Emerson Electric (EMR) 10-K risk factor changes: FY2014 vs FY2013

A significant element of our competitive strategy is to deliver solutions to our customers by manufacturing [removed: high quality] [added: high-quality] products at the best relevant global cost.

In [removed: 2013] [added: 2014] and in past years, we have made various acquisitions and entered into joint venture arrangements intended to complement or expand our business, and may continue to do so in the future (see Note 3 of Notes to Consolidated Financial Statements of the [removed: 2013] [added: 2014] Annual Report, which note is hereby incorporated by reference).

[removed: If] [added: Additionally, if] our customers, suppliers [removed: and] [added: or] financial institutions are unable to access the capital markets to meet their commitments to the Company, our business could be adversely impacted.

[removed: A significant portion of our sales is outside the United States, and we] [added: We] expect sales from non-U.S. markets to continue to represent a significant portion of our total sales.

International sales and operations are subject to changes in local government regulations and policies, including those related to tariffs and trade barriers, investments, taxation, exchange [removed: controls,] [added: controls] and repatriation of earnings, which could adversely affect our results.

Recessions, Adverse Market Conditions or Downturns in [removed: the] End Markets We Serve May Negatively [removed: Impact Segment Revenues and Operating Results][added: Affect Our Operations]

[removed: Segment revenues, operating results and cash flows have varied in] [added: In] the [removed: past and may be] [added: past, our operations have been] exposed to significant volatility [removed: from quarter to quarter in the future] due to changes in general economic conditions, recessions or adverse conditions in the end markets we serve.

Moreover, during economic downturns we may undertake more extensive rationalization actions and [removed: therefore] incur higher [removed: rationalization expense during such periods.][added: costs.]

If our rationalization actions are not sufficiently [removed: effective or if we must incur rationalization costs beyond what we anticipate,] [added: effective,] we may not be able to achieve our anticipated operating results.

We are, and may in the future be, a party to a number of legal proceedings and claims, including those involving [added: intellectual property,] product liability and environmental matters, several of which claim, or may in the future claim, significant damages.

We regularly seek growth through strategic acquisitions.

We sell, manufacture, engineer and purchase products in overseas markets and a significant portion of our sales occur in mature and emerging markets outside the United States.

In the future, similar changes could adversely impact overall sales, operating results and cash flows.

In addition, these factors could lead to impairment charges for goodwill or other long-lived assets.

Security Breaches or Disruptions of Our Information Technology Systems Could Adversely Affect Our Business

The Company utilizes a variety of information technology systems to manage and operate its businesses.

Despite the implementation of extensive security measures (including access controls, data encryption, vulnerability assessments, continuous monitoring, and maintenance of back-up and protective systems), the Company’s information technology systems are potentially vulnerable to unauthorized access, computer viruses, cyber attack and other events, ranging from individual attempts to advanced persistent threats.

Although considered unlikely, it is possible a security breach could result in theft of trade secrets or other intellectual property or disclosure of confidential customer, supplier or employee information.

Should the Company be unable to prevent security breaches, disruptions could have an adverse effect on our operations, as well as expose the Company to litigation, increased cyber security protection costs, and reputational damage.

We are a company that, from time to time, seeks to grow through strategic acquisitions.

We sell, manufacture, engineer and purchase products in overseas markets.

These changes could adversely impact overall sales, operating results and cash flows, which in turn could trigger impairment of goodwill or other long-lived assets due to the fair value of such assets falling below the Company’s carrying value.

The information from the [removed: 2013] [added: 2014] Annual Report set forth in Exhibit 13 hereto under “Results of Operations,” “Business Segments,” “Financial Position, Capital Resources and Liquidity,” “Critical Accounting Policies,” [added: "Other Items"] and "Safe Harbor Statement" is hereby incorporated by reference.

[added: Management believes that presenting earnings, earnings per share, return on common stockholders' equity] and return on total capital excluding these items is more representative of the Company’s operational performance and may be more useful for investors (U.S. GAAP measures: earnings, earnings per share, return on common stockholders’ equity, return on total capital).

The determination of operating cash flow adds back [removed: non-cash] [added: noncash] depreciation expense to earnings and thereby does not reflect a charge for necessary capital expenditures.

Fiscal 2014 Outlook

Global economic indicators remain mixed and uncertain, but momentum appears to be on a slightly favorable trend.

Process Management orders are expected to remain solid through 2014.

Improvement in Europe and Asia is expected to support modest near-term sales growth in Industrial Automation, while also supporting positive near-term order trends in the Network Power Systems business.

For Climate Technologies, residential and refrigeration strength and an expected commercial end market recovery support a moderate growth outlook.

