InBev, the world's largest brewer, is headquartered in Leuven, Belgium. In 2007, InBev employed nearly 89,000 people worldwide to manage more than 200 brands. It has sales in over 130 countries primarily in North America, Europe, Asia Pacific, and Latin America. In 2008, InBev purchased Anheuser-Busch, the largest brewing company in the United States. As a result of this transaction, the combined company is called Anheuser-Busch Inbev.
1. Obtain the 2007 Annual reports of InBev and Anheuser-Busch, and comment on the impact of foreign currencies on their businesses. What impact will the 2008 business combination have on financial reporting related to foreign currency fluctuations on the new Anheuser-Busch InBev company?
2. Operating in over 130 countries, InBev is affected by differing economic conditons in many markets around the world. Often weaknesses in some currencies are offset by strengths in others. List a few strategies that multinationals can use to protect themselves against fluctuation of exchange rates.