We determine the fair values of our currency derivatives (forwards and options) and interest rate swaps using standard valuation models. The significant inputs used in these models are readily available in public markets or can be derived from observable market transactions. Inputs used in these standard valuation models include the applicable exchange rate, forward rates and discount rates for the currency derivatives and include interest-rate yield curves for the interest rate swaps. The standard valuation model for foreign currency options also uses implied volatility as an additional input. The discount rates are based on the historical U.S. Treasury rates, and the implied volatility specific to individual foreign currency options is based on quoted rates from financial institutions.

We measure some assets and liabilities at fair value on a nonrecurring basis; that is, we do not measure them at fair value on an ongoing basis, but we do adjust them to fair value in certain circumstances (for example, when we determine that an asset is impaired). The fair values of assets and liabilities measured at fair value on a nonrecurring basis during fiscal 2011 were not material as of April 30, 2011.

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Fair Value of Financial Instruments

12 Months Ended

Apr. 30, 2011

Fair Value of Financial Instruments [Abstract]

FAIR VALUE OF FINANCIAL INSTRUMENTS

9. FAIR VALUE OF FINANCIAL INSTRUMENTS

The fair value of cash, cash equivalents, and short-term borrowings approximates the carrying amount due to the short maturities of these instruments. We estimate the fair value of long-term debt based on the prices at which similar debt has recently traded in the market and considering the overall market conditions on the date of valuation. We determine the fair value of derivative financial instruments as discussed in Note 8. Here is a comparison of the fair values and carrying amounts of these instruments:

April 30,	2010				2011
	Carrying		Fair		Carrying		Fair
	Amount		Value		Amount		Value
Assets:
Cash and cash equivalents	$	232	$	232	$	567	$	567
Commodity derivatives		—		—		5		5
Currency derivatives		6		6		—		—
Interest rate swaps		—		—		3		3
Liabilities:
Currency derivatives		6		6		25		25
Short-term borrowings		188		188		—		—
Current portion of long-term debt		3		3		255		265
Long-term debt		508		547		504		531

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Derivative Financial Instruments

12 Months Ended

Apr. 30, 2011

Derivative Financial Instruments [Abstract]

DERIVATIVE FINANCIAL INSTRUMENTS

10. DERIVATIVE FINANCIAL INSTRUMENTS

Our multinational business exposes us to global market risks, including the effect of fluctuations in currency exchange rates, commodity prices, and interest rates. We use derivatives to help manage financial exposures that occur in the normal course of business. We formally document the purpose of each derivative contract, which includes linking the contract to the financial exposure it is designed to mitigate. We do not hold or issue derivatives for trading purposes.

We use currency derivative contracts to limit our exposure to the currency exchange risk that we cannot mitigate internally by using netting strategies. We designate most of these contracts as cash flow hedges of forecasted transactions (expected to occur within three years). We record all changes in the fair value of cash flow hedges (except any ineffective portion) in accumulated other comprehensive income (AOCI) until the underlying hedged transaction occurs, at which time we reclassify that amount into earnings. We designate some of our currency derivatives as hedges of net investments in foreign subsidiaries. We record all changes in the fair value of net investment hedges (except any ineffective portion) in the cumulative translation adjustment component of AOCI.

We assess the effectiveness of our hedges based on changes in forward exchange rates. The ineffective portion of the changes in fair value of our hedges (recognized immediately in earnings) during the periods presented in this report was not material.

We do not designate some of our currency derivatives as hedges because we use them to at least partially offset the immediate earnings impact of changes in foreign exchange rates on existing assets or liabilities. We immediately recognize the change in fair value of these contracts in earnings.

We had outstanding currency derivatives, related primarily to our euro, British pound, and Australian dollar exposures, with notional amounts totaling $400 and $392 at April 30, 2010 and 2011, respectively.

We also had outstanding exchange-traded futures and options contracts on approximately three million bushels of corn as of both April 30, 2010 and 2011. We use these contracts to mitigate our exposure to corn price volatility. Because we do not designate these contracts as hedges for accounting purposes, we immediately recognize changes in their fair value in earnings.

We manage our interest rate risk with swap contracts. We had fixed-to-floating interest rate swaps with total notional values of $250 and $375 outstanding as of April 30, 2010 and 2011, respectively, with maturities matching those of our bonds. These swaps are designated as fair value hedges. The change in fair value of the swaps not related to accrued interest is offset by a corresponding adjustment to the carrying values of the bonds.

The following table presents the fair values of our derivative instruments as of April 30, 2010 and 2011. The fair values are presented below on a gross basis, while the fair values of those instruments that are subject to master settlement arrangements are presented on a net basis in the accompanying consolidated balance sheets, in conformity with GAAP.

		Fair value of		Fair value of
		derivatives in a		derivatives in a
	Classification	gain position		loss position
April 30, 2010:
Designated as cash flow hedges:
Currency derivatives	Other current assets	$	7	$	(2	)
Currency derivatives	Other assets		2		(1	)
Currency derivatives	Accrued expenses		1		(6	)
Currency derivatives	Other liabilities		—		(1	)
Designated as net investment hedges:
Currency derivatives	Other current assets		—		(3	)
Not designated as hedges:
Currency derivatives	Other current assets		3		—
April 30, 2011:
Designated as cash flow hedges:
Currency derivatives	Accrued expenses		—		(22	)
Currency derivatives	Other liabilities		—		(6	)
Designated as fair value hedges:
Interest rate swaps	Other current assets		2		—
Interest rate swaps	Other assets		1		—
Not designated as hedges:
Commodity derivatives	Other current assets		5		—
Currency derivatives	Accrued expenses		3		—

This table presents the amounts affecting our consolidated statements of operations in 2010 and 2011:

	Classification	2010			2011
Currency derivatives designated as cash flow hedges:
Net gain (loss) recognized in AOCI	n/a	$	(19	)	$	(27	)
Net gain (loss) reclassified from AOCI into income	Net sales		(16	)		—
Interest rate swaps designated as fair value hedges:
Net gain (loss) recognized in income	Interest expense		—			3
Net gain (loss) recognized in income*	Other income		—			2

*  The effect on the hedged item was an equal but offsetting amount for the periods presented.

Currency derivatives designated as net investment hedges:
Net gain (loss) recognized in AOCI	n/a	(8	)	(1	)
Derivatives not designated as hedging instruments:
Currency derivatives — net gain (loss) recognized in income	Net sales	(8	)	(10	)
Currency derivatives — net gain (loss) recognized in income	Other income	1		(2	)
Commodity derivatives — net gain (loss) recognized in income	Cost of sales	(1	)	10

We expect to reclassify $18 of deferred net losses recorded in AOCI as of April 30, 2011, to earnings during fiscal 2012. This reclassification would offset the anticipated earnings impact of the underlying hedged exposures. The actual amounts that we ultimately reclassify to earnings will depend on the exchange rates in effect when the underlying hedged transactions occur. The maximum term of outstanding derivative contracts was 27 months and 24 months at April 30, 2010 and 2011, respectively.

Credit risk. We are exposed to credit-related losses if the other parties to our derivative contracts breach them. This credit risk is limited to the fair value of the contracts. To manage this risk, we enter into contracts only with major financial institutions that have earned investment-grade credit ratings; we have established counterparty credit guidelines that are regularly monitored and that provide for reports to senior management according to prescribed guidelines; and we monetize contracts when we believe it is warranted. Because of these safeguards, we believe the risk of loss from counterparty default to be immaterial.

Some of our derivative instruments require us to maintain a specific level of creditworthiness, which we have maintained. If our creditworthiness were to fall below that level, then the counterparties to our derivative instruments could request immediate payment or collateralization for derivative instruments in net liability positions. The aggregate fair value of all derivatives with creditworthiness requirements that were in a net liability position was $4 and $22 at April 30, 2010 and 2011, respectively.

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Consolidated Statements of Operations (USD $) In Millions, except Per Share data	12 Months Ended
	Apr. 30, 2011	Apr. 30, 2010	Apr. 30, 2009
Consolidated Statements of Operations [Abstract]
Net sales	$ 3,404	$ 3,226	$ 3,192
Excise taxes	818	757	711
Cost of sales	862	858	904
Gross profit	1,724	1,611	1,577
Advertising expenses	366	350	383
Selling, general, and administrative expenses	574	539	548
Amortization expense	5	5	5
Other (income) expense, net	(76)	7	(20)
Operating income	855	710	661
Interest income	3	3	6
Interest expense	29	31	37
Income before income taxes	829	682	630
Income taxes	257	233	195
Net income	$ 572	$ 449	$ 435
Earnings per share:
Basic	$ 3.92	$ 3.03	$ 2.88
Diluted	$ 3.90	$ 3.02	$ 2.87

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Pension and Other Postretirement Benefits

12 Months Ended

Apr. 30, 2011

Pension and Other Postretirement Benefits [Abstract]

PENSION AND OTHER POSTRETIREMENT BENEFITS

11. PENSION AND OTHER POSTRETIREMENT BENEFITS

We sponsor various defined benefit pension plans as well as postretirement plans providing retiree health care and retiree life insurance benefits. Below, we discuss our obligations related to these plans, the assets dedicated to meeting the obligations, and the amounts we recognized in our financial statements as a result of sponsoring these plans.

On April 30, 2007, we adopted new guidance regarding the accounting for these plans. That guidance included a provision requiring that, beginning in fiscal 2009, the assumptions used to measure annual pension and other postretirement benefit expenses be determined as of the balance sheet date, and that the amounts of benefit plan obligations and assets reported in annual financial statements be measured as of the balance sheet date. Accordingly, as of the beginning of our 2009 fiscal year, we changed the measurement date for our annual pension and other postretirement benefit expenses and all plan assets and liabilities from January 31 to April 30. As a result of this change in measurement date, we recorded an increase of $6 (net of tax of $4) to stockholders’ equity as of May 1, 2008, as follows:

	Pension			Medical and Life			Total
	Benefits			Insurance Benefits			Benefits
Retained earnings	$	(2	)	$	(1	)	$	(3	)
Accumulated other comprehensive income		8			1			9
Total	$	6		$	—		$	6

Obligations. We provide eligible employees with pension and other postretirement benefits based on factors such as years of service and compensation level during employment. The pension obligation shown below (“projected benefit obligation”) consists of: (a) benefits earned by employees to date based on current salary levels (“accumulated benefit obligation”); and (b) benefits to be received by employees as a result of expected future salary increases. (The obligation for medical and life insurance benefits is not affected by future salary increases.) This table shows how the present value of our obligation changed during each of the last two years.

	Pension						Medical and Life
	Benefits						Insurance Benefits
	2010			2011			2010			2011
Obligation at beginning of year	$	415		$	577		$	44		$	58
Service cost		10			16			1			1
Interest cost		32			33			3			3
Net actuarial loss (gain)		143			10			12			(10	)
Plan amendments		—			—			—			6
Retiree contributions		—			—			2			2
Benefits paid		(23	)		(24	)		(4	)		(4	)
Special termination benefits		—			1			—			—
Obligation at end of year	$	577		$	613		$	58		$	56

Service cost represents the present value of the benefits attributed to service rendered by employees during the year. Interest cost is the increase in the present value of the obligation due to the passage of time. Net actuarial loss (gain) is the change in value of the obligation resulting from experience different from that assumed or from a change in an actuarial assumption. (We discuss actuarial assumptions used at the end of this note.)

As shown in the previous table, our pension and other postretirement benefit obligations were reduced by benefit payments in 2011 of $24 and $4, respectively. Expected benefit payments (net of retiree contributions) over the next 10 years are as follows:

	Pension	Medical and Life
	Benefits	Insurance Benefits
2012	$25	$3
2013	26	3
2014	28	3
2015	29	3
2016	30	3
2017—2021	179	18

Assets. We specifically invest in certain assets to fund our pension benefit obligations. Our investment goal is to earn a total return that, over time, will grow assets sufficiently to fund our plans’ liabilities, after providing appropriate levels of contributions and accepting prudent levels of investment risk. To achieve this goal, plan assets are invested primarily in funds or portfolios of funds actively managed by outside managers. Investment risk is managed by company policies that require diversification of asset classes, manager styles, and individual holdings. We measure and monitor investment risk through quarterly and annual performance reviews, and through periodic asset/liability studies.

Asset allocation is the most important method for achieving our investment goals and is based on our assessment of the plans’ long-term return objectives and the appropriate balances needed for liquidity, stability, and diversification. This table shows the fair value of pension plan assets by category, as well as the actual and target allocations, as of April 30, 2010 and 2011. (Fair value levels are defined in Note 8.)

									Allocation by Asset Class
	Level 1		Level 2		Level 3		Total		Actual			Target
April 30, 2010:
Commingled trust funds(a):
Equity funds	$	—	$	176	$	—	$	176		50	%		47	%
Fixed income funds		—		117		—		117		33	%		30	%
Real estate funds		—		14		10		24		7	%		8	%
Total commingled trust funds		—		307		10		317		90	%		85	%
Hedge funds(b)		—		—		19		19		5	%		5	%
Private equity(c)		—		—		13		13		4	%		5	%
Cash and temporary investments(d)		2		—		—		2		1	%		—
Other		—		—		—		—		—			5	%
Total	$	2	$	307	$	42	$	351		100	%		100	%
April 30, 2011:
Commingled trust funds:
Equity funds	$	—	$	232	$	—	$	232		50	%		47	%
Fixed income funds		—		166		—		166		35	%		35	%
Real estate funds		—		18		9		27		6	%		8	%

Total commingled trust funds		—		416		9		425	91	%	90	%
Hedge funds		—		—		24		24	5	%	5	%
Private equity		—		—		16		16	3	%	5	%
Cash and temporary investments		2		—		—		2	1	%	—
Total	$	2	$	416	$	49	$	467	100	%	100	%

(a)	Commingled trust fund valuations are based on the net asset value (NAV) of the funds as determined by the administrator of the fund and reviewed by us. NAV represents the underlying assets owned by the fund, minus liabilities and divided by the number of shares or units outstanding.
(b)	Hedge fund valuations are primarily based on the NAV of the funds as determined by the administrator of the fund and reviewed by us. During our review, we determine whether it is necessary to adjust the valuation for inherent liquidity and redemption issues that may exist within the fund’s underlying assets or fund unit values.
(c)	As of April 30, 2010 and 2011, consists only of limited partnership interests, which are valued at the percentage ownership of total partnership equity as determined by the general partner. These valuations require significant judgment due to the absence of quoted market prices, the inherent lack of liquidity, and the long-term nature of these investments.
(d)	Cash and temporary investments consist of money market funds and are valued at their respective NAVs as determined by those funds each business day.

This table shows how the fair value of the Level 3 assets changed during each of the last two years.