Solid residential end market momentum supports an outlook for modest near-term growth in Commercial & Residential Solutions.

Based on a forecast of global gross fixed investment growth of 2.5 to 4 percent, Emerson underlying sales are expected to grow 3 to 5 percent in 2014, excluding (4) percent from acquisitions and the previously announced divestiture of the embedded computing and power business.

Reported sales are expected to change (1) to 1 percent.

After managing costs aggressively through sluggish economic conditions the past two years, incremental growth investments will accelerate next year, resulting in only slight margin expansion.

Earnings per share are expected to increase 4 to 7 percent excluding an approximate 30 percent impact from impairment and repatriation charges, or increase 33 to 38 percent on a reported basis.The embedded computing and power transaction impact to 2014 earnings per share is expected to be approximately neutral, as supplemental share repurchase offsets the earnings decline.

Management believes that presenting earnings, earnings per share, return on common stockholders' equity

The information from the [removed: 2013] [added: 2014] Annual Report set forth in Exhibit 13 hereto under "Financial Instruments" is hereby incorporated by reference.

Emerson is organized into the [added: five] business segments described below, based on the nature of [added: the] products and services [removed: provided.][added: rendered:]

| • | Process Management - [removed: Providing] [added: provides] measurement, control and diagnostic capabilities for automated industrial processes producing items such as fuels, chemicals, foods, medicines and power. |

| • | Industrial Automation - [removed: Bringing] [added: brings] integrated manufacturing solutions to diverse industries worldwide. |

| • | Network Power - [removed: Providing] [added: provides] power conditioning and reliability, and environmental control to help keep telecommunication systems, data networks and other critical business applications [removed: continuously operating.] [added: operating continuously.] |

| • | Climate Technologies - [removed: Enhancing] [added: enhances] household and commercial [removed: comfort] [added: comfort,] as well as food safety and energy [removed: efficiency] [added: efficiency,] through air conditioning and refrigeration technology. |

| • | Commercial & Residential Solutions - [removed: Providing] [added: provides] tools for professionals and homeowners, [removed: home] [added: residential] and commercial storage systems, and appliance solutions. |

Sales, earnings before interest and income taxes, and total assets attributable to each business segment for the three years ended September 30, [removed: 2013,] [added: 2014,] are set forth in Note [removed: 16] [added: 17] of Notes to Consolidated Financial Statements of the [removed: 2013] [added: 2014] Annual Report, which note is hereby incorporated by reference.

[removed: Percentage sales] [added: Sales] by segment in [removed: 2013 were] [added: 2014, as a percentage of total Emerson, were:] Process Management, [removed: 34] [added: 36] percent; Industrial Automation, [removed: 19] [added: 20] percent; Network Power, [removed: 24] [added: 20] percent; Climate Technologies, [removed: 15] [added: 16] percent; and Commercial & Residential Solutions, 8 percent.

[removed: Sales] [added: Total Emerson sales] by geographic destination in [removed: 2013 were] [added: 2014 were:] the United States and Canada, [removed: 44] [added: 46] percent; Asia, [removed: 24] [added: 22] percent; Europe, 20 percent; Latin America, 6 percent; and Middle East/Africa, 6 percent.

Information with respect to acquisition and divestiture activities and [removed: the] rationalization of operations is set forth in Notes 3 and 5 of Notes to Consolidated Financial Statements of the [removed: 2013] [added: 2014] Annual Report, which notes are hereby incorporated by reference.

The Process Management segment offers customers products and [removed: technology as well as engineering] [added: technology,] and [added: engineering,] project management [added: and consulting] services for precision measurement, control, [removed: monitoring and] [added: monitoring,] asset [removed: optimization] [added: optimization, and safety and reliability] of oil and gas reservoirs and [removed: power generating plants, or] plants that process or treat [removed: items such as oil, natural gas and petrochemicals; foods and beverages; pulp and paper; pharmaceuticals; and municipal water supplies.][added: various items.]

[removed: This] [added: The Company’s] array of products and services helps customers optimize [added: their] plant capabilities in the areas of [added: plant] safety and reliability, product quality and output efficiency.

[removed: In 2013, sales] [added: Sales] by geographic destination [added: in 2014] for Process Management [removed: were] [added: were:] the United States and Canada, [removed: 37] [added: 39] percent; Asia, [removed: 25] [added: 24] percent; Europe, [removed: 20] [added: 19] percent; Latin America, 8 percent; and Middle East/Africa, 10 percent.

