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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

McKesson Corporation Profit-Sharing Investment Plan
San Francisco, California

We have audited the accompanying statements of net assets available for benefits of the McKesson Corporation Profit-Sharing Investment Plan (the “Plan”) as of March 31, 2007 and 2006, and the related statements of changes in net assets available for benefits for the years then ended. These financial statements are the responsibility of the Plan’s management. Our responsibility is to express an opinion on these statements based on our audits.

We conducted our audits in accordance with standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The Plan is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Plan’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes 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, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, such financial statements present fairly, in all material respects, the net assets available for benefits of the Plan as of March 31, 2007 and 2006, and the changes in net assets available for benefits for the years then ended in conformity with accounting principles generally accepted in the United States of America.

As discussed in Note 2 to the financial statements, as of March 31, 2007, the Plan adopted Financial Accounting Standards Board Staff Position, FSP AAG INV-1 and Statement of Position 94-4-1, Reporting of Fully Benefit-Responsive Investment Contracts Held by Certain Investment Companies Subject to the AICPA Investment Company Guide and Defined-Contribution Health and Welfare and Pension Plans.

Our audits were conducted for the purpose of forming an opinion on the basic financial statements taken as a whole. The supplemental schedule listed in the Table of Contents is presented for the purpose of additional analysis and is not a required part of the basic financial statements, but is supplementary information required by the Department of Labor’s Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974. This schedule is the responsibility of the Plan’s management. Such schedule has been subjected to the auditing procedures applied in our audit of the basic 2007 financial statements and, in our opinion, is fairly stated in all material respects when considered in relation to the basic financial statements taken as a whole.

Deloitte & Touche LLP
San Francisco, California
September 25, 2007

McKESSON CORPORATION PROFIT-SHARING INVESTMENT PLAN

STATEMENTS OF NET ASSETS AVAILABLE FOR BENEFITS
MARCH 31, 2007 AND 2006 (IN THOUSANDS)


	2007						2006
	Participant		Non-Participant				Participant		Non-Participant
	Directed		Directed		Plan Total		Directed		Directed		Plan Total
ASSETS:
Cash and cash equivalents:
Allocated	$		$	3,145	$	3,145	$		$	2,997	$	2,997
Unallocated				66		66				117		117

Total cash & cash equivalents		—		3,211		3,211		—		3,114		3,114


Investments at Fair Value:
Mutual funds and brokerage link		679,403				679,403		550,418				550,418
Common/ collective trusts		238,177				238,177		220,347				220,347
Separately managed accounts		184,849				184,849		162,652				162,652
Standish Mellon Stable Value Fund		110,128				110,128		111,338				111,338
Participant loans		21,023				21,023		19,786				19,786
McKesson Corp common stock:
Allocated				447,214		447,214				437,711		437,711
Unallocated				59,918		59,918				95,754		95,754
Employee stock fund		55,024				55,024		53,253				53,253

Total Investments at Fair Value		1,288,604		507,132		1,795,736		1,117,794		533,465		1,651,259


Receivables:
Dividends and interest on:
Allocated				470		470				511		511
Unallocated				70		70				121		121
Due from broker for securities sold —allocated				—		—				132		132

Total receivables		—		540		540		—		764		764

Total assets		1,288,604		510,883		1,799,487		1,117,794		537,343		1,655,137


LIABILITIES:
Line of credit — on unallocated stock				3,000		3,000				3,600		3,600
ESOP promissory notes payable — on unallocated stock				11,353		11,353				20,983		20,983
Accrued interest - unallocated stock				490		490				909		909
Accrued other				629		629				1,052		1,052

Total liabilities		—		15,472		15,472		—		26,544		26,544

NET ASSETS Available for Benefits at Fair Value		1,288,604		495,411		1,784,015		1,117,794		510,799		1,628,593
ADJUSTMENT from fair value to contract value for fully benefit-responsive investment contracts		914				914		2,264				2,264

NET ASSETS Available for Benefits	$	1,289,518	$	495,411	$	1,784,929	$	1,120,058	$	510,799	$	1,630,857

See notes to financial statements.

McKESSON CORPORATION PROFIT-SHARING INVESTMENT PLAN

STATEMENTS OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS
YEARS ENDED MARCH 31, 2007 AND 2006 (IN THOUSANDS)


	2007							2006
	Participant		Non-Participant					Participant		Non-Participant
	Directed		Directed			Plan Total		Directed		Directed			Plan Total
INVESTMENT INCOME:
Net appreciation in fair value of investments	$	48,413	$	54,022		$	102,435	$	106,303	$	156,742		$	263,045
Dividends and interest		61,197		2,977			64,174		32,589		3,284			35,873

Investment income		109,610		56,999			166,609		138,892		160,026			298,918


CONTRIBUTIONS:
Participants		105,059					105,059		96,508					96,508
Employer				12,036			12,036				14,261			14,261
ERISA litigation settlement proceeds		13,981					13,981		13,654					13,654

Total contributions		119,040		12,036			131,076		110,162		14,261			124,423


DEDUCTIONS:
Benefits paid to participants		120,440		34,905			155,345		83,254		26,923			110,177
Interest expense				1,348			1,348				2,850			2,850
Administrative fees		1,082		80			1,162		1,011					1,011

Total deductions		121,522		36,333			157,855		84,265		29,773			114,038


INCREASE IN NET ASSETS BEFORE INTERFUND TRANSFERS AND MERGERS		107,128		32,702			139,830		164,789		144,514			309,303
INTERFUND TRANSFERS		48,090		(48,090	)		—		40,144		(40,144	)		—
TRANSFER OF NET ASSETS FROM OTHER PLAN		14,242					14,242							—

INCREASE (DECREASE) IN NET ASSETS		169,460		(15,388	)		154,072		204,933		104,370			309,303
Net assets at beginning of year		1,120,058		510,799			1,630,857		915,125		406,429			1,321,554

Net assets at end of year	$	1,289,518	$	495,411		$	1,784,929	$	1,120,058	$	510,799		$	1,630,857

See notes to financial statements.

McKESSON CORPORATION PROFIT-SHARING INVESTMENT PLAN

NOTES TO FINANCIAL STATEMENTS
YEARS ENDED MARCH 31, 2007 AND 2006

1. PLAN DESCRIPTION

The following brief description of the McKesson Corporation Profit-Sharing Investment Plan (the “PSIP” or the “Plan”) is provided for general information purposes only. Participants should refer to the Plan document for more complete information. The PSIP is a defined contribution plan covering all persons who have completed two months of service and are regular or part-time employees, or are casual employees who have completed a year of service in which they worked at least 1,000 hours in a year, at McKesson Corporation (the “Company” or “McKesson”) or a participating subsidiary, except employees covered by a collectively bargained pension plan. The Plan is subject to the provisions of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”).

Fidelity Management Trust Company (“Fidelity”) is the trustee of the Plan.

The Plan is comprised of Participant Directed and Non-Participant Directed Investments, as described below:

A Participant Directed Investments

Contributions — In fiscal 2006, certain Plan provisions were amended to enable the Plan to qualify as a safe harbor plan as described in Internal Revenue Code sections 401(k) (12) and 401(m) (11). Participants may make pretax contributions from 1% to 20% of eligible pay, limited to $15,500 for calendar year 2007 and $15,000 for calendar year 2006. Total contributions are limited to the lesser of $45,000 for calendar year 2007 ($44,000 for calendar year 2006) or 100% of taxable compensation per calendar year. Participants 50 years of age or older may also elect to make pretax catch-up contributions of up to 67% of pay, limited to $5,000 for calendar year 2007 and calendar year 2006. Participants may also contribute amounts representing distributions from other qualified plans.

Participant Accounts — Individual accounts are maintained for each Plan participant. Each participant’s account is credited with the participant’s contribution and an allocation of earnings, and charged with withdrawals and an allocation of losses and administrative expenses. Allocations are based on participant earnings, or account balances, as defined in the Plan document. The participant is entitled to a benefit upon retirement or separation from employment based upon the vested portion of the participant’s account.

Vesting — Participant contributions and earnings thereon are 100% vested at all times.