	Real Estate			Hedge			Private
	Funds			Funds			Equity			Total
Balance as of May 1, 2009	$	15		$	4		$	13		$	32
Return on assets held at end of year		(4	)		1			—			(3	)
Return on assets sold during year		—			(1	)		(1	)		(2	)
Purchases and settlements		—			17			2			19
Sales and settlements		(1	)		(2	)		(1	)		(4	)
Balance as of April 30, 2010		10			19			13			42
Return on assets held at end of year		2			1			1			4
Return on assets sold during year		—			(1	)		—			(1	)
Purchases and settlements		—			6			4			10
Sales and settlements		(3	)		(1	)		(2	)		(6	)
Balance as of April 30, 2011	$	9		$	24		$	16		$	49

This table shows how the total fair value of all pension plan assets changed during each of the last two years. (We do not have assets set aside for postretirement medical or life insurance benefits.)

	Pension						Medical and Life
	Benefits						Insurance Benefits
	2010			2011			2010			2011
Fair value at beginning of year	$	284		$	351		$	—		$	—
Actual return on plan assets		77			64			—			—
Retiree contributions		—			—			2			2
Company contributions		13			76			2			2
Benefits paid		(23	)		(24	)		(4	)		(4	)
Fair value at end of year	$	351		$	467		$	—		$	—

Consistent with our funding policy, we expect to contribute $3 to our postretirement medical and life insurance benefit plans in 2012. While we may decide to contribute more, we currently expect to contribute $40 to our pension plans in 2012.

Funded status. The funded status of a plan refers to the difference between its assets and its obligations. This table shows the funded status of our plans.

	Pension						Medical and Life
	Benefits						Insurance Benefits
	2010			2011			2010			2011
Assets	$	351		$	467		$	—		$	—
Obligations		(577	)		(613	)		(58	)		(56	)
Funded status	$	(226	)	$	(146	)	$	(58	)	$	(56	)

The funded status is recorded on the accompanying consolidated balance sheets as follows:

	Pension						Medical and Life
	Benefits						Insurance Benefits
	2010			2011			2010			2011
Other assets	$	5		$	7		$	—		$	—
Accounts payable and accrued expenses		(3	)		(3	)		(3	)		(3	)
Accrued postretirement benefits		(228	)		(150	)		(55	)		(53	)
Net liability	$	(226	)	$	(146	)	$	(58	)	$	(56	)
Accumulated other comprehensive loss:
Net actuarial loss (gain)	$	299		$	263		$	7		$	(3	)
Prior service cost		4			3			1			6
	$	303		$	266		$	8		$	3

This table compares our pension plans that have assets in excess of their accumulated benefit obligations with those whose assets are less than their obligations. (As discussed above, we have no assets set aside for postretirement medical or life insurance benefits.)

					Accumulated				Projected
					Benefit				Benefit
	Plan Assets				Obligation				Obligation
	2010		2011		2010		2011		2010		2011
Plans with assets in excess of accumulated benefit obligation	$	45	$	50	$	38	$	41	$	40	$	42
Plans with accumulated benefit obligation in excess of assets		306		417		476		505		537		571
Total	$	351	$	467	$	514	$	546	$	577	$	613

Pension expense. This table shows the components of the pension expense recognized during each of the last three years. The amount for each year includes amortization of the prior service cost and net actuarial loss included in accumulated other comprehensive loss as of the beginning of the year.

	Pension Benefits
	2009			2010			2011
Service cost	$	13		$	10		$	16
Interest cost		30			32			33
Special termination benefits		1			—			1
Expected return on plan assets		(35	)		(34	)		(36	)
Amortization of:
Prior service cost		1			1			1
Net actuarial loss		6			4			18
Net expense	$	16		$	13		$	33

The prior service cost represents the cost of retroactive benefits granted in plan amendments and is amortized on a straight-line basis over the average remaining service period of the employees expected to receive the benefits. The net actuarial loss results from experience different from that assumed or from a change in actuarial assumptions (including the difference between actual and expected return on plan assets), and is amortized over at least that same period. The estimated amount of prior service cost and net actuarial loss that will be amortized from accumulated other comprehensive loss into pension expense in 2012 is $1 and $19, respectively.

Other postretirement benefit expense. This table shows the components of the postretirement medical and life insurance benefit expense that we recognized during each of the last three years.

	Medical and Life Insurance Benefits
	2009		2010		2011
Service cost	$	1	$	1	$	1
Interest cost		3		3		3
Net expense	$	4	$	4	$	4

Other comprehensive income. Changes in the funded status of our benefit plans that are not recognized in net income (as pension and other postretirement benefit expense) are instead recognized in other comprehensive income. Other comprehensive income is also adjusted to reflect the amortization of the prior service cost and net actuarial gain or loss, which is a component of net pension and other postretirement benefit expense, from accumulated other comprehensive income (loss) to net income. This table shows the amounts recognized in other comprehensive income during each of the last three years:

	Pension									Medical and Life
	Benefits									Insurance Benefits
	2009			2010			2011			2009			2010		2011
Prior service cost	$	1		$	—		$	—		$	—		$	—	$	5
Actuarial loss (gain)		92			100			(18	)		(9	)		12		(10	)
Amortization reclassified to net income:
Prior service cost		(1	)		(1	)		(1	)		—			—		—
Net actuarial loss		(6	)		(4	)		(18	)		—			—		—
Net amount recognized in other comprehensive income	$	86		$	95		$	(37	)	$	(9	)	$	12	$	(5	)

Assumptions and sensitivity. We use various assumptions to determine the obligations and expense related to our pension and other postretirement benefit plans. The assumptions used in computing benefit plan obligations as of the end of the last two years were as follows:

	Pension						Medical and Life
	Benefits						Insurance Benefits
	2010			2011			2010			2011
Discount rate		5.91	%		5.67	%		5.78	%		5.59	%
Rate of salary increase		4.00	%		4.00	%		n/a			n/a

Here are the assumptions we used in computing benefit plan expense during each of the last three years:

	Pension									Medical and Life
	Benefits									Insurance Benefits
	2009			2010			2011			2009			2010			2011
Discount rate		6.87	%		7.94	%		5.91	%		6.87	%		7.80	%		5.78	%
Rate of salary increase		4.00	%		4.00	%		4.00	%		n/a			n/a			n/a
Expected return on plan assets		8.75	%		8.50	%		8.50	%		n/a			n/a			n/a

The discount rate represents the interest rate used to discount the cash-flow stream of benefit payments to a net present value as of the current date. A lower assumed discount rate increases the present value of the benefit obligation. We determined the discount rate using a yield curve based on the interest rates of high-quality debt securities with maturities corresponding to the expected timing of our benefit payments.

The assumed rate of salary increase reflects the expected average annual increase in salaries as a result of inflation, merit increases, and promotions over the service period of the plan participants. A lower assumed rate decreases the present value of the benefit obligation.

The expected return on plan assets represents the long-term rate of return that we assume will be earned over the life of the pension assets. The assumption reflects expected capital market returns for each asset class, which are based on historical returns, adjusted for the expected effects of diversification and active management (net of fees).

The assumed health care cost trend rates as of the end of the last two years were as follows:

	Medical and Life
	Insurance Benefits
	2010			2011
Health care cost trend rate assumed for next year:
Present rate before age 65		8.0	%		7.5	%
Present rate age 65 and after		8.0	%		7.5	%

We project health care cost trend rates to decline gradually to 5.0% by 2016 and to remain level after that. Assumed health care cost trend rates have a significant effect on the amounts reported for postretirement medical plans. A 1% increase/decrease in assumed health care cost trend rates would have increased/decreased the accumulated postretirement benefit obligation as of April 30, 2011, by $6 and the aggregate service and interest costs for 2011 by $1.

Savings plans. We also sponsor various defined contribution benefit plans that in total cover substantially all U.S. employees. Employees can make voluntary contributions in accordance with their respective plans, which include a 401(k) tax deferral option. We match a percentage of each employee’s contributions in accordance with the plans’ terms. We expensed $10, $8, and $9 for matching contributions during 2009, 2010, and 2011, respectively.

International plans. The information presented above for defined benefit plans and defined contribution benefit plans reflects amounts for U.S. plans only. Information about similar international plans is not presented due to immateriality.

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Stock-Based Compensation

12 Months Ended

Apr. 30, 2011

Stock-based Compensation [Abstract]

STOCK-BASED COMPENSATION

12. STOCK-BASED COMPENSATION

Under our 2004 Omnibus Compensation Plan, we can grant stock-based incentive awards for a total of 7,433,000 shares of common stock to eligible employees until July 22, 2014. As of April 30, 2011, awards for 4,265,000 shares remain available for issuance under the Plan. Shares delivered to employees are limited by the Plan to shares that we purchase for this purpose. No new shares may be issued.

The following table presents information about stock options and SSARs granted under the Plan as of April 30, 2011, and for the year then ended:

						Weighted
	Number of			Weighted		Average
	Underlying			Average		Remaining
	Shares			Exercise Price		Contractual		Aggregate
	(in thousands)			per Award		Term (years)		Intrinsic Value
Outstanding at May 1, 2010		4,051		$	41.31
Granted		415			61.24
Exercised		(738	)		30.26
Forfeited or expired		(22	)		49.52
Outstanding at April 30, 2011		3,706		$	45.69		5.0	$	97
Exercisable at April 30, 2011		2,470		$	41.77		3.6	$	74

The total intrinsic value of options and SSARs exercised during 2009, 2010, and 2011 was $17, $18, and $25, respectively.

We grant stock options and SSARs at an exercise price of not less than the fair value of the underlying stock on the grant date. Stock options and SSARs granted under the Plan become exercisable after three years from the first day of the fiscal year of grant and expire seven years after that date. The grant-date fair values of these awards granted during 2009, 2010, and 2011 were $11.24, $9.42, and $12.66 per award, respectively. Fair values were estimated using the Black-Scholes pricing model with the following assumptions:

	2009			2010			2011
Risk-free interest rate		3.5	%		3.0	%		2.1	%
Expected volatility		18.1	%		22.6	%		23.7	%
Expected dividend yield		1.8	%		1.9	%		1.9	%
Expected life (years)		6			6			6

We also grant restricted stock units (RSUs), deferred stock units (DSUs), and shares of restricted stock under the Plan. Approximately 82,000 shares underlying these awards, with a weighted-average remaining restriction period of 1.8 years, were outstanding at April 30, 2011. The following table summarizes the changes in outstanding RSUs, DSUs, and restricted stock during 2011:

	Number of
	Underlying Shares			Weighted Average
	(in thousands)			Fair Value at Grant Date
Outstanding at May 1, 2010		176		$	50.59
Granted		28			61.14
Vested		(122	)		51.21
Outstanding at April 30, 2011		82		$	53.28

The total fair value of RSUs, DSUs, and restricted stock vested during 2009, 2010, and 2011 was $3, $2, and $9, respectively.

As previously announced, we paid a special cash dividend of $1.00 per share on Class A and Class B common stock in December 2010. According to the terms of the Plan, we adjusted the exercise price and number of stock options, SSARs and RSUs outstanding on the ex-distribution date in order to avoid the reduction in value of those awards that would otherwise have occurred as a result of the special dividend. The number of awards, exercise price per award, and grant-date fair value per award presented above reflect these adjustments.

The accompanying consolidated statements of operations reflect compensation expense related to stock-based incentive awards on a pre-tax basis of $7 in 2009, $8 in 2010, and $9 in 2011, partially offset by deferred income tax benefits of $3 in 2009, $3 in 2010, and $4 in 2011. As of April 30, 2011, there was $9 of total unrecognized compensation cost related to non-vested stock-based compensation. That cost is expected to be recognized over a weighted-average period of 2.0 years.

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Restructuring Costs

12 Months Ended

Apr. 30, 2011

Restructuring Costs [Abstract]

RESTRUCTURING COSTS

13. RESTRUCTURING COSTS

In April 2009, we accrued $12 in costs related to our decision to reduce our workforce through involuntary employment termination and voluntary early retirement. That amount, which is reflected in selling, general, and administrative expenses, consisted of severance and other special termination benefits. We incurred no material additional expenses as a result of this reduction in workforce, which was completed in fiscal 2009, and we paid substantially all of the accrued amount during fiscal 2010.

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Other Income and Expense

12 Months Ended

Apr. 30, 2011

Other Income and Expense [Abstract]

OTHER INCOME AND EXPENSE

14. OTHER INCOME AND EXPENSE

In fiscal 2009, we recognized a gain of $20 on the sale of the Bolla and Fontana Candida trademarks. In fiscal 2010, we recorded an impairment charge of $12 related to the Don Eduardo trademark (Note 3). These amounts are reflected as other (income) expense in the accompanying consolidated statements of operations.

In March 2011, we agreed to sell Fetzer Vineyards to Chilean wine producer Viña Concha y Toro. This agreement followed the December 2010 announcement that we were exploring strategic alternatives for our Hopland, California-based wine assets, including a possible sale.

We completed this transaction on April 15, 2011, at a sales price (subject to a post-closing working capital adjustment) of $234 in cash. As a result, we recognized a gain on sale (net of transaction costs and income taxes) of $38, which is reflected in the accompanying consolidated statement of operations as follows:

Net sales	$	(3	)
Selling, general, and administrative expenses		(6	)
Other income		62
Income taxes		(15	)
Net gain	$	38

The sale included the Fetzer winery, bottling facility, and vineyards, as well as the Fetzer brand and other Hopland, California-based wines, including Bonterra, Little Black Dress, Jekel, Five Rivers, Bel Arbor, Coldwater Creek, and Sanctuary. Also included in the sale was a facility in Paso Robles, California.

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Income Taxes

12 Months Ended

Apr. 30, 2011

Income Taxes [Abstract]

INCOME TAXES

15. INCOME TAXES

We incur income taxes on the earnings of our U.S. and foreign operations. The following table, based on the locations of the taxable entities from which sales were derived (rather than the location of customers), presents the U.S. and foreign components of our income before income taxes:

	2009		2010		2011
United States	$	533	$	576	$	696
Foreign		97		106		133
	$	630	$	682	$	829

The income shown above was determined according to financial accounting standards. Because those standards sometimes differ from the tax rules used to calculate taxable income, there are differences between: (a) the amount of taxable income and pretax financial income for a year; and (b) the tax bases of assets or liabilities and their amounts as recorded in our financial statements. As a result, we recognize a current tax liability for the estimated income tax payable on the current tax return, and deferred tax liabilities (income tax payable on income that will be recognized on future tax returns) and deferred tax assets (income tax refunds from deductions that will be recognized on future tax returns) for the estimated effects of the differences mentioned above.

