Many companies make annual reports available on their corporate Internet home page. Annual reports also can be accessed through the SEC's EDGAR system at www.sec.gov (under Filing
Type, search for 10-K). Access the most recent annual report for International Flavors and
Fragrances (IFF).

1. Identify the location(s) in the annual report where IFF provides disclosures related to its management of foreign exchange risk.

Through the most recent form 10-K of IFF (2015), three locations where foreign exchange risk is disclosed were found:
a. Part I, Item 1A. Risk Factors: “The impact of currency fluctuation or devaluation in the international markets” (Page 15)
b. Part II, Item 7A. Quantitative and Qualitative Disclosures About Market Risk (Page 51)
c. Part IV, Item 15. Note 15. Financial Instruments: Derivatives (Page 88)

2. Determine the types of hedging instruments the company uses and the types of hedges in which it engages.

IFF is a New York-based global producer of flavors and fragrances providing products to customers in around 150 countries. As described in its expansion strategy in 2015, it is necessary for IFF to put efforts in managing its foreign exchange risk. The consolidated financial statements include financial results of operations outside the U.S. that are translated from

reported local currency at applicable exchange rates. However, the fluctuation of the exchange rate between local currencies and U.S. dollars always exists and affects the recorded result of profitability. In 2015, the Euro has been weakened and resulted in about $33 million impact (IFF,
2016). To mitigate the adverse impact on financial condition, IFF employs a number of foreign currency hedging activities.

IFF engages in hedges of foreign currency denominated assets and liabilities and hedges of forecasted transactions. In doing this, it reduces