Investment Options — Upon enrollment in the PSIP, a participant may direct contributions in 1% increments to any of the investments within the Plan. The following are descriptions from each fund’s prospectus or fund manager’s report:

•		McKesson Corporation Employee Company Stock Fund (the “Employee Stock Fund”) represents shares invested in Company common stock with participant contributions and transfers from the Employer Company Stock Allocated Fund.

•		Brokerage Link provides access to a discount brokerage account which allows participants to develop a self-directed brokerage option. Commissions and transaction fees are charged to the participant’s account. Effective January 1, 2005, Fidelity waived the account maintenance fees.

•		SSgA Bond Index Fund is a commingled pool that seeks to provide investment results that correspond to the total return of the bonds in the Lehman Brothers Aggregate Bond Index.

•		SSgA Balanced Fund is a custom mix of commingled pools that invests 60% in SSgA S&P 500 Index Fund and 40% in SSgA Bond Index Fund.

•		Wellington Management Small Cap Portfolio invests in stocks within the market capitalization range of the Russell 2000 Index. This is a separately managed account, not a mutual fund, which seeks long-term growth by investing in the stocks of small companies.

•		SSgA S&P 500 Index Fund is a commingled pool that invests in stocks in the benchmark S&P 500 Index and attempts to duplicate the investment results of that index.

McKESSON CORPORATION PROFIT-SHARING INVESTMENT PLAN

NOTES TO FINANCIAL STATEMENTS (CONTINUED)
YEARS ENDED MARCH 31, 2007 AND 2006

•		Dodge & Cox Large Cap Value Fund invests in the common stock of companies when the fund managers believe the long-term earnings prospects are not reflected in the current price. This is a separately managed account, not a mutual fund.

•		Standish Mellon Stable Value Fund invests in fixed-income investments issued by life insurance companies and financial institutions. This is a separately managed account, not a mutual fund.

•		Fidelity Diversified International Fund invests primarily in a diversified portfolio of equity securities of companies located outside of the United States.

•		MFS Institutional Large Cap Growth Fund invests primarily in common stocks, with a goal of long-term capital growth. MFS discontinued this fund in December 2006, and it was replaced in the PSIP with the Rainier Large Cap Growth Portfolio on December 21, 2006.

•		Rainier Large Cap Growth Portfolio invests primarily in the common stock of large companies, with a goal of long-term capital growth. This is a separately managed account, not a mutual fund, and was added to the PSIP on December 21, 2006.

•		Mutual Fund Window provides access to approximately 260 mutual fund options from more than 20 investment companies.

In April 2006, changes to plan investment options were made. The Plan’s Mutual Fund Window offering was updated to mirror Fidelity’s Mutual Fund Window offering. Furthermore, Fidelity Magellan Fund was moved out of the core investment options group and into the Mutual Fund Window.

Loans — Participants may apply for a loan from the Plan. The total amount owed to the Plan by an individual participant cannot exceed the lowest of 50% of such participant’s vested account balance, $50,000 as adjusted for certain items specified in the Plan document, or the value of the participant’s account attributable to basic, supplemental, catch-up and rollover contributions. Loans bear interest at the then current prime rate of interest at the loan date plus 1%. Contractual interest rates ranged from 5% to 11% in fiscal 2007 and 2006. Loans may be repaid over a period not to exceed 5 years, except for residential loans, which must not exceed a term of 10 years. Principal repayments and interest are paid through payroll deductions. For participants who have been terminated or are on leave and are no longer receiving a paycheck, loan repayments may be made via monthly coupon payments. Participant loans totaled $21,023,000 and $19,786,000 at March 31, 2007 and 2006.

Payment of Benefits — Participants have the right to receive a total distribution of the value of their vested accounts from the PSIP at the time of retirement, death, disability or termination of employment. In general, benefit payments are made in a lump sum cash amount, but participants also may elect a distribution in the form of installments. Former employees may remain participants in the Plan.

Transfers from Other Qualified Plan — In July 2006, the net assets from the D&K Healthcare Resources, Inc. Profit Sharing Plan and Trust totaling $14,242,000 were merged into the Plan.

B Non-Participant Directed Investments

General — The McKesson Corporation Employer Company Stock Funds (Allocated and Unallocated) (the “Employer Stock Funds”) consist of a leveraged Employee Stock Ownership Plan (“ESOP”). Generally the Allocated fund represents shares that have been allocated to participants through employer contributions and have not been directed to other investment options by the participants. This fund is classified as “non-participant directed” because only the Company can direct shares into this account. The Unallocated fund represents ESOP shares to be used for the future employer contributions. Participants can transfer matching company contributions from the allocated fund to other participant directed investments, including the Employee Stock Fund, as soon as they are made. Total transfers to the participant directed investments for the years ended March 31, 2007 and 2006 were $48,090,000 and $40,144,000. In fiscal year 2007, employer contributions were funded with 839,000 shares from the ESOP. In fiscal 2006, employer contributions were funded with 908,000 shares from the ESOP.

McKESSON CORPORATION PROFIT-SHARING INVESTMENT PLAN

NOTES TO FINANCIAL STATEMENTS (CONTINUED)
YEARS ENDED MARCH 31, 2007 AND 2006

Employer Matching Contributions to Participants Accounts — Effective the last business day of each month throughout the fiscal year, participant accounts are credited with matching Company contributions, in the form of the Company’s common stock based on a percentage of the participants’ basic contributions. Effective April 1, 2005, the Plan provides for Company matching contributions to all participants who make elective deferrals in an amount equal to 100% of the employee’s deferral for the first 3% of pay deferred, and 50% of the employee’s deferral for the next 2% of pay deferred. An additional annual matching contribution may be granted at the discretion of the Company to plan participants; however, there was no additional match allocated for the fiscal year ended March 31, 2007. For the fiscal year ended March 31, 2006, an additional match of $0.037 for every dollar contributed, up to the first 5% of pay contributed, was allocated to eligible plan participants.

The Internal Revenue Code requires that shares be released for employer contributions according to a formula based on debt service payments under the leveraged ESOP component of the Plan. In fiscal 2007, the Company identified certain errors in calculating the number of shares to be released which resulted in an over release for fiscal 2006. To correct this error, the Company contributed 26,000 additional shares to the Plan in fiscal 2007.

Employer Contributions — Dividends on unallocated shares of Company common stock are used to pay the obligations under the ESOP loans. Under the terms of the loan agreements, the Company is required to make cash contributions to the extent that the dividends are not sufficient to service the debt. To pay down such debt obligations, cash contributions amounted to $11,552,000 and $14,261,000 in the years ended March 31, 2007 and 2006. In addition, the Company contributed $484,000 in share contributions to correct the 26,000 share over release in fiscal 2006.

Vesting — Employer contributions made on or after April 1, 2005, are 100% vested immediately. Employer contributions made before April 1, 2005 vest ratably over five years of service (20% vests each year over five years). Generally, for employer contributions made before April 1, 2005, 100% vesting is provided upon retirement, disability, death, termination of the Plan, or a substantial reduction in work force initiated by the Company for affected participants. Dividends automatically reinvested in McKesson common stock on and after January 1, 2003 are also 100% vested at all times.

Forfeitures — A rehired employee who has met certain levels of service prior to termination may be entitled to have forfeited interests in the PSIP reinstated. Each fiscal year, forfeited interests are used to reinstate previously forfeited amounts of rehired employees and to pay other Plan expenses as appropriate. Forfeitures for the years ended March 31, 2007 and 2006 of employer contributions made before April 1, 2005 were $1,028,000 and $1,272,000.

Diversification of Stock Fund — Participants may transfer Company contributions to other investment funds as soon as they are made. In addition, participants may diversify past vested Company contributions without restrictions.

Payment of Benefits — Distributions are made only upon participant retirement, death (in which case, payment shall be made to the participant’s beneficiary), or other termination of employment with the Company. Distributions are made in cash or, if a participant elects, in the form of Company common shares plus cash for any fractional share.

