TRADE RECEIVABLES SECURITIZATION PROGRAM |
9 Months Ended |
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Sep. 30, 2015 | |
| TRADE RECEIVABLES SECURITIZATION PROGRAM | |
| TRADE RECEIVABLES SECURITIZATION PROGRAM | 12.TRADE RECEIVABLES SECURITIZATION PROGRAM
Bunge and certain of its subsidiaries participate in a trade receivables securitization program (the “Program”) with a financial institution, as administrative agent, and certain commercial paper conduit purchasers and committed purchasers (collectively, the “Purchasers”) that provides for funding up to $700 million against receivables sold into the Program.
As of September 30, 2015 and December 31, 2014, $560 million and $599 million, respectively, of receivables sold under the Program were derecognized from Bunge’s condensed consolidated balance sheets. Proceeds received in cash related to transfers of receivables under the Program totaled $7,431 million and $8,837 million for the nine months ended September 30, 2015 and 2014, respectively. In addition, cash collections from customers on receivables previously sold were $7,540 million and $9,038 million, respectively. As this is a revolving facility, cash collections from customers are reinvested to fund the sale of new receivables. Gross receivables sold under the Program for the nine months ended September 30, 2015 and 2014 were $7,609 million and $8,966 million, respectively. These sales resulted in discounts of $2 million for each of the three months ended September 30, 2015 and 2014, and of $4 million and $6 million for the nine months ended September 30, 2015 and 2014, respectively, which were included in SG&A in the condensed consolidated statements of income. Servicing fees under the Program were not significant in any period.
Bunge’s risk of loss following the sale of the trade receivables is limited to the deferred purchase price (“DPP”), which at September 30, 2015 and December 31, 2014 had a fair value of $84 million and $78 million, respectively, and is included in other current assets in the condensed consolidated balance sheets (see Note 6). The DPP will be repaid in cash as receivables are collected, generally within 30 days. Delinquencies and credit losses on trade receivables sold under the Program during the three and nine months ended September 30, 2015 and 2014 were insignificant. Bunge has reflected all cash flows under the Program as operating cash flows in the condensed consolidated statements of cash flows.
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