[removed: Emerson’s] [added: The Company’s] process control systems can be extended wirelessly to support a mobile workforce with handheld tools/communicators, provide site-wide location tracking of people and assets, and enable video monitoring and communication with wireless field devices, thereby increasing the information available to operators.

Measurement technologies provided by [removed: Emerson] [added: the Company] include Coriolis direct mass flow, magnetic flow, vortex flow, ultrasonic flow, differential pressure, [removed: ultralow-flow] [added: ultra-low flow] fluid measurement, temperature sensors, radar-based tank gauging and magnetic level gauging.

[removed: Emerson] [added: The Company’s] measurement products are also often used in custody transfer applications, such as the transfer of [removed: crude oil] [added: gasoline] from [removed: the production field] [added: a storage tank] to a [removed: refinery,] [added: tanker truck,] where precise metering of the amount of fluid transferred helps ensure accurate asset management.

[removed: Emerson’s] [added: The Company’s] analytical technologies include process gas chromatographs, in-situ oxygen analyzers, infrared gas and process fluid analyzers, combustion analyzers and systems, and analyzers that measure pH, conductivity and water quality.

[removed: Emerson] [added: The Company] provides sensors to detect combustible and toxic gases, and flames.

These devices support the safety of [added: both] people and process plant assets.

These same technologies are also [removed: provided] [added: available] with wireless communication capability, allowing customers to monitor processes or equipment that were previously not measurable (remote, moving/rotating) or not economical to measure due to the [added: high] cost and difficulty of running wires in industrial process plants.

[removed: Emerson provides] [added: The Company designs, engineers and manufactures ball valves,] sliding stem valves, rotary valves, [added: high performance] butterfly valves and [added: severe service valves for critical applications, and] related valve actuators and controllers.

The Company [removed: also] provides a line of industrial and residential regulators, whose function is to reduce the pressure of fluids [added: moving] from high-pressure supply lines [removed: moving] into lower pressure [removed: systems.][added: systems, and also manufactures tank and terminal safety equipment, including hatches, vent pressure and vacuum relief valves, and flame arrestors for storage tanks in the oil and gas, petrochemical, refining and other process industries.]

PlantWeb digital plant architecture combines the technologies described above with the advantages of “intelligent” plant devices (valves and measurement instruments with advanced diagnostic capabilities), open communication standards (nonproprietary wired and wireless digital protocols allowing the plant devices and the [removed: plant] control system to “talk” with one another) and integrated modular [removed: software.][added: software, not only to better control the process but also to collect and analyze valuable information about those processes and the plant assets.]

This [removed: not only allows] [added: capability gives] customers [removed: to better control] the [removed: process but also to collect and analyze valuable information about plant assets and processes, thereby giving them the] ability to detect or predict changes in equipment and process performance and the associated impact on plant operations.

PlantWeb architecture provides [added: customers] the insight to improve plant availability and safety, and also furnishes a platform to continually improve asset management and standards compliance, and to reduce [removed: start-up,] [added: startup,] operating and maintenance costs.

Process Management’s array of process automation and asset optimization services [removed: can] improve automation project implementation time and costs, increase process availability and productivity, and reduce the total cost of ownership.

[added: The Company’s] Global Industry Centers offer engineering and project management services to help customers extract maximum performance and reliability from their process equipment and automation assets.

The principal worldwide distribution channel for [removed: the] Process Management [removed: segment] is [added: a] direct sales [removed: forces,] [added: force,] although a network of independent sales representatives, and to a lesser [removed: extent,] [added: extent] independent distributors purchasing [removed: these] products for [removed: resale] [added: resale,] are also utilized.

Approximately half of [added: the] sales in the United States are made through a direct sales force with the remainder primarily through independent sales representatives.

Service/trademarks and trade names within [removed: the] Process Management [removed: segment] include Emerson Process Management, AMS Suite, Baumann, Bettis, Bristol, CSI, Damcos, Daniel, DeltaV, EIM, El-O-Matic, Fisher, Go Switch, Guardian, Micro Motion, Net Safety, Ovation, PlantWeb, ROC, Rosemount, Roxar, Smart Process, SureService, Tescom, TopWorx and Valvetop.

The Industrial Automation segment provides integrated manufacturing solutions to [added: its] customers at the source of manufacturing their own products.

Products include motors, drives, power generating alternators, [removed: power transmission solutions,] fluid [removed: controls and] [added: controls, electrical distribution devices,] materials joining [removed: equipment.][added: equipment and power transmission solutions.]

Through these offerings, the Company brings technology and enhanced quality to [removed: the customer’s] [added: its customers'] final [removed: product.][added: products.]