McKesson Corporation Employer Company Stock Funds (Allocated and Unallocated) — The following ESOP information regarding the shares of McKesson Corporation common stock held is as of March 31 (in thousands):


	2007						2006
	Number of				Fair Value of		Number of				Fair Value of
	Shares		Cost Basis		Shares		Shares		Cost Basis		Shares

Allocated		7,639	$	237,751	$	447,214		8,397	$	242,395	$	437,711
Unallocated		1,024		19,283		59,918		1,837		34,606		95,754

Total		8,663	$	257,034	$	507,132		10,234	$	277,001	$	533,465

The per share fair market value of McKesson Corporation common stock at March 31, 2007 and 2006 was $58.54 and $52.13, respectively.

McKESSON CORPORATION PROFIT-SHARING INVESTMENT PLAN

NOTES TO FINANCIAL STATEMENTS (CONTINUED)
YEARS ENDED MARCH 31, 2007 AND 2006

The following is a reconciliation of the allocated and unallocated net assets of the Non-Participant Directed Investments at fair value for the years ended March 31 (in thousands):


	2007									2006
	Allocated			Unallocated			Total			Allocated			Unallocated			Total

Net Assets (beginning of year)	$	440,300			70,499			510,799		$	340,007		$	66,422		$	406,429
Net appreciation		47,323			6,699			54,022			122,410			34,332			156,742
Dividends and interest		2,632			345			2,977			2,737			547			3,284
Employer contributions					12,036			12,036						14,261			14,261
Benefits paid to participants		(34,905	)					(34,905	)		(26,923	)					(26,923	)
Interest expense					(1,348	)		(1,348	)					(2,850	)		(2,850	)
Administrative fees		(80	)					(80	)
Allocation of 839 shares, at market		43,019			(43,019	)		—
Allocation of 908 shares, at market											42,213			(42,213	)		—
Transfers to participant directed investments		(48,090	)					(48,090	)		(40,144	)					(40,144	)

Net Assets (end of year)	$	450,199			45,212			495,411		$	440,300		$	70,499		$	510,799

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Accounting — The financial statements of the Plan are prepared in accordance with accounting principles generally accepted in the United States of America.

Cash Equivalents — The Plan considers all highly liquid debt instruments with remaining maturities of less than three months at the date of purchase to be cash equivalents.

Use of Estimates — The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires Plan management to make estimates and assumptions that affect the reported amount of net assets available for benefits and changes therein. Actual results could differ from those estimates.

Risk and Uncertainties — The Plan utilizes various investment instruments, including mutual funds, common collective trusts, separately managed accounts and guaranteed investment contracts. Investment securities, in general, are exposed to various risks, such as interest rate, credit and overall market volatility. Due to the level of risk associated with certain investment securities, it is reasonably possible that changes in the values of investment securities will occur in the near term and that such change could materially affect the amounts reported in the financial statements.

New Accounting Pronouncement — The Plan adopted Financial Accounting Standards Board Staff Position, FSP AAG INV-1 and Statement of Position 94-4-1, Reporting of Fully Benefit-Responsive Investment Contracts Held by Certain Investment Companies Subject to the AICPA Investment Company Guide and Defined-Contribution Health and Welfare and Pension Plans (the “FSP”), which became effective for fiscal years ending on or after December 15, 2006. The FSP requires investment contracts held by a defined-contribution plan to be reported at fair value. However, contract value is the relevant measurement attribute for that portion of the net assets available for benefits of a defined-contribution plan attributable to fully benefit-responsive investment contracts because contract value is the amount participants would receive if they were to initiate permitted transactions under the terms of the Plan. As required by the FSP, the accompanying Statement of Net Assets Available for Benefits presents the fair value of the investment contracts, as well as an adjustment of the fully benefit-responsive investments from fair value to contract value. As required, the provisions of the FSP have been retroactively applied to the Statement of Net Assets Available for Benefits for all periods presented for comparative purposes. The Statement of Changes in Net Assets Available for Benefits is prepared on a contract basis.

McKESSON CORPORATION PROFIT-SHARING INVESTMENT PLAN

NOTES TO FINANCIAL STATEMENTS (CONTINUED)
YEARS ENDED MARCH 31, 2007 AND 2006

Investment Valuation and Income Recognition — Investments in mutual funds are stated at quoted market prices, which represent the net asset value of shares held by the Plan at year-end. Investments in the brokerage link are stated at quoted market prices. Investments in common collective trusts are stated at net asset value. Interests in separately managed funds are valued based on the underlying net assets. Within the Standish Mellon Stable Value Fund (“Stable Value Fund”), traditional Guaranteed Investment Contracts (“GICs”) and Variable Synthetic (“VS”) GICs are stated at estimated fair value using discounted cash flows. Fixed Maturity Synthetic (“FMS”) GICs are stated at estimated fair value based on market values of publicly traded bonds that are held as the underlying assets within the FMS GICs. The valuation is provided by FT Interactive Data Corporation. Constant Duration Synthetic (“CDS”) GICs are also held in the Stable Value Fund and are stated at estimated fair value based on market values provided by Barclays Global Investors. Participant loans are valued at the outstanding loan balance. Shares of McKesson Corporation common stock are valued at quoted market prices on March 31, 2007 and 2006. Certain administrative expenses are allocated to the individual funds based upon daily balances invested in each fund and are reflected as a reduction of net appreciation in fair market value of investments and are not separately reflected. Consequently, these management fees and operating expenses are reflected as a reduction of investment return for such investments. All other activity is recorded in the Plan based on the elections of the individual participants in the Plan. Purchases and sales of securities are recorded on a trade-date basis. Realized gains and losses from security transactions are reported on the average cost method. Interest income is recorded on the accrual basis. Dividends are recorded on the ex-dividend date.

Administrative Fees — Administrative fees of the Plan are paid by either McKesson or the Plan, as provided by the Plan document.

Benefits — Benefits are recorded when paid.

3. INVESTMENTS

The fair values of individual investments that represent 5% or more of the Plan’s net assets at March 31 were as follows (in thousands):


	2007		2006

McKesson Corporation Employer (Allocated and Unallocated) * and Employee Company Stock Funds	$	562,156	$	586,718
SSgA S&P 500 Index Fund		164,525		159,392
Dodge & Cox Large Cap Value Fund		141,066		123,576
Standish Mellon Stable Value Fund		110,128		111,338


*		Non-Participant Directed

The Stable Value Fund contains investment contracts with insurance companies and financial institutions in order to provide participants with a stable, fixed-rate return on investment and protection of principal from changes in market interest rates.

Traditional GICs are unsecured, general account obligations of insurance companies. The obligation is backed by the general account assets of the insurance company that writes the investment contract. GIC crediting rates are based upon the rate that is agreed to when the insurance company writes the contract and are generally fixed for the life of the contract.

VS GICs consist of an asset or collection of assets that are managed by the bank or insurance company and are led in a bankruptcy remote vehicle for the benefit of the fund (or plan). The contract is benefit responsive and provides next day liquidity at contract value. The VS GICs crediting rate is reset every quarter based on the then current market index rates and investment spread. The investment spread is established when the contract is issued and is guaranteed by the issuer for the life of the investment.

FMS GICs consist of an asset or collection of assets that are owned by the fund (or plan) and a benefit responsive, contract value wrap contract purchased for the portfolio. The wrap contract provides contract value accounting for the asset and assures that contract value, benefit responsive payments will be made for participant directed withdrawals.

CDS GICs consist of a portfolio of securities owned by the fund (or plan) and a benefit responsive contract value wrap contract purchased for the portfolio. The wrap contract amortizes gains and losses of the underlying securities over the portfolio duration, and assures that contract value, benefit responsive payments will be made for participant directed withdrawals.

McKESSON CORPORATION PROFIT-SHARING INVESTMENT PLAN

NOTES TO FINANCIAL STATEMENTS (CONTINUED)
YEARS ENDED MARCH 31, 2007 AND 2006

The FMS GICs and CDS GICs use wrap contracts in order to manage market risks and to alter the return characteristics of the underlying portfolio of securities owned by the Stable Value Fund to match certain fixed income fund objectives. There are no reserves against these contract values for credit risk of the contract issuer or otherwise. For both FMS and CDS GICs, the fair values of “wraps” provided by issuers are valued by Standish Mellon Asset Management using the combination of a cost and income approach. The methodology uses the cost approach to determine a replacement value of each contract based on an internal pricing matrix developed by the portfolio management and trading team of the Standish Mellon Asset Management Stable Value Group. The methodology then uses the income approach to determine the present value of the fee payments related to the contract, using both the current contractual fees as well as the replacement fees generated by the matrix pricing. The fee payments over the duration of the contract are discounted by using comparable duration swap rates. The carrying value of the contract is the present value of the wrapper cost applying replacement fees less the present value of the wrapper cost applying current contractual fees.