Deferred tax assets and liabilities as of the end of each of the last two years were as follows:

April 30,	2010			2011
Deferred tax assets:
Postretirement and other benefits	$	125		$	94
Accrued liabilities and other		26			22
Loss and credit carryforwards		56			50
Valuation allowance		(40	)		(23	)
Total deferred tax assets, net		167			143
Deferred tax liabilities:
Trademarks and brand names		(168	)		(195	)
Property, plant, and equipment		(37	)		(46	)
Total deferred tax liabilities, net		(205	)		(241	)
Net deferred tax liability	$	(38	)	$	(98	)

The $23 valuation allowance at April 30, 2011 relates primarily to a $13 non-trading loss carryforward generated by Brown-Forman Beverages Europe during fiscal 2009 in the U.K. Although the non-trading losses can be carried forward indefinitely, we know of no significant transactions that will let us use them. The remaining valuation allowance relates primarily to other foreign net operating losses, some of which can be carried forward indefinitely, and others that expire between fiscal 2018 and 2020. We are currently unaware of any significant transactions that will allow us to utilize these losses. During fiscal 2011, we used all of our U.S. capital loss carryforward to offset gains on the sales of Fetzer and Paso Robles. As a result, we reversed the $20 valuation allowance that was recorded at April 30, 2010 related to this item.

As of April 30, 2011, the gross amounts of loss and credit carryforwards include a U.K. non-trading loss of $47 (no expiration); other foreign net operating losses of $56 ($25 of which expire in varying amounts between 2014 and 2021 and $31 of which do not expire); and foreign credit carryforwards of $8 (expiring between fiscal 2012 and 2017).

Deferred tax liabilities were not provided on undistributed earnings of certain foreign subsidiaries ($365 and $390 at April 30, 2010 and 2011, respectively) because we expect these undistributed earnings to be reinvested indefinitely overseas. If these amounts were not considered permanently reinvested, additional deferred tax liabilities of approximately $73 and $76 would have been provided as of April 30, 2010 and 2011, respectively.

Total income tax expense for a year includes the tax associated with the current tax return (“current tax expense”) and the change in the net deferred tax asset or liability (“deferred tax expense”). Our total income tax expense for each of the last three years was as follows:

	2009			2010			2011
Current:
U.S. federal	$	142		$	175		$	171
Foreign		26			28			41
State and local		15			19			18
		183			222			230
Deferred:
U.S. federal	$	14		$	16		$	46
Foreign		(2	)		(5	)		(1	)
State and local		—			—			(18	)
		12			11			27
	$	195		$	233		$	257

Our consolidated effective tax rate usually differs from current statutory rates due to the recognition of amounts for events or transactions that have no tax consequences. The following table reconciles our effective tax rate to the federal statutory tax rate in the United States:

	Percent of Income Before Taxes
	2009			2010			2011
U.S. federal statutory rate		35.0	%		35.0	%		35.0	%
State taxes, net of U.S. federal tax benefit		1.8			1.8			1.1
Income taxed at other than U.S. federal statutory rate		(1.3	)		(1.0	)		(0.4	)
Tax benefit from U.S. manufacturing		(1.7	)		(1.7	)		(2.2	)
Capital loss benefit		(1.2	)		—			(2.7	)
Nondeductible goodwill on Fetzer sale		—			—			2.1
Other, net		(1.5	)		—			(1.9	)
Effective rate		31.1	%		34.1	%		31.0	%

During the fourth quarter of fiscal 2011, we recorded an adjustment to reverse $8 of income tax expense that was incorrectly recognized in prior periods. We believe the impact of this error and the cumulative out of period adjustment to correct the error is insignificant to our consolidated financial statements for the current period and any prior periods.

At April 30, 2011, we had $40 of gross unrecognized tax benefits, $22 of which would reduce our effective income tax rate if recognized. A reconciliation of the beginning and ending unrecognized tax benefits follows:

	2009			2010			2011
Unrecognized tax benefits at beginning of year	$	35		$	26		$	35
Additions for tax positions provided in prior periods		1			—			1
Additions for tax positions provided in current period		4			13			14
Decreases for tax positions provided in prior years		—			—			(4	)
Settlements of tax positions in the current period		(2	)		(3	)		(5	)
Lapse of statutes of limitations		(12	)		(1	)		(1	)
Unrecognized tax benefits at end of year	$	26		$	35		$	40

We record interest and penalties related to unrecognized tax benefits as a component of our income tax provision. Total gross interest and penalties of $6, $8 and $11 were accrued as of April 30, 2009, 2010 and 2011, respectively. The impact of interest and penalties on our effective tax rates for 2009, 2010 and 2011 was not material.

We file income tax returns in the United States, including several state and local jurisdictions, as well as in several other countries in which we conduct business. The major jurisdictions and their earliest fiscal years that are currently open for tax examinations are 1998 in the United States, 2007 in Australia, Ireland, and Italy, 2005 in Poland and Finland, 2003 in the U.K. and 2002 in Mexico. Audits of our fiscal 2006 and 2007 U.S. federal tax returns were completed during fiscal 2010. In addition, audits of our fiscal 2008, 2009, and 2010 U.S. federal tax returns commenced during fiscal 2011. Moreover, the Internal Revenue Service has accepted our application to participate in its Compliance Assurance Program for our fiscal 2012 tax year.

We believe there will be no material change in our gross unrecognized tax benefits in the next twelve months.

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Segment Information

12 Months Ended

Apr. 30, 2011

Segment Information [Abstract]

SEGMENT INFORMATION

16. SEGMENT INFORMATION

The following table presents net sales by product category:

	2009		2010		2011
Net sales:
Spirits	$	2,832	$	2,916	$	3,102
Wine		360		310		302
	$	3,192	$	3,226	$	3,404

	2009		2010		2011
Net sales:
United States	$	1,542	$	1,529	$	1,525
Europe		892		879		909
Other		758		818		970
	$	3,192	$	3,226	$	3,404

Net sales are attributed to countries based on where customers are located.

The net book value of property, plant, and equipment located in Mexico was $62 and $65 as of April 30, 2010 and 2011, respectively. Other long-lived assets located outside the United States are not significant.

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Schedule II - Valuation and Qualifying Accounts

12 Months Ended

Apr. 30, 2011

Valuation and Qualifying Accounts [Abstract]

VALUATION AND QUALIFYING ACCOUNTS

BROWN-FORMAN CORPORATION AND SUBSIDIARIES
SCHEDULE II — VALUATION AND QUALIFYING ACCOUNTS
For the Years Ended April 30, 2009, 2010, and 2011
(Expressed in millions)

Col. A	Col. B			Col. C(1)		Col. C(2)			Col. D			Col. E
				Additions		Additions
	Balance at			Charged to		Charged to						Balance
	Beginning			Costs and		Other						At End
Description	of Period			Expenses		Accounts			Deductions			of Period
2009
Allowance for Doubtful Accounts	$	19			—		—		$	4	(1)	$	15
Accrued Restructuring Costs		—		$	12		—			—		$	12
2010
Allowance for Doubtful Accounts	$	15			—	$	1	(2)		—		$	16
Accrued Restructuring Costs	$	12			—		—		$	10	(3)	$	2	(4)
2011
Allowance for Doubtful Accounts	$	16		$	1	$	1	(2)		—		$	18
Accrued Restructuring Costs	$	2	(4)		—		—		$	2	(5)		—

(1)	Doubtful accounts written off, net of recoveries.
(2)	Foreign currency translation adjustment charged to accumulated other comprehensive income.
(3)	Employee severance and other special termination benefit payments.
(4)	Consists of estimated present value of special termination benefits to be made to former employees over their remaining lives.
(5)	Special termination benefit payments and amounts reclassified to accrued postretirement benefits.

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Accounting Policies (Policies)

12 Months Ended

Apr. 30, 2011

Accounting Policies [Abstract]

Principles of consolidation

Principles of consolidation. Our consolidated financial statements include the accounts of all wholly owned and majority-owned subsidiaries. We use the equity method to account for investments in affiliates over which we can exercise significant influence (but not control). We carry all other investments in affiliates at cost. We eliminate all intercompany transactions.

Cash equivalents

Cash equivalents. Cash equivalents include bank demand deposits and all highly liquid investments with original maturities of three months or less.

Allowance for doubtful accounts

Allowance for doubtful accounts. We evaluate the collectability of accounts receivable based on a combination of factors. When we are aware of circumstances that may impair a specific customer’s ability to meet its financial obligations, we record a specific allowance to reduce the net recognized receivable to the amount we believe will be collected. We write off the uncollectible amount against the allowance when we have exhausted our collection efforts.

Inventories

Inventories. We state inventories at the lower of cost or market, with approximately 63% of consolidated inventories being valued using the last-in, first-out (LIFO) method. We value the remainder primarily using the first-in, first-out (FIFO) method. FIFO cost approximates current replacement cost. If we had used the FIFO method for all inventories, they would have been $219 and $204 higher than reported at April 30, 2010 and 2011, respectively.

Whiskey must be barrel-aged for several years, so we bottle and sell only a portion of our whiskey inventory each year. Following industry practice, we classify all barreled whiskey as a current asset. We include warehousing, insurance, ad valorem taxes, and other carrying charges applicable to barreled whiskey in inventory costs.

We classify bulk wine and agave inventories as work in process.

During 2009, we recorded a $22 provision for inventory losses (included in cost of sales) resulting from abnormally high levels of mortality and disease in some of our agave fields.

Property, plant, and equipment

Property, plant, and equipment. We state property, plant, and equipment at cost less accumulated depreciation. We calculate depreciation on a straight-line basis using our estimates of useful life, which are 20—40 years for buildings and improvements; 3—10 years for machinery, equipment, vehicles, furniture, and fixtures; and 3—7 years for capitalized software.

We assess our property, plant, and equipment for impairment whenever events or changes in circumstances indicate that the carrying value of those assets may not be recoverable. When we do not expect to recover the carrying value of an asset (or asset group) through undiscounted future cash flows, we write it down to its estimated fair value. We determine fair value using discounted estimated future cash flows, considering market values for similar assets when available.

Upon disposal or retirement of property, plant, and equipment, we remove its cost and accumulated depreciation from our balance sheet. Any gain or loss is reflected in operating income. We expense the cost of repairing and maintaining our property, plant, and equipment as costs are incurred.

Goodwill and other intangible assets

Goodwill and other intangible assets. We have obtained most of our brands by acquiring other companies. Upon acquisition, the purchase price is first allocated to identifiable assets and liabilities, including intangible brand names and trademarks (“brand names”), based on estimated fair value, with any remaining purchase price recorded as goodwill. We do not amortize goodwill or intangible assets with indefinite lives. We consider all of our brand names to have indefinite lives.

We assess our goodwill and other indefinite-lived intangible assets for impairment at least annually. If the fair value of an asset is less than its book value, we write it down to its estimated fair value. Goodwill is evaluated for impairment if the book value of its reporting unit exceeds its estimated fair value. We estimate the fair value of a reporting unit using discounted estimated future cash flows. We typically estimate the fair value of a brand name using the “relief from royalty” method. We also consider market values for similar assets when available. Considerable management judgment is necessary to estimate fair value, including the selection of assumptions about future cash flows, discount rates, and royalty rates.

Foreign currency translation

Foreign currency translation. The U.S. dollar is the functional currency for most of our consolidated operations. For those operations, we report all gains and losses from foreign currency transactions in current income. The local currency is the functional currency for some foreign operations. For those investments, we report cumulative translation effects as a component of accumulated other comprehensive income (loss), a component of stockholders’ equity.

Revenue recognition

Revenue recognition. We recognize revenue when title and risk of loss pass to the customer, typically when the product is shipped. Some sales contracts contain customer acceptance provisions that grant a right of return on the basis of either subjective or objective criteria. We record revenue net of the estimated cost of sales returns and allowances.

Sales discounts

Sales discounts. Sales discounts, which are recorded as a reduction of net sales, totaled $328, $398, and $461 for 2009, 2010, and 2011, respectively.

Excise taxes

Excise taxes. Our sales are subject to excise taxes, which we collect from our customers and remit to governmental authorities. We present these taxes on a gross basis (included in net sales and costs before gross profit) in the consolidated statement of operations.

Cost of sales

Cost of sales. Cost of sales includes the costs of receiving, producing, inspecting, warehousing, insuring, and shipping goods sold during the period.

Shipping and handling fees and costs

Shipping and handling fees and costs. We report the amounts we bill to our customers for shipping and handling as net sales, and we report the costs we incur for shipping and handling as cost of sales.

Advertising costs

Advertising costs. We expense the costs of advertising during the year when the advertisements first take place.

Selling, general, and administrative expenses

Selling, general, and administrative expenses. Selling, general, and administrative expenses include the costs associated with our sales force, administrative staff and facilities, and other expenses related to our non-manufacturing functions.

Income Taxes

Income taxes. We base our annual provision for income taxes on the pre-tax income reflected in our consolidated statement of operations. We establish deferred tax liabilities or assets for temporary differences between financial and tax reporting bases and subsequently adjust them to reflect changes in tax rates expected to be in effect when the temporary differences reverse. We record a valuation allowance as necessary to reduce a deferred tax to the amount that we believe is more likely than not to be realized. We do not provide deferred income taxes on undistributed earnings of foreign subsidiaries that we expect to permanently reinvest.

We assess our uncertain income tax positions using a two-step process. First, we evaluate whether the tax position will more likely than not, based on its technical merits, be sustained upon examination, including resolution of any related appeals or litigation. For a tax position that does not meet this first criterion, we recognize no tax benefit. For a tax position that does meet the first criterion, we recognize a tax benefit in an amount equal to the largest amount of benefit that we believe has more than a 50% likelihood of being realized upon ultimate resolution.

Earnings per share

Earnings per share. We calculate basic earnings per share by dividing net income available to common stockholders by the weighted average number of all unrestricted common shares outstanding during the period. Diluted earnings per share further includes the dilutive effect of stock options, stock-settled appreciation rights (SSARs), restricted stock units (RSUs), and deferred stock units (DSUs). We calculate that dilutive effect using the “treasury stock method” (as defined by GAAP).

We have granted restricted shares of common stock to certain employees as part of their compensation. These restricted shares, which have varying vesting periods, contain non-forfeitable rights to dividends declared on common stock. As a result, the unvested restricted shares are considered participating securities in the calculation of earnings per share in accordance with a new accounting standard that we adopted retrospectively effective May 1, 2009. The adoption decreased previously reported basic earnings per share for 2009 from $2.89 to $2.88.

The following table presents information concerning basic and diluted earnings per share:

	2009			2010			2011
Basic and diluted net income	$	435		$	449		$	572
Income allocated to participating securities (restricted shares)		(1	)		(1	)		(1	)
Net income available to common stockholders	$	434		$	448		$	571
Share data (in thousands):
Basic average common shares outstanding		150,452			147,834			145,603
Dilutive effect of stock options, SSARs, RSUs, and DSUs		927			741			910
Diluted average common shares outstanding		151,379			148,575			146,513
Basic earnings per share	$	2.88		$	3.03		$	3.92
Diluted earnings per share	$	2.87		$	3.02		$	3.90

SSARs for approximately 1,899,000 common shares, 824,000 common shares, and 350,000 common shares were excluded from the calculation of diluted earnings per share for 2009, 2010, and 2011, respectively, because they were not dilutive for those periods under the treasury stock method.