[removed: In 2013, sales] [added: Sales] by geographic destination [added: in 2014] for this segment [removed: were] [added: were:] the United States and Canada, [removed: 41] [added: 83] percent; Asia, [removed: 17] [added: 4] percent; Europe, [removed: 35] [added: 8] percent; Latin America, 3 percent; and Middle East/Africa, [removed: 4] [added: 2] percent.

Industrial Automation provides a broad line of drives and [removed: electronic] [added: electric] motors that are used in a wide variety of manufacturing operations and [removed: products] [added: products,] including production assembly lines, [removed: elevators, escalators, and are the prime movers] [added: escalators] in [removed: rotating equipment such as fans, pumps] [added: shopping malls] and [removed: compressors.][added: supermarket checkout stations.]

Products in this category include alternating current (AC) and direct current (DC) [added: electrical] variable speed [removed: electrical drives and motors,] [added: drives,] servo [removed: drives and] motors, [added: pump motors,] drive control systems, integral horsepower motors (1 HP and above), fractional horsepower motors (less than 1 HP), hermetic [removed: motors,] [added: motors] and gear drives.

Power generation [removed: includes] [added: products include] low, medium and high voltage alternators for use in [removed: diesel-] [added: diesel] and [removed: gas-powered] [added: gas powered] generator sets, as well as high frequency alternators, AC motor/generator sets, traction generators, wind power generators, wind turbine pitch control systems and solar photovoltaic converters.

They are used to transmit power mechanically, provide anti-friction support or to enable automated [removed: material] [added: materials] handling in a wide variety of industrial and commercial applications.

[removed: Our product designs] [added: Product design] and application experience enable [removed: us] [added: the Company] to provide both standard and customized automation and power transmission solutions to [removed: our] [added: its] customers.

Fluid Power and [removed: Fluid] Control

Emerson (“the Company”) was incorporated in Missouri in 1890, and has evolved through internal growth and strategic acquisitions from a regional manufacturer of electric motors and fans into a diversified global leader in bringing technology and engineering together to provide innovative solutions for customers in a wide range of industrial, commercial and consumer markets around the world.

Significant end markets served include oil and gas, refining, chemicals and power generation, as well as pharmaceuticals, food and beverages, pulp and paper, metals and mining, and municipal water supplies.

Valves, Actuators and Regulators

Engineered on/off valves are typically used to achieve tight shutoff, even in high pressure and temperature processes.

Reliability consulting services help process plant owners and operators improve plant availability through implementation of on-site and corporate-wide reliability programs.

Through proven project methodologies and deep knowledge of plant assets, the Company helps industrial plants to improve safety, increase plant uptime and reduce maintenance costs.

Electrical distribution consists of a broad line of components for current- and noncurrent-carrying electrical distribution devices, including conduit and cable fittings, plugs and other receptacles, industrial lighting, enclosures and controls.

Thermal Management

Thermal management equipment provides efficient, reliable and cost effective management of heat in mission- critical facilities.

Applications include data center and telecom sites ranging from small network closets, to computer rooms, to hyperscale sized facilities.

Additionally, the thermal management portfolio spans a variety of offerings, including chilled water, direct expansion and evaporative equipment, software, and controls.

Products include reciprocating, scroll and screw

Appliance Solutions

Approximately one-third of this segment's sales are made to a small number of big box retailers.

| | 2013 | | | | 2014 | |

| Industrial Automation | 597 | | | | 646 | |

| Climate Technologies | 351 | | | | 452 | |

| Total Backlog | $ | 6,289 | | | 6,714 | |

Emerson was incorporated in Missouri in 1890, and has grown from a regional manufacturer of electric motors and fans into a diversified global technology company.

Having expanded its product lines through internal growth and acquisitions, Emerson today designs and supplies products and technology, and delivers engineering services and solutions around the world in a wide range of industrial, commercial and consumer markets.

Final Control

Emerson’s majority-owned EGS Electrical Group joint venture with SPX Corporation manufactures a broad line of components for current- and noncurrent-carrying electrical distribution devices.

These products include conduit and cable fittings, plugs and receptacles, industrial lighting, enclosures and controls.

Precision Cooling

Precision cooling products provide temperature and humidity control for computers, telecommunications and other sensitive equipment.

Embedded Computing and Power

Embedded computing designs and develops embedded computer systems for original equipment manufacturers and systems integrators serving telecommunications, defense, aerospace, medical and industrial automation end markets.

Products range from communication platforms, blades and modules to enabling software and professional services.

Embedded power supplies are installed by original equipment manufacturers to convert or condition power for microprocessors and peripherals in a wide range of telecommunication, health care, computer and industrial applications using standard or custom AC/DC or DC/DC designs.