The initial crediting rate for both the FMS and CDS GICs are established based on the market interest rates at the time the initial asset is purchased and is guaranteed to have an interest crediting rate not less than zero percent. The FMS GICs crediting rate is set at the start of the contract and typically resets on quarterly basis. The CDS GICs crediting rate resets every quarter based on the contract value, the market value of the underlying assets and the average duration of the underlying assets. The crediting rate for CDS GICs aims at converging the contract value of the contract and market value of the contract and therefore will be affected by interest rate and market changes.

It is probable that withdrawals and transfers resulting from the following events will limit the ability of the fund to transact at book or contract value. Instead, fair value will likely be used in determining the payouts to the participants:

	•		Employer-initiated events — events within the control of the plan or the plan sponsor which would have a material and adverse impact on the Fund

	•		Employer communications designed to induce participants to transfer from the fund

	•		Competing fund transfer or violation of equity wash or equivalent rules in place

	•		Changes of qualification status of employer or plan

In general, issuers may terminate the GIC and settle at other than contract value if the qualification status of employer or plan changes, breach of material obligations under the contract and misrepresentation by the contract holder, or failure of the underlying portfolio to conform to the pre-established investment guidelines.

The average yield of the entire Standish Mellon Stable Value Fund based on actual earnings was 4.73% and 4.62% at March 31, 2007 and 2006. The average yield of the GICs based on the interest rate credited to participants was 4.58% and 4.52% at March 31, 2007 and 2006. To calculate the required yield, the amount credited to participants for the last day of the period is annualized and divided by the fair value of the investment portfolio on that date.

The GICs are presented in the Statements of Net Assets Available for Benefits at fair value in the investments total, and adjusted to contract value in determining the net assets available for benefits.

McKESSON CORPORATION PROFIT-SHARING INVESTMENT PLAN

NOTES TO FINANCIAL STATEMENTS (CONTINUED)
YEARS ENDED MARCH 31, 2007 AND 2006

The portfolio holdings in the Stable Value fund as of March 31, 2007 and 2006 are shown below (in thousands):


	As of March 31, 2007
	Rating	Investment		Wrap		Adjustment to
	S&P/	at Fair		Contract at		Contract
	Moody’s	Value		Fair Value		Value

Cash /Cash Equivalent:
Fidelity Management Trust Company (STIF) 100-31-TPMZ	Cash/Cash	$	4,030	$	—	$	—
IXIS Financial Products, Inc 975-25 (5 year, CMS-19)	AAA/Aaa		2,017		—		—
Guaranteed Investment Contracts:
Hartford Life Insurance Company GA 10648A	AA-/Aa3		1,376		—		—
Hartford Life Insurance Company GA 10648B	AA-/Aa3		3,452		—		17
New York Life GA 31486	AA+/Aaa		1,517		—		—
Security Life of Denver SA 0484	AA/Aa3		1,609		—		—
Fixed Maturity Investment:
Bank of America, N.A. 03-051	AAA/Aaa		11,781		4		231
Monumental Life Insurance Co(Aegon)MDA00441TR	AAA/Aaa		8,026		1		114
Rabobank Nederland MCK080301	AAA/Aaa		11,813		1		255
Constant Duration Synthetic:
AIG Financial Products 543454	AA+/Aa1		29,586		5		236
IXIS Financial Products, Inc WR1075-01	AA+/Aa1		34,330		27		56
Pooled Funds:
Mellon Stable Value Fund	AA+/Aa1		553		—		5

Total		$	110,090	$	38	$	914


	As of March 31, 2006
	Rating	Investment		Wrap			Adjustment to
	S&P/	at Fair		Contract at			Contract
	Moody’s	Value		Fair Value			Value

Cash/Cash Equivalent:
Fidelity Management Trust Company (STIF) 100-31-TPMZ	Cash/Cash	$	$4,150	$	—		$	—
Guaranteed Investment Contracts:
Hartford Life Insurance Company GA 10648A	AA-/Aa3		2,060		—			(10	)
Hartford Life Insurance Company GA 10648B	AA-/Aa3		3,269		—			74
New York Life GA 31486	AA+/Aaa		1,486		—			32
Security Life of Denver SA 0484	AA/Aa3		2,165		—			34
Principal Life 4-47359-1	AA/Aa2		1,100		—			—
Fixed Maturity Investment:
Bank of America, N.A. 03-051	AAA/Aaa		12,824		2			428
Monumental Life Insurance Co(Aegon)MDA00441TR	AAA/Aaa		10,055		(1	)		215
Rabobank Nederland MCK080301	AAA/Aaa		11,190		(2	)		470
Rabobank Nederland MCK100201	AAA/Aaa		121		—			—
Constant Duration Synthetic:
AIG Financial Products 543454	AA+/Aa1		27,990		(5	)		573
IXIS Financial Products, Inc WR1075-01	AA+/Aa1		32,483		16			405
Pooled Funds:
Mellon Stable Value Fund	AA+/Aa1		2,435		—			43

Total		$	111,328	$	10		$	2,264

McKESSON CORPORATION PROFIT-SHARING INVESTMENT PLAN

NOTES TO FINANCIAL STATEMENTS (CONTINUED)
YEARS ENDED MARCH 31, 2007 AND 2006

During fiscal 2007 and 2006, the Plan’s investments (including gains and losses on investments bought and sold, as well as held during the year) appreciated in value as follows (in thousands):


	2007		2006

Common collective trusts	$	23,926	$	20,862
Mutual funds		2,356		49,259
Separately Managed Accounts		16,055		21,999
McKesson Corporation Common Stock:
Employer Company Stock Fund (Allocated and Unallocated)*		54,022		156,742
Employee Company Stock Fund		6,076		14,183

Total	$	102,435	$	263,045


*		Non-Participant Directed

4. LINE OF CREDIT

In fiscal 1998, the Plan obtained a $35 million line of credit with ABN AMRO Bank N.V. to refinance a portion of the principal payable under the ESOP loans and to more efficiently manage the number of shares released to fund the employee benefits. The line of credit bears interest at London Interbank Offered Rate (“LIBOR”) multiplied by the applicable LIBOR adjustment. The line of credit matures on June 1, 2009. On March 31, 2007 and 2006, interest rates were 4.95% and 4.28% on the outstanding balance totaling $3,000,000 and $3,600,000. At March 31, 2007 and 2006, the line of credit was collateralized by 101,416 and 225,874 unallocated shares of McKesson Corporation common stock.

5. ESOP PROMISSORY NOTES PAYABLE

In June 1989, the Company amended the Plan to add an additional leveraged ESOP. In June 1989, the Plan purchased from the Company 2,849,003 shares of McKesson Corporation Series B ESOP Convertible Preferred Stock ($43.875 stated value) for $125,000,000, financed by a twenty-year term loan from the Company. During fiscal 1995, in connection with the PCS Transaction (a fiscal 1995 transaction involving a reorganization and a sale of a business unit of the Company), all shares of Series B ESOP Convertible Preferred Stock held by the Plan were converted into 5,440,914 shares of Company common stock. In fiscal 1996, in connection with the PCS Transaction, the ESOP purchased 6,259,080 additional shares of Company common stock.

The ESOP promissory note supporting the June 1989 stock purchase is payable to the Company in annual installments plus interest at 8.6% over a twenty-year term ending in fiscal 2010. On March 31, 2007, the outstanding balance of the note was $11,353,000 ($20,983,000 at March 31, 2006). This note is collateralized by 922,124 unallocated shares of McKesson Corporation common stock (1,610,955 at March 31, 2006). In July 2006 and July 2005, additional principal payments of $5,000,000 and $6,000,000 were made to enable the release of additional shares for employer contributions, and each of the scheduled subsequent loan repayment installments was reduced.