Stock distribution

Stock distribution. In September 2008, our Board of Directors authorized a stock split, effected as a stock dividend, of one share of Class B common stock for every four shares of either Class A or Class B common stock held by stockholders of record as of the close of business on October 6, 2008, with fractional shares paid in cash. The distribution took place on October 27, 2008. As a result of the stock distribution, we reclassified approximately $5 from our retained earnings to our common stock account. The $5 represents the $0.15 par value per share of the shares issued in the stock distribution.

Stock-based compensation

Stock-based compensation. Our stock-based compensation plan requires that we purchase shares to satisfy stock-based compensation requirements, thereby avoiding future dilution of earnings that would occur from issuing additional shares. We acquire treasury shares from time to time in anticipation of these requirements. We intend to hold enough treasury stock so that the number of diluted shares never exceeds the original number of shares outstanding at the inception of the stock-based compensation plan (as adjusted for any share issuances unrelated to the plan). The extent to which the number of diluted shares exceeds the number of basic shares is determined by how much our stock price has appreciated since the stock-based compensation was awarded, not by how many treasury shares we have acquired.

Estimates

Estimates. To prepare financial statements that conform with generally accepted accounting principles, our management must make informed estimates that affect how we report revenues, expenses, assets, and liabilities, including contingent assets and liabilities. Actual results could (and probably will) differ from these estimates.

Recent accounting pronouncements

Recent accounting pronouncements. During fiscal 2011, we adopted new guidance for disclosures about allowances for doubtful accounts and about fair value measurements. Adopting this new accounting guidance had no material impact on our financial statements.

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Accounting Policies (Tables)

12 Months Ended

Apr. 30, 2011

Accounting Policies [Abstract]

Basic and Diluted Earnings Per Share

	2009			2010			2011
Basic and diluted net income	$	435		$	449		$	572
Income allocated to participating securities (restricted shares)		(1	)		(1	)		(1	)
Net income available to common stockholders	$	434		$	448		$	571
Share data (in thousands):
Basic average common shares outstanding		150,452			147,834			145,603
Dilutive effect of stock options, SSARs, RSUs, and DSUs		927			741			910
Diluted average common shares outstanding		151,379			148,575			146,513
Basic earnings per share	$	2.88		$	3.03		$	3.92
Diluted earnings per share	$	2.87		$	3.02		$	3.90

SSARs for approximately 1,899,000 common shares, 824,000 common shares, and 350,000 common shares were excluded from the calculation of diluted earnings per share for 2009, 2010, and 2011, respectively, because they were not dilutive for those periods under the treasury stock method.

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Balance Sheet Information (Tables)

12 Months Ended

Apr. 30, 2011

Balance Sheet Information [Abstract]

Supplemental information on year-end balance sheets

April 30,	2010		2011
Other current assets:
Prepaid taxes	$	99	$	129
Other		85		89
	$	184	$	218
Property, plant, and equipment:
Land	$	89	$	69
Buildings		349		317
Equipment		491		446
Construction in process		15		11
		944		843
Less accumulated depreciation		476		450
	$	468	$	393
Accounts payable and accrued expenses:
Accounts payable, trade	$	97	$	126
Accrued expenses:
Advertising		55		72
Compensation and commissions		90		81
Excise and other non-income taxes		43		54
Self-insurance claims		12		11
Postretirement benefits		6		6
Interest		4		7
Other		35		55
		245		286
	$	342	$	412

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Consolidated Balance Sheets (USD $) In Millions	Apr. 30, 2011	Apr. 30, 2010
Assets
Cash and cash equivalents	$ 567	$ 232
Accounts receivable, less allowance for doubtful accounts of $16 in 2010 and $18 in 2011	496	418
Inventories:
Barreled whiskey	330	299
Finished goods	150	142
Work in process	120	157
Raw materials and supplies	47	53
Total inventories	647	651
Current deferred tax assets	48	42
Other current assets	218.0	184.0
Total current assets	1,976	1,527
Property, plant and equipment, net	393	468
Goodwill	625	666
Other intangible assets	670	669
Deferred tax assets	12	11
Other assets	36	42
Total assets	3,712	3,383
Liabilities
Accounts payable and accrued expenses	412	342
Accrued income taxes	32	4
Current deferred tax liabilities	8	9
Short-term Borrowings	0	188
Current portion of long-term debt	255	3
Total current liabilities	707	546
Long-term debt, less unamortized discount of $1 in 2010 and $2 in 2011	504	508
Deferred tax liabilities	150	82
Accrued pension and other postretirement benefits	203	283
Other liabilities	88	69
Total liabilities	1,652	1,488
Commitments and contingencies
Common stock:
Additional paid-in capital	55	59
Retained earnings	2,710	2,464
Accumulated other comprehensive (loss) income, net of tax:
Pension and other postretirement benefits adjustment	(165)	(190)
Cumulative translation adjustment	48	11
Unrealized gain (loss) on cash flow hedge contracts	(14)	3
Treasury stock, at cost (9,364,000 and 11,337,000 shares in 2010 and 2011, respectively)	(598)	(476)
Total stockholders' equity	2,060	1,895
Total liabilities and stockholders' equity	3,712	3,383
Common Stock, Class A, voting [Member]
Common stock:
Common stock	9	9
Accumulated other comprehensive (loss) income, net of tax:
Total stockholders' equity		9
Common Stock, Class B, nonvoting [Member]
Common stock:
Common stock	15	15
Accumulated other comprehensive (loss) income, net of tax:
Total stockholders' equity	$ 15	$ 15

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Goodwill and Other Intangible Assets (Tables)

12 Months Ended

Apr. 30, 2011

Goodwill and Other Intangible Assets [Abstract]

Amount recorded as goodwill

Balance as of April 30, 2009	$	675
Foreign currency translation adjustment and other		(9	)
Balance as of April 30, 2010		666
Disposal of Hopland-based wine business (Note 14)		(49	)
Foreign currency translation adjustment		8
Balance as of April 30, 2011	$	625

Other Intangible Assets

	Gross Carrying				Accumulated
	Amount				Amortization
	2010		2011		2010			2011
Finite-lived intangible assets:
Distribution rights	$	25	$	25	$	(17	)	$	(22	)
Indefinite-lived intangible assets:
Trademarks and brand names		661		667		—			—

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Debt (Tables)

12 Months Ended

Apr. 30, 2011

Debt [Abstract]

Long-term debt

April 30,	2010		2011
5.2% notes, due in fiscal 2012	$	250	$	252
5.0% notes, due in fiscal 2014		250		250
2.5% notes, due in fiscal 2016		—		249
Other		11		8
		511		759
Less current portion		3		255
	$	508	$	504

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Fair Value Measurements (Tables)

12 Months Ended

Apr. 30, 2011

Fair Value Measurements [Abstract]

Summary of assets and liabilities measured at fair value on a recurring basis

	Level 1		Level 2		Level 3		Total
April 30, 2010:
Assets:
Currency derivatives	$	—	$	6	$	—	$	6
Liabilities:
Currency derivatives		—		6		—		6
April 30, 2011:
Assets:
Commodity derivatives		5		—		—		5
Interest rate swaps		—		3		—		3
Liabilities:
Currency derivatives		—		25		—		25

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Fair Value of Financial Instruments (Tables)

12 Months Ended

Apr. 30, 2011

Fair Value of Financial Instruments [Abstract]

Comparison of the fair values and carrying amounts of financial instrument

April 30,	2010				2011
	Carrying		Fair		Carrying		Fair
	Amount		Value		Amount		Value
Assets:
Cash and cash equivalents	$	232	$	232	$	567	$	567
Commodity derivatives		—		—		5		5
Currency derivatives		6		6		—		—
Interest rate swaps		—		—		3		3
Liabilities:
Currency derivatives		6		6		25		25
Short-term borrowings		188		188		—		—
Current portion of long-term debt		3		3		255		265
Long-term debt		508		547		504		531

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Derivative Financial Instruments (Tables)

12 Months Ended

Apr. 30, 2011

Derivative Financial Instruments [Abstract]

Fair values of derivative instruments

		Fair value of		Fair value of
		derivatives in a		derivatives in a
	Classification	gain position		loss position
April 30, 2010:
Designated as cash flow hedges:
Currency derivatives	Other current assets	$	7	$	(2	)
Currency derivatives	Other assets		2		(1	)
Currency derivatives	Accrued expenses		1		(6	)
Currency derivatives	Other liabilities		—		(1	)
Designated as net investment hedges:
Currency derivatives	Other current assets		—		(3	)
Not designated as hedges:
Currency derivatives	Other current assets		3		—
April 30, 2011:
Designated as cash flow hedges:
Currency derivatives	Accrued expenses		—		(22	)
Currency derivatives	Other liabilities		—		(6	)
Designated as fair value hedges:
Interest rate swaps	Other current assets		2		—
Interest rate swaps	Other assets		1		—
Not designated as hedges:
Commodity derivatives	Other current assets		5		—
Currency derivatives	Accrued expenses		3		—

Fair values of derivative instruments affecting statements of operations

	Classification	2010			2011
Currency derivatives designated as cash flow hedges:
Net gain (loss) recognized in AOCI	n/a	$	(19	)	$	(27	)
Net gain (loss) reclassified from AOCI into income	Net sales		(16	)		—
Interest rate swaps designated as fair value hedges:
Net gain (loss) recognized in income	Interest expense		—			3
Net gain (loss) recognized in income*	Other income		—			2

*  The effect on the hedged item was an equal but offsetting amount for the periods presented.

Currency derivatives designated as net investment hedges:
Net gain (loss) recognized in AOCI	n/a	(8	)	(1	)
Derivatives not designated as hedging instruments:
Currency derivatives — net gain (loss) recognized in income	Net sales	(8	)	(10	)
Currency derivatives — net gain (loss) recognized in income	Other income	1		(2	)
Commodity derivatives — net gain (loss) recognized in income	Cost of sales	(1	)	10

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Pension and Other Postretirement Benefits (Tables)

12 Months Ended

Apr. 30, 2011

Pension and Other Postretirement Benefits [Abstract]

Annual pension and other postretirement benefit expenses as per the changed measurement date

	Pension			Medical and Life			Total
	Benefits			Insurance Benefits			Benefits
Retained earnings	$	(2	)	$	(1	)	$	(3	)
Accumulated other comprehensive income		8			1			9
Total	$	6		$	—		$	6

Change in present value of pension and other postretirement benefit obligation

	Pension						Medical and Life
	Benefits						Insurance Benefits
	2010			2011			2010			2011
Obligation at beginning of year	$	415		$	577		$	44		$	58
Service cost		10			16			1			1
Interest cost		32			33			3			3
Net actuarial loss (gain)		143			10			12			(10	)
Plan amendments		—			—			—			6
Retiree contributions		—			—			2			2
Benefits paid		(23	)		(24	)		(4	)		(4	)
Special termination benefits		—			1			—			—
Obligation at end of year	$	577		$	613		$	58		$	56

Expected benefit payments over the next 10 years

	Pension	Medical and Life
	Benefits	Insurance Benefits
2012	$25	$3
2013	26	3
2014	28	3
2015	29	3
2016	30	3
2017—2021	179	18

Fair value of pension plan assets by category, as well as the actual and target allocations

									Allocation by Asset Class
	Level 1		Level 2		Level 3		Total		Actual			Target
April 30, 2010:
Commingled trust funds(a):
Equity funds	$	—	$	176	$	—	$	176		50	%		47	%
Fixed income funds		—		117		—		117		33	%		30	%
Real estate funds		—		14		10		24		7	%		8	%
Total commingled trust funds		—		307		10		317		90	%		85	%
Hedge funds(b)		—		—		19		19		5	%		5	%
Private equity(c)		—		—		13		13		4	%		5	%
Cash and temporary investments(d)		2		—		—		2		1	%		—
Other		—		—		—		—		—			5	%
Total	$	2	$	307	$	42	$	351		100	%		100	%
April 30, 2011:
Commingled trust funds:
Equity funds	$	—	$	232	$	—	$	232		50	%		47	%
Fixed income funds		—		166		—		166		35	%		35	%
Real estate funds		—		18		9		27		6	%		8	%

Total commingled trust funds		—		416		9		425	91	%	90	%
Hedge funds		—		—		24		24	5	%	5	%
Private equity		—		—		16		16	3	%	5	%
Cash and temporary investments		2		—		—		2	1	%	—
Total	$	2	$	416	$	49	$	467	100	%	100	%

(a)	Commingled trust fund valuations are based on the net asset value (NAV) of the funds as determined by the administrator of the fund and reviewed by us. NAV represents the underlying assets owned by the fund, minus liabilities and divided by the number of shares or units outstanding.
(b)	Hedge fund valuations are primarily based on the NAV of the funds as determined by the administrator of the fund and reviewed by us. During our review, we determine whether it is necessary to adjust the valuation for inherent liquidity and redemption issues that may exist within the fund’s underlying assets or fund unit values.
(c)	As of April 30, 2010 and 2011, consists only of limited partnership interests, which are valued at the percentage ownership of total partnership equity as determined by the general partner. These valuations require significant judgment due to the absence of quoted market prices, the inherent lack of liquidity, and the long-term nature of these investments.
(d)	Cash and temporary investments consist of money market funds and are valued at their respective NAVs as determined by those funds each business day.