They are also used in consumer products for chargers and power adaptors.

The Company has entered into an agreement to sell a controlling interest in this business.

Connectivity Solutions

Connectivity products serve the needs of the wireless communications, telephone and data network, CATV, defense, security systems and health care industries and other industrial customers with a broad range of radio frequency, microwave and fiber optic interconnect components and assemblies.

This equipment includes polymer and wire storage systems, busing carts, pan and tray racks, transport carts and workstations.

Appliances and Components

| | 2012 | | | | 2013 | |

| Industrial Automation | 536 | | | | 523 | |

| Climate Technologies | 317 | | | | 323 | |

| Total Backlog | $ | 6,254 | | | 6,187 | |

None of these agreements is considered significant.

See Note 16 of Notes to Consolidated Financial Statements of the 2013 Annual Report, which note is hereby incorporated by reference, for further information with respect to non-U.S. operations.

It is not possible to predict the outcome of these matters, but historically the Company has been [added: largely] successful in both prosecuting and defending claims and lawsuits.

The information regarding legal proceedings set forth in Note 12 of Notes to Consolidated Financial Statements of the [removed: 2013] [added: 2014] Annual Report is hereby incorporated by reference.

10-K 1 [removed: emr930201310-k.htm] [added: emr930201410-k.htm] FORM 10-K

For the fiscal year ended September 30, [removed: 2013][added: 2014]

Aggregate market value of the voting stock held by nonaffiliates of the registrant as of close of business on March 31, [removed: 2013: $40.1] [added: 2014: $46.6] billion.

| 1. | Portions of Emerson Electric Co. [removed: 2013] [added: 2014] Annual Report to Stockholders for the year ended September 30, [removed: 2013] [added: 2014] incorporated by reference into Parts I and II hereof. |

| 2. | Portions of Emerson Electric Co. Notice of [removed: 2014] [added: 2015] Annual Meeting of Stockholders and Proxy Statement incorporated by reference into Part III hereof. |

Common stock outstanding at October 31, 2014: 693,634,810 shares.

Common stock outstanding at October 31, 2013: 703,964,498 shares.

At September 30, [removed: 2013,] [added: 2014,] Emerson had approximately [removed: 230] [added: 220] manufacturing locations worldwide, of which approximately [removed: 155] [added: 150] were located outside the United States, primarily in Europe and Asia, and to a lesser extent in Canada and Latin America.

Manufacturing locations by business segment are: Process Management, [removed: 60;] [added: 70;] Industrial Automation, [removed: 70;] [added: 69;] Network Power, [removed: 45;] [added: 28;] Climate Technologies, [removed: 35;] [added: 36;] and Commercial & Residential Solutions, [removed: 20.][added: 17.]

The following sets forth certain information as of November 19, [removed: 2013] [added: 2014] with respect to Emerson's executive officers.

These officers have been elected or appointed to terms which expire February [removed: 4, 2014:][added: 3, 2015:]

| D. N. Farr | Chairman of the Board and Chief Executive Officer* | [removed: 58] [added: 59] | 1985 |

| F. J. Dellaquila | Executive Vice President and Chief Financial Officer | [removed: 56] [added: 57] | 1991 |

| E. L. Monser | President and Chief Operating Officer | [removed: 63] [added: 64] | 2002 |

| C. A. Peters | Senior Executive Vice President | [removed: 58] [added: 59] | 1990 |

| R. J. Schlueter | Vice President, Controller and Chief Accounting Officer | [removed: 59] [added: 60] | 1992 |

| F. L. Steeves | Executive Vice President, Secretary and General Counsel | [removed: 59] [added: 60] | 2007 |

| S. J. Pelch | Vice President - Organization Planning and Development | 50 | 2005 |

| | | | |

Steven J.

Pelch was appointed Vice President - Organization Planning and Development in November 2014.

Prior to his current position, Mr. Pelch was Vice President - Organization Planning from October 2012 to November 2014 and Vice President - Planning from October 2005 to October 2012.

He was appointed Senior Vice President, Secretary and General Counsel in March 2007.

He was appointed Senior Vice President, Secretary and General Counsel in March 2007, prior to which he was Vice Chairman of the Milwaukee-based law firm of von Briesen & Roper, S.C., which has provided legal services to the Company since 2001.

Mr. Steeves joined von Briesen and Roper as a partner in 2001, and became Vice Chairman of that firm in 2004.

Craig W.

Ashmore, former Executive Vice President - Planning and Development, resigned from the Company effective November 11, 2013.