Future minimum principal payments required on this note (including a $6,000,000 additional payment made in June 2007) are as follows (in thousands):


Fiscal year	Amount

2008	$	8,850
2009		1,633
2010		870

Total	$	11,353

McKESSON CORPORATION PROFIT-SHARING INVESTMENT PLAN

NOTES TO FINANCIAL STATEMENTS (CONTINUED)
YEARS ENDED MARCH 31, 2007 AND 2006

6. FEDERAL INCOME TAX STATUS

The Internal Revenue Service (“IRS”) has determined and informed the Company by letter dated January 21, 2004, that the Plan is qualified and the trust established under the Plan is tax-exempt, in accordance with the applicable sections of the Internal Revenue Code. In accordance with Revenue Procedure 2006-66, the Plan’s sponsor has requested an updated determination letter on the entire Plan as amended, including the requirements of the Economic Growth and Tax Relief Reconciliation Act of 2001, Pub. L. 107-16 (EGTRRA), and all other items identified on the 2005 Cumulative List of Changes in Plan Qualification Requirements. The Company and the Plan administrator believe that the Plan is currently designed and operated in compliance with the applicable requirements of the Internal Revenue Code and the Plan and related trust continue to be tax-exempt. Therefore no provision for income taxes has been included in the Plan’s financial statements.

During fiscal year 2002, the Department of Labor (the “DOL”) initiated a review of the Plan’s operations. The Plan’s Sponsor has cooperated with the DOL and has addressed matters, if any, requiring corrective action. On May 4, 2007, the Plan Sponsor was notified that the DOL has closed its examination of the Plan.

7. PLAN TERMINATION

The Company’s Board of Directors reserves the right to terminate the Plan. If termination should occur, all participant accounts will immediately vest and each account would receive a distribution equal to the vested account balance. In addition, the unallocated common stock would be liquidated to repay the ESOP promissory notes payable. If the stock liquidation is insufficient to satisfy the notes payable, the Company is obligated to fund the difference.

8. LITIGATION

ERISA Litigation

The Plan’s report on Form 11-K for the year ended March 31, 2006, included a description of an action in the United States District Court for the Northern District of California captioned In re McKesson HBOC, Inc. ERISA Litigation (N.D. Cal. C-00-20030 RMW) (the “ERISA Action”), a lawsuit initiated following announcements by McKesson in April, May and July of 1999 that McKesson had determined that certain software sales transactions in its Information Solutions segment, formerly HBO & Company (“HBOC”), were improperly recorded as revenue and reversed. The ERISA Action was brought on behalf of two putative classes: an “HBOC Sub-Class,” and a “McKesson Sub-Class” The HBOC Sub-Class included participants in the former HBO & Company Profit-Sharing and Savings Plan (the “HBOC Plan”) and their beneficiaries in the period from March 31, 1996 to April 1, 1999 (the date of the merger of the HBOC Plan into the Plan), for whose benefit the HBOC Plan held and acquired HBOC stock (and, after January 12, 1999, McKesson stock). The McKesson Sub-Class included participants in the Plan (excluding employees of HBOC who became participants in the Plan by virtue of the merger of the HBOC Plan into the Plan on or about April 1, 1999) whose accounts were invested in McKesson stock at any time, who maintained an account balance under the Plan as of April 27, 1999, which included McKesson stock, and who had not received a distribution from the Plan as of April 27, 1999. Plaintiffs in the ERISA Action alleged, among other things, that McKesson, HBOC, and the alleged fiduciaries of the Plan and of the HBOC Plan breached their fiduciary duties.

On May 6, 2005, McKesson reached an agreement to settle all claims for the benefit of the HBOC Sub-Class for approximately $18.2 million, in exchange for releases in favor of all defendants, including releases of claims the HBOC Sub-Class might have under ERISA, the federal securities laws, or which relate to the holding, voting or acquisition of McKesson or HBOC securities. The court granted final approval to that settlement on September 9, 2005, holding that it was fair, adequate and reasonable to the HBOC Sub-Class. In November 2005, the Plan received the ERISA Action settlement for the HBOC Sub-Class, less attorneys’ fees, totaling $13,654,000. The ERISA litigation proceeds for the HBOC Sub-Class were allocated to the Plan participants on November 17, 2005. In October 2006, the Plan received $15,000 in residual settlement proceeds which have been allocated to the Plan participants.

In March 2006, the Company reached an agreement to settle all claims for the benefit of the McKesson Sub-Class for $18.5 million, plus certain accrued interest, minus certain costs and expenses such as plaintiffs’ attorneys’ fees. The court granted final approval to that settlement on September 1, 2006, holding that it was fair, adequate and reasonable to the McKesson Sub-Class. This settlement provided for the release of all remaining claims against all defendants in the ERISA Action. In October 2006, the Plan received the ERISA Action settlement for the McKesson Sub-Class, less attorney’s fees, totaling $13,966,000. The ERISA litigation proceeds for the McKesson Sub-Class were allocated to the Plan participants on April 24, 2007.

McKESSON CORPORATION PROFIT-SHARING INVESTMENT PLAN

NOTES TO FINANCIAL STATEMENTS (CONTINUED)
YEARS ENDED MARCH 31, 2007 AND 2006

Accounting Litigation

Also following the announcements by McKesson in April, May and July of 1999 described above, as of March 31, 2007, numerous lawsuits had been filed against McKesson, HBOC, certain of McKesson’s or HBOC’s current or former officers or directors, and other defendants, including Bear Stearns & Co. Inc. (“Bear Stearns”) and Arthur Andersen LLP (“Andersen”), which lawsuits were consolidated into a single proceeding in the Northern District of California captioned, In re McKesson HBOC, Inc. Securities Litigation (No. C-99-20743 RMW) (the “Consolidated Action”). On January 12, 2005, McKesson announced that it reached an agreement to settle the claims against McKesson in the Consolidated Action. On February 24, 2006, the district court gave final approval to the McKesson settlement of the Consolidated Action, and as a result, McKesson paid approximately $960 million into an escrow account established by the lead plaintiff in connection with the settlement. On April 13, 2007, the district court gave final approval to the settlement of related claims against Andersen brought pursuant to the Consolidated Action. In that matter, the district court found the settlement of the claims against Andersen for the sum of $72.5 million in cash, plus accrued interest, was fair, reasonable, and adequate to the settlement class.

The Plan is a member of the class in the Consolidated Action, and as such, has filed claims in connection with both the McKesson and Anderson settlements. Due to the continuing nature of these proceedings, it is unknown what amounts will be distributed to the Plan in relation to settlement of the Consolidated Action.

9. RELATED-PARTY TRANSACTIONS

At March 31, 2007 and 2006, the Plan held approximately 9,592,000 and 11,243,000 common shares of McKesson Corporation, the Plan’s sponsor. The shares are held within the McKesson Corporation Employer and Employee Stock Funds and the Leveraged ESOP. At March 31, 2007 and 2006, the Employer Stock Funds held approximately 7,639,000 and 8,397,000 common shares and the Leveraged ESOP held 1,024,000 and 1,837,000 common shares as collateral for the ESOP loans. At March 31, 2007 and 2006, the Employee Stock Fund held approximately 929,000 and 1,009, 000 shares, respectively.

McKesson Corporation declared dividends of $0.24 per share for both fiscal 2007 and 2006. During the years ended March 31, 2007 and 2006, the Employer Stock Funds received dividend income from McKesson Corporation common shares of approximately $2,344,000 and $2,673,000. During each of the years ended March 31, 2007 and 2006, the Employee Company Stock Fund received dividend income from McKesson Corporation common shares of approximately $238,000 and $235,000.

Certain investment options are managed by Fidelity, which also serves as the Plan’s record-keeper and trustee. Therefore, these transactions qualify as party-in-interest transactions. Fees for investment management services are allocated to the participants with balances in those funds.