Change in fair value of Level 3 assets

	Real Estate			Hedge			Private
	Funds			Funds			Equity			Total
Balance as of May 1, 2009	$	15		$	4		$	13		$	32
Return on assets held at end of year		(4	)		1			—			(3	)
Return on assets sold during year		—			(1	)		(1	)		(2	)
Purchases and settlements		—			17			2			19
Sales and settlements		(1	)		(2	)		(1	)		(4	)
Balance as of April 30, 2010		10			19			13			42
Return on assets held at end of year		2			1			1			4
Return on assets sold during year		—			(1	)		—			(1	)
Purchases and settlements		—			6			4			10
Sales and settlements		(3	)		(1	)		(2	)		(6	)
Balance as of April 30, 2011	$	9		$	24		$	16		$	49

Change in fair value of the pension plan assets

	Pension						Medical and Life
	Benefits						Insurance Benefits
	2010			2011			2010			2011
Fair value at beginning of year	$	284		$	351		$	—		$	—
Actual return on plan assets		77			64			—			—
Retiree contributions		—			—			2			2
Company contributions		13			76			2			2
Benefits paid		(23	)		(24	)		(4	)		(4	)
Fair value at end of year	$	351		$	467		$	—		$	—

Funded status of plans

	Pension						Medical and Life
	Benefits						Insurance Benefits
	2010			2011			2010			2011
Assets	$	351		$	467		$	—		$	—
Obligations		(577	)		(613	)		(58	)		(56	)
Funded status	$	(226	)	$	(146	)	$	(58	)	$	(56	)

Funded status is recorded on the accompanying consolidated balance sheets

	Pension						Medical and Life
	Benefits						Insurance Benefits
	2010			2011			2010			2011
Other assets	$	5		$	7		$	—		$	—
Accounts payable and accrued expenses		(3	)		(3	)		(3	)		(3	)
Accrued postretirement benefits		(228	)		(150	)		(55	)		(53	)
Net liability	$	(226	)	$	(146	)	$	(58	)	$	(56	)
Accumulated other comprehensive loss:
Net actuarial loss (gain)	$	299		$	263		$	7		$	(3	)
Prior service cost		4			3			1			6
	$	303		$	266		$	8		$	3

Pension plans that have assets in excess of their accumulated benefit obligations with those whose assets are less than their obligations

					Accumulated				Projected
					Benefit				Benefit
	Plan Assets				Obligation				Obligation
	2010		2011		2010		2011		2010		2011
Plans with assets in excess of accumulated benefit obligation	$	45	$	50	$	38	$	41	$	40	$	42
Plans with accumulated benefit obligation in excess of assets		306		417		476		505		537		571
Total	$	351	$	467	$	514	$	546	$	577	$	613

Pension Expense

	Pension Benefits
	2009			2010			2011
Service cost	$	13		$	10		$	16
Interest cost		30			32			33
Special termination benefits		1			—			1
Expected return on plan assets		(35	)		(34	)		(36	)
Amortization of:
Prior service cost		1			1			1
Net actuarial loss		6			4			18
Net expense	$	16		$	13		$	33

Postretirement medical and life insurance benefit expense

	Medical and Life Insurance Benefits
	2009		2010		2011
Service cost	$	1	$	1	$	1
Interest cost		3		3		3
Net expense	$	4	$	4	$	4

Amounts recognized in other comprehensive income

	Pension									Medical and Life
	Benefits									Insurance Benefits
	2009			2010			2011			2009			2010		2011
Prior service cost	$	1		$	—		$	—		$	—		$	—	$	5
Actuarial loss (gain)		92			100			(18	)		(9	)		12		(10	)
Amortization reclassified to net income:
Prior service cost		(1	)		(1	)		(1	)		—			—		—
Net actuarial loss		(6	)		(4	)		(18	)		—			—		—
Net amount recognized in other comprehensive income	$	86		$	95		$	(37	)	$	(9	)	$	12	$	(5	)

Assumptions used in computing benefit plan obligations

	Pension						Medical and Life
	Benefits						Insurance Benefits
	2010			2011			2010			2011
Discount rate		5.91	%		5.67	%		5.78	%		5.59	%
Rate of salary increase		4.00	%		4.00	%		n/a			n/a

Assumptions used in computing benefit plan expense

	Pension									Medical and Life
	Benefits									Insurance Benefits
	2009			2010			2011			2009			2010			2011
Discount rate		6.87	%		7.94	%		5.91	%		6.87	%		7.80	%		5.78	%
Rate of salary increase		4.00	%		4.00	%		4.00	%		n/a			n/a			n/a
Expected return on plan assets		8.75	%		8.50	%		8.50	%		n/a			n/a			n/a

Assumed health care cost trend rates

	Medical and Life
	Insurance Benefits
	2010			2011
Health care cost trend rate assumed for next year:
Present rate before age 65		8.0	%		7.5	%
Present rate age 65 and after		8.0	%		7.5	%

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Stock-Based Compensation (Tables)

12 Months Ended

Apr. 30, 2011

Stock-based Compensation [Abstract]

Summary of stock options and SSARs granted under the plan

						Weighted
	Number of			Weighted		Average
	Underlying			Average		Remaining
	Shares			Exercise Price		Contractual		Aggregate
	(in thousands)			per Award		Term (years)		Intrinsic Value
Outstanding at May 1, 2010		4,051		$	41.31
Granted		415			61.24
Exercised		(738	)		30.26
Forfeited or expired		(22	)		49.52
Outstanding at April 30, 2011		3,706		$	45.69		5.0	$	97
Exercisable at April 30, 2011		2,470		$	41.77		3.6	$	74

Assumptions used for fair value estimation

	2009			2010			2011
Risk-free interest rate		3.5	%		3.0	%		2.1	%
Expected volatility		18.1	%		22.6	%		23.7	%
Expected dividend yield		1.8	%		1.9	%		1.9	%
Expected life (years)		6			6			6

Summary of changes in outstanding RSUs and restricted stock

	Number of
	Underlying Shares			Weighted Average
	(in thousands)			Fair Value at Grant Date
Outstanding at May 1, 2010		176		$	50.59
Granted		28			61.14
Vested		(122	)		51.21
Outstanding at April 30, 2011		82		$	53.28

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Other Income And Expense (Tables)

12 Months Ended

Apr. 30, 2011

Other Income and Expense [Abstract]

Consolidated statement of operations

Net sales	$	(3	)
Selling, general, and administrative expenses		(6	)
Other income		62
Income taxes		(15	)
Net gain	$	38

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Income Taxes (Tables)

12 Months Ended

Apr. 30, 2011

Income Taxes [Abstract]

Domestic and foreign income before income taxes

	2009		2010		2011
United States	$	533	$	576	$	696
Foreign		97		106		133
	$	630	$	682	$	829

Deferred tax assets and liabilities

April 30,	2010			2011
Deferred tax assets:
Postretirement and other benefits	$	125		$	94
Accrued liabilities and other		26			22
Loss and credit carryforwards		56			50
Valuation allowance		(40	)		(23	)
Total deferred tax assets, net		167			143
Deferred tax liabilities:
Trademarks and brand names		(168	)		(195	)
Property, plant, and equipment		(37	)		(46	)
Total deferred tax liabilities, net		(205	)		(241	)
Net deferred tax liability	$	(38	)	$	(98	)

Total income tax expense

	2009			2010			2011
Current:
U.S. federal	$	142		$	175		$	171
Foreign		26			28			41
State and local		15			19			18
		183			222			230
Deferred:
U.S. federal	$	14		$	16		$	46
Foreign		(2	)		(5	)		(1	)
State and local		—			—			(18	)
		12			11			27
	$	195		$	233		$	257

Reconciliation of effective tax rate to United States federal statutory tax rate

	Percent of Income Before Taxes
	2009			2010			2011
U.S. federal statutory rate		35.0	%		35.0	%		35.0	%
State taxes, net of U.S. federal tax benefit		1.8			1.8			1.1
Income taxed at other than U.S. federal statutory rate		(1.3	)		(1.0	)		(0.4	)
Tax benefit from U.S. manufacturing		(1.7	)		(1.7	)		(2.2	)
Capital loss benefit		(1.2	)		—			(2.7	)
Nondeductible goodwill on Fetzer sale		—			—			2.1
Other, net		(1.5	)		—			(1.9	)
Effective rate		31.1	%		34.1	%		31.0	%

Reconciliation of beginning and ending unrecognized tax benefits

	2009			2010			2011
Unrecognized tax benefits at beginning of year	$	35		$	26		$	35
Additions for tax positions provided in prior periods		1			—			1
Additions for tax positions provided in current period		4			13			14
Decreases for tax positions provided in prior years		—			—			(4	)
Settlements of tax positions in the current period		(2	)		(3	)		(5	)
Lapse of statutes of limitations		(12	)		(1	)		(1	)
Unrecognized tax benefits at end of year	$	26		$	35		$	40

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Segment Information (Tables)

12 Months Ended

Apr. 30, 2011

Segment Information [Abstract]

Net sales by product category

	2009		2010		2011
Net sales:
Spirits	$	2,832	$	2,916	$	3,102
Wine		360		310		302
	$	3,192	$	3,226	$	3,404

Net sales by geographic region

	2009		2010		2011
Net sales:
United States	$	1,542	$	1,529	$	1,525
Europe		892		879		909
Other		758		818		970
	$	3,192	$	3,226	$	3,404

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Consolidated Balance Sheets (Parenthetical) (USD $) In Millions, except Share data	Apr. 30, 2011	Apr. 30, 2010
Assets
Allowance for doubtful accounts	$ 18	$ 16
Liabilities
Unamortized discount	$ 2	$ 1
Common stock:
Treasury stock	11,337,000	9,364,000
Common Stock, Class A, voting [Member]
Common stock:
Common Stock, par value	$ 0.15	$ 0.15
Common Stock, shares authorized	57,000,000	57,000,000
Common Stock, shares issued	56,964,000	56,964,000
Common Stock, Class B, nonvoting [Member]
Common stock:
Common Stock, par value	$ 0.15	$ 0.15
Common Stock, shares authorized	100,000,000	100,000,000
Common Stock, shares issued	99,363,000	99,363,000

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Accounting Policies (Details) (USD $) In Millions, except Share data in Thousands, unless otherwise specified	12 Months Ended
	Apr. 30, 2011	Apr. 30, 2010	Apr. 30, 2009
Basic and Diluted Earnings Per Share
Basic and diluted net income	$ 572	$ 449	$ 435
Income allocated to participating securities (restricted shares)	(1)	(1)	(1)
Net income available to common stockholders	$ 571	$ 448	$ 434
Share data
Basic average common shares outstanding	145,603	147,834	150,452
Dilutive effect of stock options, SSARs and RSUs	910	741	927
Diluted average common shares outstanding	146,513	148,575	151,379
Basic earnings per share	$ 3.92	$ 3.03	$ 2.88
Diluted earnings per share	$ 3.90	$ 3.02	$ 2.87

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Accounting Policies (Details Textual) (USD $) In Millions, except Share data, unless otherwise specified	12 Months Ended
	Apr. 30, 2011	Apr. 30, 2010	Apr. 30, 2009	Oct. 27, 2008
Property, Plant and Equipment [Line Items]
Basic earnings per share	$ 3.92	$ 3.03	$ 2.88
Inventories valued using LIFO method	63.00%
FIFO method value of inventory in excess of reported	$ 204	$ 219
Provision for inventory losses			22
Sales discount, recorded as a reduction of net sales	461	398	328
Stock-settled appreciation rights for common Shares excluded from calculation of diluted Earning Per share	350,000	824,000	1,899,000
Stock Distribution	One share of Class B common stock for every four shares of either Class A or Class B common stock held by stockholders of record as of the close of business on October 6, 2008, with fractional shares paid in cash
Reclassification of retained earnings to common stock account				$ 5
Par value per share of the shares issued in the stock distribution equivalent to Reclassification of retained earnings				$ 0.15
Condition for recognizing tax benefit	we recognize a tax benefit in an amount equal to the largest amount of benefit that we believe has more than a 50% likelihood of being realized upon ultimate resolution
Building Improvements [Member]
Property, Plant and Equipment [Line Items]
Minimum Estimated Useful Life of Assets	20
Maximum Estimated Useful Life of Assets	40
Machinery And Equipment [Member]
Property, Plant and Equipment [Line Items]
Minimum Estimated Useful Life of Assets	3
Maximum Estimated Useful Life of Assets	10
Software [Member]
Property, Plant and Equipment [Line Items]
Minimum Estimated Useful Life of Assets	3
Maximum Estimated Useful Life of Assets	7
Scenario, Previously Reported [Member]
Property, Plant and Equipment [Line Items]
Basic earnings per share			$ 2.89
Scenario, Actual [Member]
Property, Plant and Equipment [Line Items]
Basic earnings per share			$ 2.88

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Balance Sheet Information (Details) (USD $) In Millions	Apr. 30, 2011	Apr. 30, 2010
Other current assets:
Prepaid taxes	$ 129	$ 99
Other	89	85
Other current assets	218.0	184.0
Property, plant, and equipment:
Land	69	89
Buildings	317	349
Equipment	446	491
Construction in process	11	15
Property, plant, and equipment	843	944
Less accumulated depreciation	450	476
Property, plant and equipment, net	393	468
Accounts payable and accrued expenses:
Accounts payable, trade	126	97
Accrued expenses:
Advertising	72	55
Compensation and commissions	81	90
Excise and other non-income taxes	54	43
Self-insurance claims	11	12
Postretirement benefits	6	6
Interest	7	4
Other	55	35
Accrued expenses	286	245
Accounts payable and accrued expenses	$ 412.0	$ 342.0

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Goodwill and Other Intangible Assets (Details) (USD $) In Millions	12 Months Ended
	Apr. 30, 2011	Apr. 30, 2010
Amount recorded as goodwill
Goodwill, Beginning Balance	$ 666	$ 675
Disposal of Hopland-based wine business (Note14)	(49)
Foreign currency translation adjustment and other	8	(9)
Goodwill, Ending Balance	$ 625	$ 666

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Goodwill and Other Intangible Assets (Details 1) (USD $) In Millions	Apr. 30, 2011	Apr. 30, 2010
Distribution Rights [Member]
Finite-lived intangible assets:
Gross Carrying Amount	$ 25	$ 25
Accumulated Amortization	(22)	(17)
Trademarks and brand names [Member]
Indefinite-lived intangible assets:
Indefinite-lived intangible assets	$ 667	$ 661

XML



Goodwill and Other Intangible Assets (Details Textual) (USD $) In Millions	12 Months Ended
	Apr. 30, 2011	Apr. 30, 2010	Apr. 30, 2009
Goodwill and Other Intangible Assets (Textuals) [Abstract]
Amortization expense	$ 5	$ 5	$ 5
Expected amortization expenses, 2012	3
Don Eduardo [Member]
Indefinite-lived Intangible Assets by Major Class [Line Items]
Book value of indefinite intangible assets exceeded its fair value written down		$ 12

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Commitments (Details) (USD $) In Millions	12 Months Ended
	Apr. 30, 2011	Apr. 30, 2010	Apr. 30, 2009
Commitments (Textuals) [Abstract]
Rental payment under operating leases	$ 22	$ 22	$ 21
Minimum lease payment, 2012	17
Minimum lease payment, 2013	10
Minimum lease payment, 2014	7
Minimum lease payment, 2015	4
Minimum lease payment, 2016	1
Total purchase obligation, 2012	4
Total purchase obligation, 2013	3
Total purchase obligation, 2014	3
Description of purchase obligation	prices to be determined based on market conditions at the time of harvest, which, although not specified, is expected to occur over the next 10 years
Total obligations	$ 4

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Credit Facilities (Details) (USD $) In Millions	12 Months Ended
	Apr. 30, 2011
Credit Facilities (Textuals) [Abstract]
Borrowing Capacity under revolving credit agreement with various domestic and international banks	$ 800
Revolving credit agreement, Expiration Date	4/30/2012
Revolving credit agreement restrictive covenant	consolidated EBITDA (as defined in the agreement) to consolidated interest expense not be less than a ratio of 3 to 1

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Debt (Details) (USD $) In Millions	Apr. 30, 2011	Apr. 30, 2010
Long-term debt
Total long term debt	$ 759	$ 511
Current portion of long-term debt	255	3
Total long term debt excluding current portion	504	508
5.2% notes, due in fiscal 2012 [Member]
Long-term debt
Total long term debt	252	250
5.0% notes due in fiscal 2014 [Member]
Long-term debt
Total long term debt	250	250
2.5% notes, due in fiscal 2016 [Member]
Long-term debt
Total long term debt	249	0
other long-term debt [Member]
Long-term debt
Total long term debt	$ 8	$ 11