Information regarding the market for the Company's common stock, quarterly market price ranges and dividend payments is set forth in Note [removed: 18] [added: 19] of Notes to Consolidated Financial Statements of the [removed: 2013] [added: 2014] Annual Report, which note is hereby incorporated by reference.

There were approximately [removed: 21,898] [added: 20,901] stockholders of record at September 30, [removed: 2013.][added: 2014.]

The Company’s Board of Directors authorized the [removed: repurchase] [added: purchase] of up to [removed: 80] [added: 70] million shares [added: of common stock] under a May [removed: 2008 program, and approved a new program on May 7,] 2013 [removed: for the repurchase of up to 70 million additional shares.][added: program.]

| July 2014 | | 1,320 | | | $67.03 | | 1,320 | | | 51,994 | |

| August 2014 | | 1,440 | | | $63.48 | | 1,440 | | | 50,494 | |

| September 2014 | | 1,365 | | | $64.13 | | 1,365 | | | 49,129 | |

| Total | | 4,125 | | | $64.83 | | 4,125 | | | 49,129 | |

| July 2013 | | 1,540 | | | $57.65 | | 1,540 | | | 72,445 | |

| August 2013 | | 3,910 | | | $61.56 | | 3,910 | | | 68,535 | |

| September 2013 | | 4,602 | | | $63.85 | | 4,602 | | | 63,933 | |

| Total | | 10,052 | | | $62.01 | | 10,052 | | | 63,933 | |

No shares remain available under the 2008 program.

| | [removed: 2009 | | | |] 2010 | | | 2011 | | | 2012 (a) | | | 2013 (a) | | [added: | 2014 (a) | |]

| Net sales | [removed: $ | 20,102 | | |] 21,039 | | | 24,222 | | | 24,412 | | | 24,669 | | [added: | 24,537 | |]

| Earnings from continuing operations – common stockholders | [removed: $ | 1,715 | | |] 1,978 | | | 2,454 | | | 1,968 | | | 2,004 | | [added: | 2,147 | |]

| Basic earnings per common share from continuing operations | [removed: $ | 2.27 | | |] 2.62 | | | 3.26 | | | 2.68 | | | 2.78 | | [added: | 3.05 | |]

| Diluted earnings per common share from continuing operations | [removed: $ | 2.26 | | |] 2.60 | | | 3.24 | | | 2.67 | | | 2.76 | | [added: | 3.03 | |]

| Cash dividends per common share | [removed: $ | 1.32 | | |] 1.34 | | | 1.38 | | | 1.60 | | | 1.64 | | [added: | 1.72 | |]

| Long-term debt | [removed: $ | 3,998 | | |] 4,586 | | | 4,324 | | | 3,787 | | | 4,055 | | [added: | 3,559 | |]

| Total assets | [removed: $ | 19,763 | | |] 22,843 | | | 23,861 | | | 23,818 | | | 24,711 | | [added: | 24,177 | |]

(a) [removed: 2013 includes $566 million after-tax ($0.78 per share)] [added: Includes] goodwill impairment and income tax [removed: charges;][added: charges as follows: 2014, $508 million and $0.72 per share; 2013, $566 million and $0.78 per share; 2012, $528 million and $0.72 per share.]

See Note 3 of Notes to Consolidated Financial Statements of the [removed: 2013] [added: 2014] Annual Report, which note is hereby incorporated by reference, for information regarding the Company's acquisition and divestiture activities for the last three years.

The divested U.S. Motors [removed: business] [added: business,] with annual sales of approximately $820 [removed: million] [added: million,] was classified as discontinued operations in [removed: 2009 and] 2010.

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2012 includes a $528 million after-tax ($0.72 per share) goodwill impairment charge.

The consolidated financial statements and accompanying notes of the Company and subsidiaries and the report thereon of KPMG LLP in the [removed: 2013] [added: 2014] Annual Report, are hereby incorporated by reference.

Based on an evaluation performed, the Company's certifying officers have concluded that the disclosure controls and procedures were effective as of September 30, [removed: 2013] [added: 2014] to provide reasonable assurance of achieving these objectives.

There was no change in the Company's internal control over financial reporting during the quarter ended September 30, [removed: 2013,] [added: 2014,] that has materially affected, or is reasonably likely to materially affect, the Company's internal control over financial reporting.

Management’s report on internal control over financial reporting, and the related report of the Company’s auditor, KPMG LLP, an independent registered public accounting firm, appearing in the [removed: 2013] [added: 2014] Annual Report are hereby incorporated by reference.