McKESSON CORPORATION PROFIT-SHARING INVESTMENT PLAN

NOTES TO FINANCIAL STATEMENTS (CONCLUDED)
YEARS ENDED MARCH 31, 2007 AND 2006

10. RECONCILIATION OF FINANCIAL STATEMENTS TO FORM 5500

The following is a reconciliation of the Statement of Net Assets Available for Benefits and the Statement of Changes in Net Assets Available for Benefits per the financial statements at March 31, 2007 to the Form 5500:

Statement of net assets available for benefits:


	2007		2006
Investments, at fair value per the financial statements	$	1,795,736	$	1,651,259
Adjustment from fair value to contract value for fully benefit-responsive investment contracts		—		2,264

Total investments (current value column) per the Form 5500	$	1,795,736	$	1,653,523

Statement of net assets available for benefits:


	2007			2006
Net assets available for benefit per the financial statements	$	1,784,929		$	1,630,857
Adjustment from contract value to fair value for fully benefit-responsive investment contracts		(914	)		—

Net Assets available for benefits per the Form 5500	$	1,784,015		$	1,630,857

Statement of changes in net assets available for benefits:


	2007
Increase in net assets per the financial statements	$	154,072
Adjustment from contract value to fair value for fully benefit-responsive investment contracts		(914	)

Net increase in net assets available for benefits per the Form 5500	$	153,158

11. SUBSEQUENT EVENTS

In April 2007, the net assets from the Medcon Telemedicine Technology, Inc. 401(k) Profit Sharing Plan totaling $234,000 were merged into the Plan. Also, the net assets from the Per Se Technologies Employee Retirement Savings Plan and the NDC Health Corporation 401(k) Plan totaling $90,489,000 and $51,867,000 were merged into the PSIP in July 2007.

McKESSON CORPORATION PROFIT-SHARING INVESTMENT PLAN

FORM 5500, SCHEDULE H, PART IV, LINE 4i — SCHEDULE OF ASSETS (HELD AT END OF YEAR)
MARCH 31, 2007


			Shares/Units/Interest
Investment/Fund Name	Cost Basis		Rate		Fair Value

* MCKESSON ER STK FUND (allocated)	$	237,751,000		7,639,457	$	447,213,806
* MCKESSON ER STK FUND (unallocated)		19,283,494		1,024,000		59,918,038
* MCKESSON EE STK FUND		35,016,720		929,000		55,023,527
BROKERAGELINK		13,912,173		16,450,603		15,049,468
SSGA BOND INDEX		14,612,122		1,080,879		18,753,252
SSGA BALANCED		44,847,091		1,501,753		54,898,613
WELLNGTON MGMT SMCAP		29,397,646		2,351,556		43,783,624
SSGA S&P 500 INDEX		103,977,858		7,533,215		164,525,419
DODGE & COX LARGE CAP VALUE FUND		84,956,587		6,837,555		141,065,606
UNDERLYING SECURITIES OF STANDISH MELLON STABLE VALUE FUND:
Fidelity (STIF) 100-31-TPMZ		4,029,831	5.34% interest rate			4,029,831
IXIS Financial Products, Inc. 975-25 (5 Year CMS-19)		2,017,092	5.06% interest rate			2,017,471
Mellon Stable Value Fund		558,178	4.61% interest rate			552,849
Bank of America, N.A. 03-051		12,015,410	4.45% interest rate			11,784,733
Hartford Life GA 10648B		3,468,862	3.76% interest rate			3,451,815
IXIS Financial Products, Inc. WR 1075-01		34,391,160	5.16% interest rate			34,357,533
Monumental Life (Aegon) MDA00441TR		8,140,991	4.01% interest rate			8,026,603
NYL GA31486		1,517,564	3.78% interest rate			1,517,195
Security Life of Denver SA 0484		1,608,777	3.63% interest rate			1,608,620
AIG Financial Products 543454		29,825,937	5.04% interest rate			29,590,412
Hartford Life GA10648A		1,376,422	5.66% interest rate			1,376,422
Rabobank MCK080301		12,069,105	4.12% interest rate			11,814,224
* FID DIVERSIFIED INTL		46,067,871		1,508,103		57,443,644
RAINIER LG CAP GROWTH		8,513,115		850,537		8,675,480
PIMCO TOT RETURN ADM		7,010,401		664,005		6,925,574
TMPL FOREIGN SM CO A		496,157		25,054		559,714
ABF BALANCED PA		1,026,465		76,001		1,095,932
ABF LARGE CAP VAL PA		3,742,514		184,103		4,243,578
ABF INTL EQUITY PA		419,418		19,348		470,929
MUTUAL DISCOVERY A		2,362,646		87,892		2,781,786
BARON GROWTH		12,282,265		279,280		14,315,876
BARON ASSET FUND		1,138,977		19,476		1,198,382
UBS GLOBAL EQ Y		2,422		181		2,681
MSI US LG CAP GRTH B		136,358		7,987		163,730
CALV NEWVIS SM CP A		48,833		2,817		46,826
CALVERT SIF BALNCD A		55,118		2,036		62,035
CALVERT SIF BOND A		138,913		8,794		139,743
CALVERT SIF:EQUITY A		1,204		32		1,194
CALVERT CAP ACC A		34,147		1,511		39,796
FMA SMALL COMPANY IS		893,785		42,974		922,216
LOOMIS SM CAP VAL R		427,234		15,887		435,778
ARIEL FUND		5,118,255		107,244		5,775,113
ARIEL APPRECIATION		3,444,702		79,277		3,905,171
LB CORE BOND NB INV		332,105		32,430		320,734
FKLN SMMIDCAP GRTH A		540,030		16,481		659,243
TEMPLETON FOREIGN A		6,340,346		567,719		7,902,645
MUTUAL SHARES CL A		2,858,570		118,464		3,164,162
MANAGERS SPECIAL EQ		84,178		953		82,196
MSI GLOBAL VAL EQ B		56,302		3,281		67,165
MSIFT CP FX INC ADV		423,614		36,742		420,700
MSIFT HIGH YIELD ADV		30,722		2,928		31,625
MSIFT MIDCAP GTH ADV		416,216		20,031		548,035

McKESSON CORPORATION PROFIT-SHARING INVESTMENT PLAN

FORM 5500, SCHEDULE H, PART IV, LINE 4i — SCHEDULE OF ASSETS (HELD AT END OF YEAR)
MARCH 31, 2007


			Shares/Units/Interest
Investment/Fund Name	Cost Basis		Rate		Fair Value

MSIFT VALUE ADVISER		348,667		21,110		379,777
MSI SM CO GROWTH B		179,947		15,299		196,897
MSI EMERGING MKTS B		1,649,733		61,134		1,812,013
NB FOCUS TRUST		180,076		7,253		167,103
NB GENESIS — TR CL		5,535,915		131,396		6,581,648
NB PARTNERS TRUST		982,403		44,068		1,069,523
NB SOCIALLY RESP TR		381,190		24,190		434,938
OAKMARK Select I		488,114		14,442		473,278
OAKMARK FUND I		724,804		17,085		782,501
ALLNZ CCM CAP AP ADM		341,401		19,391		382,381
ALLNZ CCM MID CP ADM		419,476		18,215		486,352
PIM GLBBND AD UNHDGD		496,507		49,561		487,181
PIMCO HIGH YIELD ADM		1,588,513		163,319		1,623,392
PIMCO LOW DUR ADM		347,316		34,317		341,457
PIMCO LT US GOVT ADM		933,301		85,879		915,470
TEMPLETON DEV MKTS A		1,530,894		70,455		1,977,680
TEMPLETON GROWTH A		3,099,938		135,526		3,502,000
TMPL GLOBAL BOND A		2,674,822		252,092		2,803,267
TEMPLETON WORLD A		1,935,797		108,316		2,118,655
AIM CONSTELLATION A		15,586		651		17,316
CS LG CAP GRTH COM		59,827		3,739		67,114
CS MID CAP GRTH COM		80,540		3,204		113,084
RS EMERGING GROWTH		106,393		3,268		117,673
ARTISAN INTL		1,583,365		59,474		1,805,617
MSI INTL EQUITY B		104,344		4,863		103,585
NB GUARDIAN TRUST		93,382		6,583		98,284
DWS INTERNATIONAL S		77,498		1,430		91,587
DOMINI SOCIAL EQUITY		182,520		6,416		215,974
RAINIER SM/MID CAP		966,134		26,635		1,043,010
DWS GLOBAL OPPS S		415,612		9,777		438,431
JANUS ENTERPRISE		21		1		21
AM CENT ULTRA INV		47,633		1,670		45,365
AIM GBL AGGR GRTH A		163,716		7,134		177,143
MANAGERS BOND FUND		962,969		39,028		970,626
MANAGERS CAP APPREC		791		28		845
MANAGERS VALUE		38,335		1,320		36,586
RS SMALLER CO GROWTH		151,465		7,066		150,933
TCW SELECT EQUITY N		298,568		16,024		295,640
CS LARGE CAP VALUE A		133,733		6,698		122,984
AIM BASIC VALUE A		40,151		1,146		42,149
LM VALUE TRUST FI CL		481,183		6,747		527,804
NB FSCIANO INVT		55,291		1,348		58,449
ARTISAN MID CAP INV		754,540		24,583		771,399
OAKMARK EQ & INC I		2,079,664		82,261		2,197,172
ROYCE LOW PR STK SER		1,710,176		101,520		1,789,792
WFA SMALL CAP VAL Z		208,216		6,605		212,604
VK GROWTH & INCOME A		1,046,141		49,502		1,086,568
LD ABBETT AFFILTD A		188,678		12,354		189,144
DWS/D HIGH RTN EQ A		934,812		20,279		1,017,823
VAN KAMPEN EQ INC A		676,420		75,636		686,770
AIM MIDCAP CORE EQ A		132,919		4,620		125,851
WEST ASSET CORE FI		141,212		12,571		142,927
BARON SMALL CAP		370,732		15,536		368,361
WFA C&B MIDCAP VAL D		651,307		28,668		659,089