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Debt (Details Textual) (USD $) In Millions, unless otherwise specified	Apr. 30, 2011	Apr. 30, 2010
Debt (Textuals) [Abstract]
Debt payment, 2012	$ 253
Debt payment, 2013	3
Debt payment, 2014	253
Debt payment, 2016	$ 250
Weighted average interest rate on short term borrowing outstanding		0.20%

XML



Consolidated Statements of Cash Flows (USD $) In Millions	12 Months Ended
	Apr. 30, 2011	Apr. 30, 2010	Apr. 30, 2009
Cash flows from operating activities:
Net income	$ 572	$ 449	$ 435
Adjustments to reconcile net income to net cash provided by operations:
Gain on sale of business	(38)
Non-cash asset write-downs		12	22
Depreciation and amortization	56	59	55
Gain on sale of brand names			(20)
Stock-based compensation expense	9	8	7
Deferred income taxes	32	11	12
Other	(2)	(1)
Changes in assets and liabilities, excluding the effects of sale of business:
Accounts receivable	(57)	(35)	33
Inventories	(42)	21	(34)
Other current assets	(2)	24	(5)
Accounts payable and accrued expenses	21	(14)	4
Accrued income taxes	7	(2)	(8)
Noncurrent assets and liabilities	(29)	13	(10)
Cash provided by operating activities	527	545	491
Cash flows from investing activities:
Proceeds from sale of business	234
Additions to property, plant, and equipment	(39)	(34)	(49)
Proceeds from sale of property, plant, and equipment	12	2
Acquisition of brand names and trademarks	(1)
Proceeds from sale of brand names and trademarks			17
Computer software expenditures	(3)	(3)	(5)
Cash (used for) provided by investing activities	203	(35)	(37)
Cash flows from financing activities:
Net repayment of short-term borrowings	(188)	(149)	(249)
Repayment of long-term debt	(3)	(153)	(4)
Proceeds from long-term debt	248		249
Debt issuance costs	(2)		(2)
Net payments related to exercise of stock-based awards	(7)	(6)	(6)
Excess tax benefits from stock-based awards	8	3	4
Acquisition of treasury stock	(136)	(158)	(39)
Dividends paid	(326)	(174)	(169)
Cash used for financing activities	(406)	(637)	(216)
Effect of exchange rate changes on cash and cash equivalents	11	19	(17)
Net increase (decrease) in cash and cash equivalents	335	(108)	221
Cash and cash equivalents, beginning of period	232	340	119
Cash and cash equivalents, end of period	567	232	340
Supplemental disclosure of cash paid for:
Interest	26	32	34
Income taxes	$ 203	$ 219	$ 222

XML



Fair Value Measurements (Details) (USD $) In Millions	Apr. 30, 2011	Apr. 30, 2010
Level 1 [Member] | Commodity contracts [Member]
Summary of assets and liabilities measured at fair value on a recurring basis
Assets:	$ 5
Level 1 [Member] | Foreign currency contracts [Member]
Summary of assets and liabilities measured at fair value on a recurring basis
Liabilities:	0	0
Assets:		0
Level 1 [Member] | Interest Rate Swap [Member]
Summary of assets and liabilities measured at fair value on a recurring basis
Assets:	0
Level 2 [Member] | Commodity contracts [Member]
Summary of assets and liabilities measured at fair value on a recurring basis
Assets:	0
Level 2 [Member] | Foreign currency contracts [Member]
Summary of assets and liabilities measured at fair value on a recurring basis
Liabilities:	25	6
Assets:		6
Level 2 [Member] | Interest Rate Swap [Member]
Summary of assets and liabilities measured at fair value on a recurring basis
Assets:	3
Level 3 [Member] | Commodity contracts [Member]
Summary of assets and liabilities measured at fair value on a recurring basis
Assets:	0
Level 3 [Member] | Foreign currency contracts [Member]
Summary of assets and liabilities measured at fair value on a recurring basis
Liabilities:	0	0
Assets:		0
Level 3 [Member] | Interest Rate Swap [Member]
Summary of assets and liabilities measured at fair value on a recurring basis
Assets:	0
Commodity contracts [Member]
Summary of assets and liabilities measured at fair value on a recurring basis
Assets:	5
Foreign currency contracts [Member]
Summary of assets and liabilities measured at fair value on a recurring basis
Liabilities:	25	6
Assets:	0	6
Interest Rate Swap [Member]
Summary of assets and liabilities measured at fair value on a recurring basis
Assets:	$ 3

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Fair Value of Financial Instruments (Details) (USD $) In Millions	Apr. 30, 2011	Apr. 30, 2010	Apr. 30, 2009	Apr. 30, 2008
Assets:
Cash and cash equivalents, Carrying Amount	$ 567	$ 232	$ 340	$ 119
Cash and cash equivalents, Fair Value	567	232
Liabilities:
Short-term borrowings, Carrying Amount	0	188
Short-term borrowings, Fair Value	0	188
Current portion of long-term debt, Carrying Amount	255	3
Current portion of long-term debt, Fair Value	265	3
Long-term debt, less unamortized discount of $1 in 2010 and $2 in 2011	504	508
Long Term Debt, Fair Value	531	547
Commodity contracts [Member]
Assets:
Contracts, Fair Value	5	0
Contracts, Carrying Amount	5	0
Foreign currency contracts [Member]
Assets:
Contracts, Carrying Amount	0	6
Liabilities:
Commodity and Foreign currency contracts, Carrying Amount	25	6
Interest Rate Swap [Member]
Assets:
Contracts, Fair Value	3	0
Contracts, Carrying Amount	$ 3	$ 0

XML



Derivative Financial Instruments (Details) (USD $) In Millions	Apr. 30, 2011	Apr. 30, 2010
Commodity contracts [Member] | Gain Position [Member] | Other Current Assets [Member]
Fair values of derivative instruments
Fair value of derivatives not designated as hedging instruments	$ 5
Foreign currency contracts [Member] | Gain Position [Member] | Accrued Expenses [Member]
Fair values of derivative instruments
Fair value of derivatives not designated as hedging instruments	3
Fair value of derivative instruments designated as cash flow hedges	0	1
Foreign currency contracts [Member] | Gain Position [Member] | Other Current Assets [Member]
Fair values of derivative instruments
Fair value of derivative instruments designation as investment hedges		0
Fair value of derivatives not designated as hedging instruments		3
Fair value of derivative instruments designated as cash flow hedges		7
Foreign currency contracts [Member] | Gain Position [Member] | Other Assets [Member]
Fair values of derivative instruments
Fair value of derivative instruments designated as cash flow hedges		2
Foreign currency contracts [Member] | Gain Position [Member] | Other Liabilities [Member]
Fair values of derivative instruments
Fair value of derivative instruments designated as cash flow hedges	0	0
Interest Rate Swap [Member] | Gain Position [Member] | Other Current Assets [Member]
Fair values of derivative instruments
Fair value of derivative instruments designated as fair value hedges	2
Interest Rate Swap [Member] | Gain Position [Member] | Other Assets [Member]
Fair values of derivative instruments
Fair value of derivative instruments designated as fair value hedges	1
Commodity contracts [Member] | Loss Position [Member] | Other Current Assets [Member]
Fair values of derivative instruments
Fair value of derivatives not designated as hedging instruments	0
Foreign currency contracts [Member] | Loss Position [Member] | Accrued Expenses [Member]
Fair values of derivative instruments
Fair value of derivatives not designated as hedging instruments	0
Fair value of derivative instruments designated as cash flow hedges	(22)	(6)
Foreign currency contracts [Member] | Loss Position [Member] | Other Current Assets [Member]
Fair values of derivative instruments
Fair value of derivative instruments designation as investment hedges		(3)
Fair value of derivatives not designated as hedging instruments		0
Fair value of derivative instruments designated as cash flow hedges		(2)
Foreign currency contracts [Member] | Loss Position [Member] | Other Assets [Member]
Fair values of derivative instruments
Fair value of derivative instruments designated as cash flow hedges		(1)
Foreign currency contracts [Member] | Loss Position [Member] | Other Liabilities [Member]
Fair values of derivative instruments
Fair value of derivative instruments designated as cash flow hedges	(6)	(1)
Interest Rate Swap [Member] | Loss Position [Member] | Other Current Assets [Member]
Fair values of derivative instruments
Fair value of derivative instruments designated as fair value hedges	0
Interest Rate Swap [Member] | Loss Position [Member] | Other Assets [Member]
Fair values of derivative instruments
Fair value of derivative instruments designated as fair value hedges	$ 0

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Derivative Financial Instruments (Details 1) (USD $) In Millions	12 Months Ended
	Apr. 30, 2011	Apr. 30, 2010
Foreign currency contracts [Member] | Sales [Member] | Cash Flow Hedging [Member]
Fair values of derivative instruments affecting statements of operations
Net gain (loss) reclassified from AOCI into income		$ (16)
Foreign currency contracts [Member] | Sales [Member] | Not designated as hedges [Member]
Fair values of derivative instruments affecting statements of operations
Gain (loss) on derivative instruments recognized in income	(10)	(8)
Commodity contracts [Member] | Cost of Sales [Member] | Not designated as hedges [Member]
Fair values of derivative instruments affecting statements of operations
Gain (loss) on derivative instruments recognized in income	10	(1)
Foreign currency contracts [Member] | Other Income [Member] | Not designated as hedges [Member]
Fair values of derivative instruments affecting statements of operations
Gain (loss) on derivative instruments recognized in income	(2)	1
Interest Rate Swap [Member] | Other Income [Member] | Fair Value Hedging [Member]
Fair values of derivative instruments affecting statements of operations
Gain (loss) on derivative instruments recognized in income	2
Interest Rate Swap [Member] | Interest Expense [Member] | Fair Value Hedging [Member]
Fair values of derivative instruments affecting statements of operations
Gain (loss) on derivative instruments recognized in income	3
Foreign currency contracts [Member] | Cash Flow Hedging [Member]
Fair values of derivative instruments affecting statements of operations
Net gain (loss) recognized in AOCI	(27)	(19)
Net Investment Hedging [Member]
Fair values of derivative instruments affecting statements of operations
Net gain (loss) recognized in AOCI	$ (1)	$ (8)

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Derivative Financial Instruments (Details Textual) (USD $) In Millions, unless otherwise specified	Apr. 30, 2011	Apr. 30, 2010
Derivative Financial Instruments (Textuals)
Outstanding foreign currency contracts with notional amounts	$ 392	$ 400
Outstanding exchange-traded futures and options contracts of corn ( In bushels)	3,000,000	3,000,000
Fixed-to-floating interest rate swaps outstanding with a notional value	375	250
Net gains recorded in AOCI expected to reclassify to earnings during the next 12 months	18
Maximum term of outstanding derivative contracts	24 months	27 months
Aggregate fair value of derivatives with creditworthiness requirements that were in a net liability position	$ 22	$ 4

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Pension and Other Postretirement Benefits (Details) (USD $) In Millions	12 Months Ended
	Apr. 30, 2011	Apr. 30, 2010	Apr. 30, 2009	Apr. 30, 2008
Annual Pension and Other Postretirement Benefit Expenses as Per Changed Measurement Date
Retained earnings				$ (3)
Accumulated other comprehensive income				9
Total				6
Pension Benefits [Member]
Annual Pension and Other Postretirement Benefit Expenses as Per Changed Measurement Date
Retained earnings				(2)
Accumulated other comprehensive income				8
Total				6
Change in present value of pension and other postretirement benefit
Obligation at beginning of year	577	415
Service cost	16	10	13
Interest cost	33	32	30
Net actuarial (gain) loss	10	143
Benefits paid	(24)	(23)
Special termination benefits	1		1
Obligation at end of year	613	577	415
Expected benefit payments over the next 10 years
2012	25
2013	26
2014	28
2015	29
2016	30
2017-2021	179
Medical and Life Insurance Benefits [Member]
Annual Pension and Other Postretirement Benefit Expenses as Per Changed Measurement Date
Retained earnings				(1)
Accumulated other comprehensive income				1
Total				0
Change in present value of pension and other postretirement benefit
Obligation at beginning of year	58	44
Service cost	1	1	1
Interest cost	3	3	3
Net actuarial (gain) loss	(10)	12
Plan amendments	6
Retiree contributions	2	2
Benefits paid	(4)	(4)
Obligation at end of year	56	58	44
Expected benefit payments over the next 10 years
2012	3
2013	3
2014	3
2015	3
2016	3
2017-2021	$ 18