Information regarding nominees and directors appearing under "Nominees and Continuing Directors" in the Emerson Electric Co. Notice of Annual Meeting of Stockholders and Proxy Statement for the February [removed: 2014] [added: 2015] annual stockholders' meeting (the [removed: "2014] [added: "2015] Proxy Statement") is hereby incorporated by reference.

Information appearing under "Section 16(a) Beneficial Ownership Reporting Compliance" in the [removed: 2014] [added: 2015] Proxy Statement is hereby incorporated by reference.

[added: Information] regarding the Audit Committee and Audit Committee Financial Expert appearing under "Board of Directors and Committees" in the [removed: 2014] [added: 2015] Proxy Statement is hereby incorporated by reference.

Emerson has adopted Charters for its Audit Committee, Compensation Committee, and Corporate Governance and Nominating Committee and a Code of Business Ethics for directors, officers and employees, which are available on its Internet website and in print to any [removed: shareholder] [added: stockholder] who requests them.

Emerson has also adopted Corporate Governance Principles and Practices, which are available on its Internet website and in print to any [removed: shareholder] [added: stockholder] who requests them.

Information

Information appearing under “Board of Directors and Committees—Compensation Committee,” “Board of Directors and Committees—Corporate Governance and Nominating Committee,” “Director Compensation,” “Executive Compensation” (including, but not limited to, the information set forth under “Compensation Discussion and Analysis,” “Compensation Committee Report” and “Summary Compensation Table”) and “Compensation Committee Interlocks and Insider Participation” in the [removed: 2014] [added: 2015] Proxy Statement is hereby incorporated by reference.

The information regarding beneficial ownership of shares by nominees and continuing directors, named executive officers, [removed: 5%] [added: five percent] beneficial owners, and by all directors and executive officers as a group appearing [removed: under] [added: under,] "Stock Ownership of Directors, Executive Officers and 5% Beneficial Owners" in the [removed: 2014] [added: 2015] Proxy [removed: Statement] [added: Statement,] is hereby incorporated by reference.

Information regarding stock option plans and incentive shares plans set forth in Note 14 of Notes to Consolidated Financial Statements of the [removed: 2013] [added: 2014] Annual Report is hereby incorporated by reference.

Information regarding the Company’s equity compensation plans as of September 30, 2014, appearing under "Equity Compensation Plan Information" in the 2015 Proxy Statement, is hereby incorporated by reference.

The following table sets forth aggregate information regarding the Company’s equity compensation plans as of September 30, 2013:

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| | Number of Securities to be Issued upon Exercise of Outstanding Options, Warrants and Rights | | Weighted-Average Exercise Price of Outstanding Options, Warrants and Rights | | Number of Securities Remaining Available for Future Issuance under Equity Compensation Plans (Excluding Securities Reflected in Column (a)) |

| Plan Category | (a) | | (b) | | (c) |

| Equity compensation plans approved by security holders (1) | 21,653,946 | | $47.03 | | 24,431,516 |

| Equity compensation plans not approved by security holders | — | | — | | — |

| Total | 21,653,946 | | $47.03 | | 24,431,516 |

| | |

| --- | --- |

| (1) | Includes the Stock Option and Incentive Shares Plans previously approved by the Company's security holders. Included in column (a) are 5,118,500 shares reserved for performance shares awards (awarded in 2013), which will be distributed primarily in shares of common stock and partially in cash contingent upon the Company achieving the financial performance objectives through 2016 and continued service by the employee. Also included in column (a) are 4,837,739 shares reserved for performance shares awards (awarded primarily in 2010), 2,902,647 of which were issued primarily in shares of common stock and paid partially in cash in early fiscal 2014 as a result of achieving the financial objective at a 93 percent performance level by the end of fiscal 2013, and 1,935,092 shares which will be distributed in shares of common stock contingent upon one additional |

year of service by employees, and the remainder of which have been earned under prior performance shares programs but for which participants elected to defer payment.

As provided by the Company’s Incentive Shares Plans, performance shares awards represent a commitment to issue such shares without cash payment by the employee, contingent upon achievement of the objective and continued service by the employee.

The price in column (b) represents the weighted-average exercise price for outstanding options.

Included in column (c) are 5,038,410 shares remaining available for award under the previously approved 2006 Incentive Shares Plan and 269,750 shares remaining available under the previously approved Restricted Stock Plan for Non-Management Directors.

Information appearing under “Director Independence” in the [removed: 2014] [added: 2015] Proxy Statement is hereby incorporated by reference.