McKESSON CORPORATION PROFIT-SHARING INVESTMENT PLAN

FORM 5500, SCHEDULE H, PART IV, LINE 4i — SCHEDULE OF ASSETS (HELD AT END OF YEAR)
MARCH 31, 2007


			Shares/Units/Interest
Investment/Fund Name	Cost Basis		Rate		Fair Value

PIMCO REAL RTN BD AD		584,512		54,167		589,879
LMP AGGR GROWTH A		153,106		1,370		155,891
LB HIGH INC BOND INV		17,059		1,856		17,241
ALLNZ NFJ SMCPVAL AD		1,752,974		55,952		1,831,880
WFA SM CO VALUE ADM		151,131		9,575		154,349
RS PARTNERS A		418,401		11,815		431,475
ALL/BERN SMMDCPVAL A		94,235		5,641		98,208
COL/ACORN SELECT Z		1,317,856		53,771		1,529,798
COL CONS HIGH YLD Z		43,821		5,212		44,143
CRM MID CAP VAL INV		1,176,254		41,035		1,271,661
ABF SM CAP VAL PA		747,705		36,473		798,749
AM CEN LG CO VAL INV		56,349		8,044		60,731
NB INTL FUND TRUST		397,848		14,910		410,461
LMP LARGE CAP GRTH A		8,685		377		8,764
ROYCE TOT RETURN SER		233,415		17,455		244,542
AM CENT VISTA INV		207,134		12,978		236,845
ROYCE OPPORTUNITY S		456,517		34,094		456,519
LD ABBETT SMCP BLD A		34,063		2,008		35,658
WFA MIDCP DSCPLD INV		443,131		19,228		446,855
RS VALUE A		105,740		3,775		109,478
ROYCE VALUE PLUS SER		3,431,879		249,556		3,705,905
PNX SMALL-MID CAP I		24,895		1,160		23,777
PNX MID CAP VALUE A		956,750		37,786		1,005,102
NB REGENCY TRUST		25,444		1,714		27,967
LOOMIS GRTH A		61,024		9,616		59,809
TOUCHSTN SC SEL GR Z		7,197		923		7,347
WA CORE PLUS BOND FI		147,407		14,196		149,912
HARTFORD GROWTH Y		246,511		13,266		237,729
HTFD INTL CAP APPR Y		424,397		28,932		442,075
HTFD SM CAP GROWTH Y		118,245		3,576		119,059
* FID FIDELITY		1,348,836		45,413		1,658,469
* FID PURITAN		2,906,468		156,100		3,156,333
* FID TREND		199,660		3,781,653		242,631
* FID SEL COMPUTERS		14,904		403		15,961
* FID SEL ELECTRONICS		53,226		1,198		53,672
* FID SEL FOOD & AG		172,352		3,059		183,473
* FID VALUE STRATEGIES		98,198		2,921		99,227
* FID GINNIE MAE		1,747,789		159,553		1,719,981
* FIDELITY MAGELLAN		64,057,995		618,953		56,522,824
* FID CONTRAFUND		8,498,839		133,123		8,715,560
* FID EQUITY INCOME		4,486,866		83,731		4,875,630
* FID GROWTH COMPANY		3,225,018		56,554		3,931,627
* FIDELITY INVST GR BD		1,160,545		156,238		1,153,040
* FID GROWTH & INCOME		52,217,954		1,422,135		44,086,182
* FID SEL SOFTWARE		289,099		4,546		302,964
* FID INTERMED BOND		7,294,651		708,394		7,296,463
* FID SEL AIR TRANSPRT		119,551		2,415		121,180
* FID CAPITAL & INCOME		4,808,923		567,143		5,126,974
* FID VALUE		9,467,020		134,006		11,316,797
* FID MORTGAGE SEC		208,462		18,787		207,219
* FID SEL GOLD		1,579,372		45,081		1,640,059
* FID SEL BIOTECH		252,483		4,072		252,574
* FID SEL ENERGY SVCS		1,252,982		19,213		1,392,165
* FID SEL INSURANCE		102,611		1,508		105,072

McKESSON CORPORATION PROFIT-SHARING INVESTMENT PLAN

FORM 5500, SCHEDULE H, PART IV, LINE 4i — SCHEDULE OF ASSETS (HELD AT END OF YEAR)
MARCH 31, 2007


			Shares/Units/Interest
Investment/Fund Name	Cost Basis		Rate		Fair Value

* FID SEL RETAILING		117,741		2,199		122,595
* FIDELITY US GOVT RES		2,342,903		2,342,903		2,342,903
* FIDELITY GOVT INCOME		1,193,550		117,088		1,179,077
* FIDELITY CASH RESRVE		10,798,104		10,798,104		10,798,104
* FID SEL ENERGY		3,341,800		72,051		3,740,871
* FID SEL LEISURE		159,292		1,975		158,660
* FID SEL HEALTHCARE		764,078		5,833		739,659
* FID SEL TECHNOLOGY		354,284		5,308		371,724
* FID SEL UTILITIES GR		325,577		6,169		375,614
* FID SEL FINANCIAL		154,423		1,314		153,631
* FID SEL DEFENSE		1,515,106		19,132		1,632,183
* FID SEL BROKERAGE		1,178,112		15,775		1,166,249
* FID SEL CHEMICAL		249,512		3,672		262,392
* FID INDEPENDENCE		281,572		15,706		351,975
* FID OTC PORTFOLIO		258,719		7,751		325,701
* FID OVERSEAS		779,664		20,074		931,232
* FID SEL TELECOMM		194,932		4,094		211,241
* FID SEL HOME FINANCE		36,897		703		32,795
* FID LEVERAGED CO STK		5,291,072		195,675		6,073,764
* FID EUROPE		1,383,920		38,834		1,565,412
* FID PACIFIC BASIN		632,672		26,307		751,852
* FID REAL ESTATE INVS		10,922,680		360,674		13,593,785
* FID BALANCED		12,032,275		676,519		13,550,677
* FID INTL DISCOVERY		5,491,225		188,523		7,375,019
* FID CAP APPRECIATION		4,435,091		172,532		4,784,325
* FID CONVERTIBLE SEC		1,198,974		54,654		1,449,433
* FID CANADA		6,109,472		153,008		7,691,700
* FIDELITY UTILITIES		1,004,338		64,800		1,322,573
* FID BLUE CHIP GROWTH		27,473,502		623,158		27,443,880
* FID ASSET MANAGER		8,159,406		505,055		8,313,207
* FID DISCIPLINED EQTY		692,756		25,039		747,923
* FIDELITY LOW PR STK		14,726,536		410,953		18,357,281
* FID WORLDWIDE		500,973		26,332		547,966
* FID EQUITY INCOME II		15,327,622		670,031		15,852,944
* FID STOCK SELECTOR		158,854		6,265		176,937
* FID ASSET MGR GRTH		701,580		47,570		791,571
* FIDELITY EMERG MRKTS		5,029,644		250,779		6,339,703
* FIDELITY AGGR GROWTH		1,795,420		108,792		2,160,617
* FID ASSET MGR INCOME		1,208,720		94,939		1,213,325
* FID DIVIDEND GROWTH		5,269,028		190,061		6,036,343
* FID NEW MARKETS INC		5,113,504		359,224		5,352,435
* FID EXP & MULTINATL		3,286,937		160,526		3,780,384
* FID FOCUSED STOCK		150,240		14,180		183,069
* FID GLOBAL BALANCED		500,530		24,089		537,181
* FID AGGRESSIVE INTL		623,594		38,656		678,023
* FID SM CAP INDEPEND		925,570		45,817		1,011,639
* FID MID CAP STOCK		7,092,573		289,673		8,997,236
* FID LARGE CAP STOCK		761,537		50,948		905,352
* FID DISCOVERY		556,239		52,118		671,800
* FID SMALL CAP STOCK		3,168,457		182,236		3,608,267
* FID EUROPE CAP APP		2,551,480		98,611		2,811,405
* FIDELITY NORDIC		1,929,385		53,365		2,239,176
* FID ASSET MGR AGGR		567,779		49,816		682,971
* FID LATIN AMERICA		7,595,864		222,011		10,219,184