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Pension and Other Postretirement Benefits (Details 1) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Apr. 30, 2011	Apr. 30, 2010
Fair value of pension plan assets by category, as well as the actual and target allocations
Total, Plan Assets	$ 467	$ 351
Equity funds, Allocation by asset class, Actual	50.00%	50.00%
Equity funds, Allocation by asset class, Target	47.00%	47.00%
Fixed income funds, Allocation by asset class, Actual	35.00%	33.00%
Fixed income funds, Allocation by asset class, Target	35.00%	30.00%
Real estate funds, Allocation by asset class, Actual	6.00%	7.00%
Real estate funds, Allocation by asset class, Target	8.00%	8.00%
Total commingled trust funds, Allocation by asset class, Actual	91.00%	90.00%
Total commingled trust funds, Allocation by asset class, Target	90.00%	85.00%
Hedge funds, Allocation by asset class, Actual	5.00%	5.00%
Hedge funds, Allocation by asset class, Target	5.00%	5.00%
Private equity, Allocation by asset class, Actual	3.00%	4.00%
Private equity, Allocation by asset class, Target	5.00%	5.00%
Cash and temporary investments, Allocation by asset class, Actual	1.00%	1.00%
Cash and temporary investments, Allocation by asset class, Target	0.00%	0.00%
Other, Allocation by asset class, Actual		0.00%
Other, Allocation by asset class, Target		5.00%
Total, Allocation by Asset Class, Actual	100.00%	100.00%
Total, Allocation By Asset Class, Target	100.00%	100.00%
Change in fair value of Level 3 assets
Ending balance	467	351
Commingled Trust Funds [Member]
Fair value of pension plan assets by category, as well as the actual and target allocations
Total, Plan Assets	425	317
Change in fair value of Level 3 assets
Ending balance	425	317
Commingled Trust Funds [Member] | Level 1 [Member]
Fair value of pension plan assets by category, as well as the actual and target allocations
Total, Plan Assets	0	0
Change in fair value of Level 3 assets
Ending balance	0	0
Commingled Trust Funds [Member] | Level 2 [Member]
Fair value of pension plan assets by category, as well as the actual and target allocations
Total, Plan Assets	416	307
Change in fair value of Level 3 assets
Ending balance	416	307
Commingled Trust Funds [Member] | Level 3 [Member]
Fair value of pension plan assets by category, as well as the actual and target allocations
Total, Plan Assets	9	10
Change in fair value of Level 3 assets
Ending balance	9	10
Equity Funds [Member]
Fair value of pension plan assets by category, as well as the actual and target allocations
Total, Plan Assets	232	176
Change in fair value of Level 3 assets
Ending balance	232	176
Equity Funds [Member] | Level 1 [Member]
Fair value of pension plan assets by category, as well as the actual and target allocations
Total, Plan Assets	0	0
Change in fair value of Level 3 assets
Ending balance	0	0
Equity Funds [Member] | Level 2 [Member]
Fair value of pension plan assets by category, as well as the actual and target allocations
Total, Plan Assets	232	176
Change in fair value of Level 3 assets
Ending balance	232	176
Equity Funds [Member] | Level 3 [Member]
Fair value of pension plan assets by category, as well as the actual and target allocations
Total, Plan Assets	0	0
Change in fair value of Level 3 assets
Ending balance	0	0
Fixed Income Funds [Member]
Fair value of pension plan assets by category, as well as the actual and target allocations
Total, Plan Assets	166	117
Change in fair value of Level 3 assets
Ending balance	166	117
Fixed Income Funds [Member] | Level 1 [Member]
Fair value of pension plan assets by category, as well as the actual and target allocations
Total, Plan Assets	0	0
Change in fair value of Level 3 assets
Ending balance	0	0
Fixed Income Funds [Member] | Level 2 [Member]
Fair value of pension plan assets by category, as well as the actual and target allocations
Total, Plan Assets	166	117
Change in fair value of Level 3 assets
Ending balance	166	117
Fixed Income Funds [Member] | Level 3 [Member]
Fair value of pension plan assets by category, as well as the actual and target allocations
Total, Plan Assets	0	0
Change in fair value of Level 3 assets
Ending balance	0	0
Real Estate funds [Member]
Fair value of pension plan assets by category, as well as the actual and target allocations
Total, Plan Assets	27
Change in fair value of Level 3 assets
Beginning balance	24
Return on assets held at end of year	2
Ending balance	27
Real Estate funds [Member] | Level 1 [Member]
Fair value of pension plan assets by category, as well as the actual and target allocations
Total, Plan Assets	0	0
Change in fair value of Level 3 assets
Ending balance	0	0
Real Estate funds [Member] | Level 2 [Member]
Fair value of pension plan assets by category, as well as the actual and target allocations
Total, Plan Assets	18	14
Change in fair value of Level 3 assets
Ending balance	18	14
Real Estate funds [Member] | Level 3 [Member]
Fair value of pension plan assets by category, as well as the actual and target allocations
Total, Plan Assets	9	10
Change in fair value of Level 3 assets
Beginning balance	10	15
Return on assets held at end of year		(4)
Sales and settlements	(3)	(1)
Ending balance	9	10
Hedge Funds [Member]
Fair value of pension plan assets by category, as well as the actual and target allocations
Total, Plan Assets	24
Change in fair value of Level 3 assets
Beginning balance	19
Return on assets held at end of year	1
Ending balance	24
Hedge Funds [Member] | Level 1 [Member]
Fair value of pension plan assets by category, as well as the actual and target allocations
Total, Plan Assets	0	0
Change in fair value of Level 3 assets
Ending balance	0	0
Hedge Funds [Member] | Level 2 [Member]
Fair value of pension plan assets by category, as well as the actual and target allocations
Total, Plan Assets	0	0
Change in fair value of Level 3 assets
Ending balance	0	0
Hedge Funds [Member] | Level 3 [Member]
Fair value of pension plan assets by category, as well as the actual and target allocations
Total, Plan Assets	24	19
Change in fair value of Level 3 assets
Beginning balance	19	4
Return on assets held at end of year		1
Return on assets sold during year	(1)	(1)
Purchases and settlements	6	17
Sales and settlements	(1)	(2)
Ending balance	24	19
Private Equity [Member]
Fair value of pension plan assets by category, as well as the actual and target allocations
Total, Plan Assets	16
Change in fair value of Level 3 assets
Beginning balance	13
Return on assets held at end of year	1
Ending balance	16
Private Equity [Member] | Level 1 [Member]
Fair value of pension plan assets by category, as well as the actual and target allocations
Total, Plan Assets	0	0
Change in fair value of Level 3 assets
Ending balance	0	0
Private Equity [Member] | Level 2 [Member]
Fair value of pension plan assets by category, as well as the actual and target allocations
Total, Plan Assets	0	0
Change in fair value of Level 3 assets
Ending balance	0	0
Private Equity [Member] | Level 3 [Member]
Fair value of pension plan assets by category, as well as the actual and target allocations
Total, Plan Assets	16	13
Change in fair value of Level 3 assets
Beginning balance	13	13
Return on assets sold during year		(1)
Purchases and settlements	4	2
Sales and settlements	(2)	(1)
Ending balance	16	13
Cash And Temporary Investments [Member]
Fair value of pension plan assets by category, as well as the actual and target allocations
Total, Plan Assets	2	2
Change in fair value of Level 3 assets
Ending balance	2	2
Cash And Temporary Investments [Member] | Level 1 [Member]
Fair value of pension plan assets by category, as well as the actual and target allocations
Total, Plan Assets	2	2
Change in fair value of Level 3 assets
Ending balance	2	2
Cash And Temporary Investments [Member] | Level 2 [Member]
Fair value of pension plan assets by category, as well as the actual and target allocations
Total, Plan Assets	0	0
Change in fair value of Level 3 assets
Ending balance	0	0
Cash And Temporary Investments [Member] | Level 3 [Member]
Fair value of pension plan assets by category, as well as the actual and target allocations
Total, Plan Assets	0	0
Change in fair value of Level 3 assets
Ending balance	0	0
Other [Member]
Fair value of pension plan assets by category, as well as the actual and target allocations
Total, Plan Assets		0
Change in fair value of Level 3 assets
Ending balance		0
Other [Member] | Level 1 [Member]
Fair value of pension plan assets by category, as well as the actual and target allocations
Total, Plan Assets		0
Change in fair value of Level 3 assets
Ending balance		0
Other [Member] | Level 2 [Member]
Fair value of pension plan assets by category, as well as the actual and target allocations
Total, Plan Assets		0
Change in fair value of Level 3 assets
Ending balance		0
Other [Member] | Level 3 [Member]
Fair value of pension plan assets by category, as well as the actual and target allocations
Total, Plan Assets		0
Change in fair value of Level 3 assets
Ending balance		0
Level 1 [Member]
Fair value of pension plan assets by category, as well as the actual and target allocations
Total, Plan Assets	2	2
Change in fair value of Level 3 assets
Ending balance	2	2
Level 2 [Member]
Fair value of pension plan assets by category, as well as the actual and target allocations
Total, Plan Assets	416	307
Change in fair value of Level 3 assets
Ending balance	416	307
Level 3 [Member]
Fair value of pension plan assets by category, as well as the actual and target allocations
Total, Plan Assets	49	42
Change in fair value of Level 3 assets
Beginning balance	42	32
Return on assets held at end of year	4	(3)
Return on assets sold during year	(1)	(2)
Purchases and settlements	10	19
Sales and settlements	(6)	(4)
Ending balance	$ 49	$ 42

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Pension and Other Postretirement Benefits (Details 2) (USD $) In Millions	12 Months Ended
	Apr. 30, 2011	Apr. 30, 2010	Apr. 30, 2009
Change in fair value of the pension plan assets
Ending balance	$ 467	$ 351
Funded status of plans
Assets	467	351
Funded status is recorded on the accompanying consolidated balance sheets
Accounts payable and accrued expenses	(6)	(6)
Accrued postretirement benefits	(203)	(283)
Pension plans that have assets in excess of their accumulated benefit obligations with those whose assets are less than their obligations.
Plans with assets in excess of accumulated benefit obligation, Plan Assets	50	45
Plans with assets in excess of accumulated benefit obligation, Accumulated Benefit Obligation	41	38
Plans with assets in excess of accumulated benefit obligation, Projected Benefit Obligation	42	40
Plans with accumulated benefit obligation in excess of assets, Plan Assets	417	306
Plans with accumulated benefit obligation in excess of assets, Accumulated Benefit Obligation	505	476
Plans with accumulated benefit obligation in excess of assets, Projected Benefit Obligation	571	537
Total, Plan Assets	467	351
Pension Benefits [Member]
Change in fair value of the pension plan assets
Beginning balance	351	284
Actual return on plan assets	64	77
Company contributions	76	13
Benefits paid	(24)	(23)
Ending balance	467	351	284
Funded status of plans
Assets	467	351	284
Obligations	(613)	(577)	(415)
Funded status	(146)	(226)
Funded status is recorded on the accompanying consolidated balance sheets
Other assets	7	5
Accounts payable and accrued expenses	(3)	(3)
Accrued postretirement benefits	(150)	(228)
Net liability	(146)	(226)
Accumulated other comprehensive loss:
Net actuarial loss (gain)	263	299
Prior service cost	3	4
Total	266	303
Pension plans that have assets in excess of their accumulated benefit obligations with those whose assets are less than their obligations.
Total, Plan Assets	467	351	284
Total, Projected Benefit Obligation	613	577	415
Pension Expense
Service cost	16	10	13
Interest cost	33	32	30
Special termination benefits	1		1
Expected return on plan assets	(36)	(34)	(35)
Amortization of:
Prior service cost	1	1	1
Net actuarial loss	18	4	6
Net expense	33	13	16
Medical and Life Insurance Benefits [Member]
Change in fair value of the pension plan assets
Beginning balance	0	0
Retiree contributions	2	2
Company contributions	2	2
Benefits paid	(4)	(4)
Ending balance	0	0	0
Funded status of plans
Assets	0	0	0
Obligations	(56)	(58)	(44)
Funded status	(56)	(58)
Funded status is recorded on the accompanying consolidated balance sheets
Other assets	0	0
Accounts payable and accrued expenses	(3)	(3)
Accrued postretirement benefits	(53)	(55)
Net liability	(56)	(58)
Accumulated other comprehensive loss:
Net actuarial loss (gain)	(3)	7
Prior service cost	6	1
Total	3	8
Pension plans that have assets in excess of their accumulated benefit obligations with those whose assets are less than their obligations.
Total, Plan Assets	0	0	0
Total, Projected Benefit Obligation	56	58	44
Pension Expense
Service cost	1	1	1
Interest cost	3	3	3
Amortization of:
Net expense	4	4	4
Plan Assets [Member]
Change in fair value of the pension plan assets
Ending balance	467	351
Funded status of plans
Assets	467	351
Pension plans that have assets in excess of their accumulated benefit obligations with those whose assets are less than their obligations.
Total, Plan Assets	467	351
Accumulated Benefit Obligation [Member]
Pension plans that have assets in excess of their accumulated benefit obligations with those whose assets are less than their obligations.
Total, Accumulated Benefit Obligation	546	514
Projected Benefit Obligation [Member]
Funded status of plans
Obligations	(613)	(577)
Pension plans that have assets in excess of their accumulated benefit obligations with those whose assets are less than their obligations.
Total, Projected Benefit Obligation	$ 613	$ 577

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Pension and Other Postretirement Benefits (Details 3) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Apr. 30, 2011	Apr. 30, 2010	Apr. 30, 2009
Pension Benefits [Member]
Postretirement medical and life insurance benefit expense
Service cost	$ 16	$ 10	$ 13
Interest cost	33	32	30
Net expense	33	13	16
Amounts recognized in other comprehensive income
Prior service cost			1
Actuarial (gain) loss	(18)	100	92
Amortization reclassified to net income:
Prior service cost	(1)	(1)	(1)
Net actuarial loss	(18)	(4)	(6)
Net amount recognized in other comprehensive income	(37)	95	86
Assumptions used in computing benefit plan obligations
Discount rate	5.67%	5.91%
Rate of salary increase	4.00%	4.00%
Assumptions used in computing benefit plan expense
Discount rate	5.91%	7.94%	6.87%
Rate of salary increase	4.00%	4.00%	4.00%
Expected return on plan assets	8.50%	8.50%	8.75%
Medical and Life Insurance Benefits [Member]
Postretirement medical and life insurance benefit expense
Service cost	1	1	1
Interest cost	3	3	3
Net expense	4	4	4
Amounts recognized in other comprehensive income
Prior service cost	5
Actuarial (gain) loss	(10)	12	(9)
Amortization reclassified to net income:
Net amount recognized in other comprehensive income	$ (5)	$ 12	$ (9)
Assumptions used in computing benefit plan obligations
Discount rate	5.59%	5.78%
Assumptions used in computing benefit plan expense
Discount rate	5.78%	7.80%	6.87%
Assumed health care cost trend rates
Present rate before age 65	7.50%	8.00%
Present rate age 65 and after	7.50%	8.00%

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Pension and Other Postretirement Benefits (Details Textual) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Apr. 30, 2011	Apr. 30, 2010	Apr. 30, 2009
Pension and Other Postretirement Benefits (Textuals)
Project health care cost trend rates to decline gradually to, by 2016 and remain thereafter	5.00%
Percentage change in Health assumed Health care costs	1.00%
1% increase/decrease in assumed health care cost trend rates would have increased/decreased the accumulated postretirement benefit obligation	$ 6
1% increase/decrease in assumed health care cost trend rates would have increased/decreased the aggregate service and interest costs	1
Pension Benefits [Member]
Defined Benefit Plan Disclosure [Line Items]
Reduction in benefit obligations	(24)	(23)
Expected contribution to benefit plans in 2012	40
Estimated amount of prior service cost that will be amortized from accumulated other comprehensive loss into pension expense in 2012	1
Estimated amount of net actuarial loss that will be amortized from accumulated other comprehensive loss into pension expense in 2012	19
Medical and Life Insurance Benefits [Member]
Defined Benefit Plan Disclosure [Line Items]
Reduction in benefit obligations	(4)	(4)
Expected contribution to benefit plans in 2012	3
Saving Plan [Member]
Defined Benefit Plan Disclosure [Line Items]
Expense For Matching Contributions	$ 9	$ 8	$ 10