Information appearing under "Fees Paid to KPMG LLP" in the [removed: 2014] [added: 2015] Proxy Statement is hereby incorporated by reference.

| 1. | The consolidated financial statements and accompanying notes of the Company and subsidiaries and the report thereon of KPMG LLP in the [removed: 2013] [added: 2014] Annual Report. |

| 2. | Financial Statement Schedules [removed: —] [added: -] All schedules are omitted because they are not required, not applicable or the required information is provided in the financial statements or notes thereto contained in the [removed: 2013] [added: 2014] Annual Report. |

| 3(b) | Bylaws of Emerson Electric Co., as amended through November [removed: 5, 2013,] [added: 4, 2014,] incorporated by reference to Emerson Electric Co. Form 8-K filed November [removed: 12, 2013,] [added: 5, 2014,] Exhibit 3.1. |

| 4(a) | Indenture dated as of [removed: April 17, 1991,] [added: December 10, 1998,] between Emerson Electric Co. and The [removed: Boatmen's National] Bank of [removed: St. Louis,] [added: New York,] Trustee, incorporated by reference to Emerson Electric Co. [removed: Registration Statement on] [added: 1998] Form [removed: S-3,] [added: 10-K,] File No. [removed: 33-62545,] [added: 1-278,] Exhibit [removed: 4.1.] [added: 4(b).] |

| 10(q) | [removed: Long-Term] Credit Agreement dated as of [removed: December 16, 2010,] [added: April 30, 2014,] incorporated by reference to Emerson Electric Co. Form 8-K filed [removed: December 17, 2010,] [added: May 2, 2014,] Exhibit 10.1. |

| 13 | Portions of Emerson Electric Co. Annual Report to Stockholders for the year ended September 30, [removed: 2013,] [added: 2014,] incorporated by reference herein |

| 101 | Attached as Exhibit 101 to this report are the following documents formatted in XBRL (Extensible Business Reporting Language): (i) Consolidated Statements of Earnings for the years ended September 30, [removed: 2011, 2012] [added: 2012, 2013] and [removed: 2013,] [added: 2014,] (ii) Consolidated Statements of Comprehensive Income for the years ended September 30, [removed: 2011,] 2012, [added: 2013,] and [removed: 2013] [added: 2014] (iii) Consolidated Balance Sheets at September 30, [removed: 2012] [added: 2013] and [removed: 2013,] [added: 2014,] (iv) Consolidated Statements of Equity for the years ended September 30, [removed: 2011, 2012] [added: 2012, 2013] and [removed: 2013,] [added: 2014,] (v) Consolidated Statements of Cash Flows for the years ended September 30, [removed: 2011, 2012] [added: 2012, 2013] and [removed: 2013,] [added: 2014,] and (vi) Notes to Consolidated Financial Statements for the year ended September 30, [removed: 2013.] [added: 2014.] |

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below on November 19, [removed: 2013,] [added: 2014,] by the following persons on behalf of the registrant and in the capacities indicated.

| 13 | | | Portions of Emerson Electric Co. Annual Report to Stockholders for the year ended September 30, [removed: 2013,] [added: 2014,] incorporated by reference herein |

| 101 | | | Attached as Exhibit 101 to this report are the following documents formatted in XBRL (Extensible Business Reporting Language): (i) Consolidated Statements of Earnings for the years ended September 30, [removed: 2011, 2012] [added: 2012, 2013] and [removed: 2013,] [added: 2014,] (ii) Consolidated Statements of Comprehensive Income for the years ended September 30, [removed: 2011, 2012] [added: 2012, 2013] and [removed: 2013,] [added: 2014,] (iii) Consolidated Balance Sheets at September 30, [removed: 2012] [added: 2013] and [removed: 2013,] [added: 2014,] (iv) Consolidated Statements of Equity for the years ended September 30, [removed: 2011, 2012] [added: 2012, 2013] and [removed: 2013,] [added: 2014,] (v) Consolidated Statements of Cash Flows for the years ended September 30, [removed: 2011, 2012] [added: 2012, 2013] and [removed: 2013,] [added: 2014,] and (vi) Notes to Consolidated Financial Statements for the year ended September 30, [removed: 2013.] [added: 2014.] |

| 10(u)* | Letter Agreement effective as of November 11, 2013 by and between Emerson Electric Co. and Craig W. Ashmore, incorporated by reference to Emerson Electric Co. Form 8-K filed February 5, 2014, Exhibit 10.1. |

| | | November 19, 2014 | |

| C. Kendle | | |

| | | |

| * | | Director |

| 4(b) | Indenture dated as of December 10, 1998, between Emerson Electric Co. and The Bank of New York, Trustee, incorporated by reference to Emerson Electric Co. 1998 Form 10-K, File No. 1-278, Exhibit 4(b). |

| | | November 19, 2013 | |