McKESSON CORPORATION PROFIT-SHARING INVESTMENT PLAN

FORM 5500, SCHEDULE H, PART IV, LINE 4i — SCHEDULE OF ASSETS (HELD AT END OF YEAR)
MARCH 31, 2007


			Shares/Units/Interest
Investment/Fund Name	Cost Basis		Rate		Fair Value

* FID JAPAN		961,313		60,271		1,072,823
* FID SOUTHEAST ASIA		2,767,269		108,873		3,118,131
* FID CHINA REGION		2,360,198		113,448		2,759,061
* FID SEL BUS SV & OUT		13,564		895		15,635
* FID SEL MED EQ & SYS		205,082		8,520		205,678
* FID FOUR IN ONE IDX		563,694		21,844		656,403
* FID JAPAN SMALLER CO		824,445		63,535		801,174
* FID GROWTH & INC II		705,258		72,864		825,545
* FID STRATEGIC INCOME		3,007,205		286,263		3,048,706
* FID FREEDOM INCOME		323,316		29,446		343,344
* FID FREEDOM 2000		152,342		12,465		157,686
* FID FREEDOM 2010		3,310,230		241,425		3,594,819
* FID FREEDOM 2020		8,320,420		582,261		9,223,015
* FID FREEDOM 2030		3,644,628		250,580		4,099,483
* FID SM CAP RTMT		971,883		66,985		1,101,909
SPTN TOTAL MKT INDEX		4,276,955		125,105		5,020,467
SPTN EXTND MKT INDEX		1,441,225		41,238		1,652,830
SPARTAN INTL INDEX		4,021,096		100,802		4,633,846
* FID SHORT TERM BOND		1,173,772		131,950		1,170,397
* FID INTM GOVT INCOME		268,877		26,604		266,310
* FID HIGH INCOME		1,357,285		153,735		1,402,067
* FID FIFTY		1,950,667		94,254		2,285,654
* FID SEL AUTOMOTIVE		21,528		614		24,644
* FID SEL MULTIMEDIA		11,450		248		11,802
* FID SEL MEDICAL DEL		1,211,013		24,221		1,259,032
* FID SEL PAPER&FOREST		50,857		1,491		50,898
* FID SEL BANKING		257,432		7,054		233,150
* FID SEL INDUST MATER		193,580		3,802		196,704
* FID SEL INDUST EQUIP		36,689		1,277		40,566
* FID SEL CONSTR/HOUSE		249,813		5,448		243,211
* FID SEL TRANSPORT		77,689		1,605		84,471
* FID SEL NATURAL GAS		1,722,646		46,854		1,961,789
* FID SEL NATURAL RES		1,360,142		52,729		1,601,382
* FID SEL CYCLICAL IND		19,672		968		20,091
* FID SEL ENVIRONMENT		33,836		2,053		35,455
* FID SEL CONSUMER IND		6,641		243		6,620
* FID SEL DEVELOP COMM		9,765		517		10,851
* FID SEL PHARMACEUTCL		169,421		16,330		178,818
* FIDELITY RETIRE MMKT		28,063,871		28,063,871		28,063,871
* FIDELITY RET GOVT MM		5,160,792		5,160,792		5,160,792
SPARTAN US EQ INDEX		4,821,848		113,727		5,742,089
* FIDELITY US BD INDEX		2,897,848		264,463		2,882,645
* FID INST SH INT GOVT		231,317		24,379		232,090
* FID LARGE CAP VALUE		1,055,139		74,132		1,118,658
* FID FREEDOM 2040		1,856,939		209,845		2,031,301
* FID MID CAP VALUE		1,073,643		67,572		1,179,130
* FID LARGE CAP GROWTH		513,694		45,745		526,977
* FID MID CAP GROWTH		660,912		49,247		699,804
* FID INFLAT PROT BOND		396,242		35,868		390,599
* FID ULTRASHORT BOND		126,933		12,668		126,425
* FID FLOAT RT HI INC		250,292		25,123		250,223
* FID INTL SMALL CAP		2,617,178		97,326		2,571,355
* FID TOTAL BOND		524,583		50,294		527,077
* FID VALUE DISCOVERY		1,220,013		72,997		1,317,588

McKESSON CORPORATION PROFIT-SHARING INVESTMENT PLAN

FORM 5500, SCHEDULE H, PART IV, LINE 4i — SCHEDULE OF ASSETS (HELD AT END OF YEAR)
MARCH 31, 2007


			Shares/Units/Interest
Investment/Fund Name	Cost Basis		Rate		Fair Value

* FID REAL ESTATE INC		240,674		20,319		244,840
* FID SEL NET & INFSTR		31,289		12,753		31,244
* FID SEL WIRELESS		164,652		25,542		183,647
* FID BLUE CHIP VALUE		963,280		67,323		1,020,617
* FID NASDAQ COMP INDX		150,708		4,921		160,092
* FID FREEDOM 2005		69,395		6,057		71,710
* FID FREEDOM 2015		1,569,585		133,127		1,657,429
* FID FREEDOM 2025		2,385,019		190,709		2,486,850
* FID FREEDOM 2035		1,161,588		91,662		1,235,608
* FID STRAT DIV & INC		330,814		25,902		347,093
* FID FOCUSED HIGH INC		2,905		289		2,973
* FID INTL REAL ESTATE		2,669,372		170,038		2,948,456
* FID SMALL CAP GROWTH		322,419		21,999		336,358
* FID SMALL CAP VALUE		460,017		32,663		471,656
* FID INTL SM CAP OPP		475,604		31,363		530,030
* FID STRAT REAL RET		61,690		5,981		62,323
* OUTSTANDING LOAN BALANCE (3,659 loans, interest rates from 5% to 11%)						21,022,655


Total	$	1,316,415,949			$	1,795,735,500


*		Party-in-interest


Item	Page

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM		1

FINANCIAL STATEMENTS as of and for the Years Ended March 31, 2007 and 2006:

Statements of Net Assets Available for Benefits		2

Statements of Changes in Net Assets Available for Benefits		3

Notes to Financial Statements		4-13

SUPPLEMENTAL SCHEDULE AS OF MARCH 31, 2007:

Form 5500, Schedule H, Part IV, Line 4i — Schedule of Assets (Held at End of Year)		15-20

EXHIBITS:

23.1 Consent of Independent Registered Public Accounting Firm


	McKesson Corporation Profit-Sharing Investment Plan
Dated: September 25, 2007	/s/ Jeffrey C. Campbell
	Jeffrey C. Campbell
	Executive Vice President and Chief Financial Officer


	/s/ Paul E. Kirincic
	Paul E. Kirincic
	Executive Vice President Human Resources


þ		ANNUAL REPORT PURSUANT TO SECTION 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934


o		TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934