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Consolidated Statements of Stockholders' Equity (USD $) In Millions, except Share data in Thousands	Total	Additional Paid-in Capital	Retained Earnings	Treasury Stock, at Cost	Accumulated Other Comprehensive Income (Loss)	Common Class A [Member]	Common Class B [Member]
Beginning Balance at Apr. 30, 2008		$ 74	$ 1,931	$ (304)	$ 5	$ 9	$ 10
Beginning Balance, shares at Apr. 30, 2008						56,573	64,019
Net income	435		435
Cash dividends ($1.12, $1.18, and $2.24 per share in 2009, 2010, and 2011, respectively)			169
Stock distribution (Note 1)			(5)				5
Stock distribution (Note 1), shares							30,175
Net other comprehensive income (loss)	(147)				(147)
Change in measurement date of postretirement benefit plans, net of tax of $2 and $(6) (Note 11)			(3)		9
Acquisition of treasury stock				39
Acquisition of treasury stock, shares						22	843
Stock issued under compensation plans				10
Stock issued under compensation plans, shares						39	186
Stock-based compensation expense		5		2
Loss on issuance of treasury stock issued under compensation plans		16
Excess tax benefits from stock-based awards		4
Total Common Shares Outstanding	150,127
Ending Balance at Apr. 30, 2009	1,816	67	2,189	(331)	(133)	9	15
Ending Balance, shares at Apr. 30, 2009						56,590	93,537
Net income	449		449
Cash dividends ($1.12, $1.18, and $2.24 per share in 2009, 2010, and 2011, respectively)			174
Net other comprehensive income (loss)	(43)				(43)
Acquisition of treasury stock				158
Acquisition of treasury stock, shares						12	3,398
Stock issued under compensation plans				13
Stock issued under compensation plans, shares						23	223
Stock-based compensation expense		8
Loss on issuance of treasury stock issued under compensation plans		19
Excess tax benefits from stock-based awards		3
Total Common Shares Outstanding	146,963
Ending Balance at Apr. 30, 2010	1,895	59	2,464	(476)	(176)	9	15
Ending Balance, shares at Apr. 30, 2010						56,601	90,362
Net income	572		572
Cash dividends ($1.12, $1.18, and $2.24 per share in 2009, 2010, and 2011, respectively)			326
Net other comprehensive income (loss)	45				45
Acquisition of treasury stock				136
Acquisition of treasury stock, shares						40	2,200
Stock issued under compensation plans				14
Stock issued under compensation plans, shares							267
Stock-based compensation expense		9
Loss on issuance of treasury stock issued under compensation plans		21
Excess tax benefits from stock-based awards		8
Total Common Shares Outstanding	144,990
Ending Balance at Apr. 30, 2011	$ 2,060	$ 55	$ 2,710	$ (598)	$ (131)		$ 15
Ending Balance, shares at Apr. 30, 2011						56,561	88,429

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Stock-Based Compensation (Details) (USD $) In Millions, except Share data in Thousands, unless otherwise specified	12 Months Ended
	Apr. 30, 2011
Summary of stock options and SSARs granted under the plan
Stock Options and SSARs, shares, outstanding at May 1, 2010	4,051
Stock Options and SSARs, Weighted Average Exercise Price per Award, Outstanding, Beginning Balance	$ 41.31
Stock Options and SSARs Granted	415
Stock Options and SSARs, Granted, Weighted Average Exercise Price per Award	$ 61.24
Stock Options and SSARs, Exercised	(738)
Stock Options and SSARs, Exercised, Weighted Average Exercise Price per Award	$ 30.26
Stock Options and SSARs, Forfeited or expired	(22)
Stock Options and SSARs, Forfeited or expired, Weighted Average Exercise Price per Award	$ 49.52
Stock Options and SSARs, shares, outstanding at April 30, 2011	3,706
Stock Options and SSARs, Weighted Average Exercise Price per Award, Outstanding, Ending Balance	$ 45.69
Stock Options and SSARs, Outstanding Weighted Average Remaining Contractual Term	5.0
Share Based Compensation Arrangement By Share Based Payment Award Options Stock Settled Appreciation Rights Vested And Expected To Vest Outstanding Aggregate Intrinsic Value	$ 97
Stock Options and SSARs, Exercisable, Ending Balance	2,470
Stock Options and SSARs Exercisable, Weighted Average Exercise Price per Award, Ending Balance	$ 41.77
Stock Options and SSARs, Exercisable, Weighted Average Remaining Contractual Term	3.6
Stock Options and SSARs, Exercisable, Aggregate Intrinsic Value	$ 74

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Stock-Based Compensation (Details 1)	12 Months Ended
	Apr. 30, 2011	Apr. 30, 2010	Apr. 30, 2009
Assumptions used for fair value estimation
Risk-free interest rate	2.10%	3.00%	3.50%
Expected volatility	23.70%	22.60%	18.10%
Expected dividend yield	1.90%	1.90%	1.80%
Expected life (years)	6	6	6

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Stock-Based Compensation (Details 2) (Restricted Stock [Member], USD $) In Thousands, except Per Share data	12 Months Ended
	Apr. 30, 2011
Restricted Stock [Member]
Summary of changes in outstanding Restricted stock units and restricted stock
Outstanding at May 1, 2010	176
Weighted Average Fair Value at Grant Date, Beginning Balance	$ 50.59
Granted	28
Weighted Average Fair Value at Grant Date, Granted	$ 61.64
Vested	(122)
Weighted Average Fair Value at Grant Date, Vested	$ 51.21
Outstanding at April 30, 2011	82
Weighted Average Fair Value at Grant Date, Ending Balance	$ 53.28

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Stock-Based Compensation (Details Textuals) (USD $)	12 Months Ended
	Apr. 30, 2011	Apr. 30, 2010	Apr. 30, 2009
Stock Based Compensation (Textuals) [Abstract]
The total intrinsic value of options and SSARs Rights exercised	$ 25,000,000	$ 18,000,000	$ 17,000,000
Period after which stock options and SSARs granted under the Plan become exercisable	3 years
Vesting Period for Which Stock options and SSARs granted under the Plan become expire after Grant date	7 years
Grant-date fair value per award	12.66	9.42	11.24
Special Cash Dividend Per Share On Class A and Class B Common Stock		$ 1
Stock-based incentive awards on a pre-tax	9,000,000	8,000,000	7,000,000
Compensation expense partially offset by deferred income tax benefits	4,000,000	3,000,000	3,000,000
Total unrecognized compensation cost related to non-vested stock-based compensation	9,000,000
Cost recognized over weighted-average period (in years)	2.0
Omnibus Compensation Plan 2004 [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares authorized under 2004 Omnibus Compensation Plan	7,433,000
Shares issued under 2004 Omnibus Compensation Plan	4,265,000
Restricted Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares outstanding under Restricted stock units	82,000	176,000
Weighted-average remaining restriction period (in years)	1.8
Total fair value of Restricted stock units and restricted stock vested	$ 9,000,000	$ 2,000,000	$ 3,000,000

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Restructuring Costs (Details) (USD $) In Millions	12 Months Ended
	Apr. 30, 2009
Restructuring Costs (Textuals) [Abstract]
Expense Related To to reduce our workforce through involuntary employment termination and voluntary early retirement	$ 12
Amount of material additional expenses incurred as a result of reduction in workforce	$ 0

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Other Income And Expense (Details 1) (USD $) In Millions	12 Months Ended
	Apr. 30, 2011	Apr. 30, 2010	Apr. 30, 2009
Consolidated statement of operations
Net sales	$ 3,404	$ 3,226	$ 3,192
Selling, general, and administrative expenses	(574)	(539)	(548)
Other income	76	(7)	20
Income taxes	(257)	(233)	(195)
Net income	572	449	435
Other income expense [Member]
Consolidated statement of operations
Net sales	(3)
Selling, general, and administrative expenses	(6)
Other income	62
Income taxes	(15)
Net income	$ 38

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Other Income and Expense (Details) (USD $) In Millions	12 Months Ended
	Apr. 30, 2011	Apr. 30, 2010	Apr. 30, 2009
Other Income And Expense (Textuals) [Abstract]
Gain on sale of Bolla and Fontana Candida trademarks			$ 20
Sales price (subject to a post-closing working capital adjustment) in cash	234
Net income	572	449	435
Other income expense [Member]
Other Income And Expense (Textuals) [Abstract]
Gain on sale of Bolla and Fontana Candida trademarks			20
Impairment charge of Don Eduardo trademark		12
Net income	$ 38

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Income Taxes (Details) (USD $) In Millions	12 Months Ended
	Apr. 30, 2011	Apr. 30, 2010	Apr. 30, 2009
Domestic and foreign components of our income before income taxes
United States	$ 696	$ 576	$ 533
Foreign	133	106	97
Income before income taxes	829	682	630
Deferred tax assets:
Postretirement and other benefits	94	125
Accrued liabilities and other	22	26
Loss and credit carryforwards	50	56
Valuation allowance	(23)	(40)
Total deferred tax assets, net	143	167
Deferred tax liabilities:
Trademarks and brand names	(195)	(168)
Property, plant, and equipment	(46)	(37)
Total deferred tax liabilities, net	(241)	(205)
Net deferred tax liability	(98)	(38)
Current:
U.S. federal	171	175	142
Foreign	41	28	26
State and local	18	19	15
Current Income Tax Expense	230	222	183
Deferred:
U.S. federal	46	16	14
Foreign	(1)	(5)	(2)
State and local	(18)
Deferred Income Tax Expense	27	11	12
Total income tax expense	$ 257	$ 233	$ 195

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Income Taxes (Details 1) (USD $) In Millions, unless otherwise specified	12 Months Ended
	Apr. 30, 2011	Apr. 30, 2010	Apr. 30, 2009
Reconciles our effective tax rate to the federal statutory tax rate in the United States
U.S. federal statutory rate	35.00%	35.00%	35.00%
State taxes, net of U.S. federal tax benefit	1.10%	1.80%	1.80%
Income taxed at other than U.S. federal statutory rate	(0.40%)	(1.00%)	(1.30%)
Tax benefit from U.S. manufacturing	(2.20%)	(1.70%)	(1.70%)
Capital loss benefit	(2.70%)		(1.20%)
Nondeductible goodwill on Fetzer sale	2.10%
Other, net	(1.90%)		(1.50%)
Effective rate	31.00%	34.10%	31.10%
Reconciliation of beginning and ending unrecognized tax benefits
Unrecognized tax benefits at beginning of year	$ 35	$ 26	$ 35
Additions for tax positions provided in prior periods	1		1
Additions for tax positions provided in current period	14	13	4
Decreases for tax positions provided in prior years	(4)
Settlements of tax positions in the current period	(5)	(3)	(2)
Lapse of statutes of limitations	(1)	(1)	(12)
Unrecognized tax benefits at end of year	$ 40	$ 35	$ 26

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Income Taxes (Details Textual) (USD $) In Millions	3 Months Ended
	Apr. 30, 2011	Apr. 30, 2010	Apr. 30, 2009	Apr. 30, 2008
Income Taxes (Textuals) [Abstract]
Valuation allowance	$ 23	$ 40
Loss and credit carryforwards U.S. capital losses	50	56
Foreign credit carryforwards	8
Deferred tax liabilities not provided on undistributed earnings of certain foreign subsidiaries	390	365
Additional deferred tax liabilities on undistributed earnings of certain foreign subsidiaries	76	73
Adjustment to reverse of income tax expense that was incorrectly recognized in prior periods	8
Gross unrecognized tax benefits	40	35	26	35
Reduction in effective income tax rate if recognized	22
Total gross interest and penalties	11	8	6
Increase in gross unrecognized tax benefits	0
U.K. Non Trading Loss [Member]
Additional Income Taxes (Textuals) [Abstract]
Non-trading loss carryforward	47
Others [Member]
Additional Income Taxes (Textuals) [Abstract]
Other foreign net operating losses	56
Others [Member] | Foreign [Member]
Additional Income Taxes (Textuals) [Abstract]
Other foreign net operating losses, Expire	25
Other foreign net operating losses, not Expire	31
Brown-Forman Beverages Europe [Member]
Additional Income Taxes (Textuals) [Abstract]
Non-trading loss carryforward			$ 13

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Statements of Stockholder's Equity (Parenthetical) (USD $) In Millions, except Per Share data	12 Months Ended
	Apr. 30, 2011	Apr. 30, 2010	Apr. 30, 2009
Retained Earnings
Cash dividends	$ 2.24	$ 1.18	$ 1.12
Change in measurement date of postretirement benefit plans, tax			$ 2
Accumulated Other Comprehensive Income (Loss)
Change in measurement date of postretirement benefit plans, tax			$ (6)

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Segment Information (Details) (USD $) In Millions	12 Months Ended
	Apr. 30, 2011	Apr. 30, 2010	Apr. 30, 2009
Net sales:
Net sales, product category	$ 3,404	$ 3,226	$ 3,192
Spirits [Member]
Net sales:
Net sales, product category	3,102	2,916	2,832
Wine [Member]
Net sales:
Net sales, product category	$ 302	$ 310	$ 360

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Segment Information (Details 1) (USD $) In Millions	12 Months Ended
	Apr. 30, 2011	Apr. 30, 2010	Apr. 30, 2009
Net sales by geographic region:
Net Sales, United States	$ 1,525	$ 1,529	$ 1,542
Net Sales, geographic region	3,404	3,226	3,192
Europe
Net sales by geographic region:
Net Sales, Europe and Other	909	879	892
Other
Net sales by geographic region:
Net Sales, Europe and Other	$ 970	$ 818	$ 758

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Segment Information (Details) (Textuals) (Mexico [Member], USD $) In Millions	Apr. 30, 2011	Apr. 30, 2010
Mexico [Member]
Segment Information (Textuals) [Abstract]
Net book value of property, plant, and equipment	$ 65	$ 62

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Schedule II - Valuation and Qualifying Accounts (Details) (USD $) In Millions	12 Months Ended
	Apr. 30, 2011	Apr. 30, 2010	Apr. 30, 2009
Allowance for Doubtful Accounts [Member]
Movement in Valuation Allowances and Reserves [Roll Forward]
Balance at Beginning of Period	$ 16	$ 15	$ 19
Additions Charged to costs and Expenses	1
Additions Accounts Charged to Other	1	1
Deductions			4
Balance At End of Period	18	16	15
Accrued Restructuring Costs [Member]
Movement in Valuation Allowances and Reserves [Roll Forward]
Balance at Beginning of Period	2	12	0
Additions Charged to costs and Expenses			12
Deductions	2	10
Balance At End of Period	$ 0	$ 2	$ 12

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Consolidated Statements of Comprehensive Income (USD $) In Millions	12 Months Ended
	Apr. 30, 2011	Apr. 30, 2010	Apr. 30, 2009
Consolidated Statements of Comprehensive Income [Abstract]
Net income	$ 572	$ 449	$ 435
Other comprehensive (loss) income:
Foreign currency translation adjustment	37	21	(109)
Amounts related to postretirement benefit plans:
Net actuarial (loss) gain and prior service cost, net of tax of $33, $46, and $(9) in 2009, 2010, and 2011, respectively	13	(66)	(52)
Reclassification to earnings, net of tax of $(3), $(2), and $(8) in 2009, 2010, and 2011, respectively	12	3	4
Amounts related to cash flow hedges:
Net gain (loss) on hedging instruments, net of tax of $(12), $7, and $10 in 2009, 2010, and 2011, respectively	(17)	(11)	16
Reclassification to earnings, net of tax of $4, and $(6) in 2009 and 2010, respectively		10	(6)
Net other comprehensive (loss) income	45	(43)	(147)
Total comprehensive income	$ 617	$ 406	$ 288

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Consolidated Statements of Comprehensive Income (Parenthetical) (USD $) In Millions	12 Months Ended
	Apr. 30, 2011	Apr. 30, 2010	Apr. 30, 2009
Amounts related to postretirement benefit plans:
Net actuarial (loss) gain and prior service cost, tax	$ (9)	$ 46	$ 33
Reclassification to earnings, tax	(8)	(2)	(3)
Amounts related to cash flow hedges:
Net (loss) gain on hedging instruments, tax	10	7	(12)
Reclassification to earnings, tax		$ (6)	$ 4