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Trade Accounts Receivable Securitization and Sale Programs | 6 Months Ended
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Feb. 28, 2017
Trade Accounts Receivable Securitization and Sale Programs [Abstract] |
Trade Accounts Receivable Securitization and Sale Programs | 7. Trade Accounts Receivable Securitization and Sale Programs The Company regularly sells designated pools of trade accounts receivable under two asset-backed securitization programs and four uncommitted trade accounts receivable sale programs (collectively referred to herein as the “programs”). The Company continues servicing the receivables sold and in exchange receives a servicing fee under each of the programs. Servicing fees related to eac h of the programs recognized during the three months and six months ended February 28, 2017 and February 29, 2016 were not material. The Company does not record a servicing asset or liability on the Condensed Consolidated Balance Sheets as the Company estimates that the fee it receives to service these receivables approximates the fair market compensation to provide the servicing activities. Transfers of the receivables under the programs are accounted for as sales and, accordingly, net receivables sold under the programs are excluded from accounts receivable on the Condensed Consolidated Balance Sheets and are reflected as cash provided by operating activities on the Condensed Consolidated Statements of Cash Flows. a. Asset-Backed Securitization Programs The Company continuously sells designated pools of trade accounts receivable, at a discount, under its North American asset-backed securitization program, currently scheduled to expire on October 20, 2017, and its foreign asset-backed securitization program, currently scheduled to expire on May 1, 2018, (collectively referred to herein as the “asset-backed securitization programs”) t o special purpose entities, which in turn sell 100% of the receivables to conduits administered by unaffiliated financial institutions (for the North American asset-backed securitization program) and to an unaffiliated financial institution and a conduit a dministered by an unaffiliated financial institution (for the foreign asset-backed securitization program). The special purpose entity in the North American asset-backed securitization program is a wholly-owned subsidiary of the Company. The special purpos e entity in the foreign asset-backed securitization program is a separate bankruptcy-remote entity whose assets would be first available to satisfy the creditor claims of the unaffiliated financial institution. The Company is deemed the primary beneficiary of this special purpose entity as the Company has both the power to direct the activities of the entity that most significantly impact the entity’s economic performance and the obligation to absorb losses or the right to receive the benefits that could po tentially be significant to the entity from the transfer of the trade accounts receivable into the special purpose entity. Accordingly, the special purpose entities associated with these asset-backed securitization programs are included in the Company’s Condensed Consolidated Financial Statements. Any portion of the purchase price for the receivables which is not paid in cash upon the sale taking place is recorded as a deferred purchase price receivable, which is paid as payments on the receivables are collected. Net cash proceeds of up to a maximum of $200.0 million and $400.0 million for the North American and foreign asset-backed securitization programs, respectively, are available at any one time. The foreign asset-backed securitization program was amended to increase the facility lim it from $275.0 million to $400.0 million, effective February 13, 2017. In connection with the asset-backed securitization programs, the Company sold $2.2 billion and $4.5 billion of eligible trade accounts receivable during the three months and six months ended February 28, 2017, respectively. In exchange, the Company received cash proceeds of $1.7 billion and $4.0 billion during the three months and six months ended February 28, 2017, respectively, (which represented proceeds from collections reinvested in revolving-period transfers as there were no new transfers duri ng these periods) and a deferred purchase pr ice receivable. The Company sold $1.9 billion and $3.8 billion of eligible trade accounts receivable during the three months and six months ended February 29, 2016, respectively. In exchange, the Company received cash proceeds of $1.4 billion and $3.4 billion during the three months and six months ended February 29, 2016, respectively, (of which approximately $3.0 million represented new transfers and the remainder represented proceeds from collections reinvested in revolving-period transfers) and a deferred purchase price receivable. At February 28, 2017 and February 29, 2016, the deferred purchase price receivables recorded in connection with the asset-backed securitization programs t otaled approximately $467.2 million and $437.7 million, respectively. The Company recognized pretax losses on the sales of receivables under the asset-backed securitization programs of approximately $2.3 million and $4.1 million during the three months and six months ended February 28, 2017, respectively, and approximately $1.2 million and $2.2 million during the three months and six months ended February 29, 2016, respectively, which are recorded to other expense within the Conde nsed Consolidated Statements of Operations. The deferred purchase price receivables recorded under the asset-backed securitization programs are recorded initially at fair value as prepaid expenses and other current assets on the Condensed Consolidated Balance Sheets and are valued using unobservable inputs (Level 3 inputs), primarily discounted cash flows, and due to their credit quality and short-term maturity the fair values approximated book values. The unobservable inputs consist of estimated credit losses and estimated discount rates, which both have an immateri al impact on the fair value calculations of the deferred purchase price receivables. b. Trade Accounts Receivable Sale Programs In connection with four separate trade accounts receivable sale programs with unaffiliated financial institutions, the Company may elect to sell, at a discount, on an ongoing basis, up to a maximum of $650.0 million, $150.0 million, 800.0 million Chinese yuan renminbi (“CNY”) and $100.0 million, respectively, of specific trade accounts receivable at any one time. The $650.0 million trade accounts receivable sale program is an uncommitted facility that w ill expire on August 31, 2017 (as the agreement was automatically extended on October 31, 2016), although any party may elect to terminate the agreement upon 15 days prior notice. The $150.0 million trade accounts receivable sale program is an uncommitted facility that will expire on August 31, 2017 unless renewed. The 800.0 million CNY trade accounts receivable sale program is an uncommitted facility that was entered into on February 15, 2017 and is scheduled to expire on February 15, 2018 unless renewed. The $100.0 million trade accounts receivable sale program is an uncommitted facility that is scheduled to expire on October 3 1, 201 7 (as the agreement was automatically extended on October 31, 2016), although any party may elect to terminate the agreement upon 15 days prior notice. The $100.0 million trade accounts receivable sale program will be automatically extended until November 1, 2018, unless any party gives no less than 30 days prior notice that the agreement should not be extended. During the three months and six months ended February 28, 2017, the Company sold $0.7 billion and $1.7 billion of trade accounts receivable under these programs, respectively, compared to $0.9 billion and $2.3 billion during the three months and six months ended February 29, 2016, respectively. In exchange, the Company received cash proceeds of $0.7 billion and $1.7 billion during the three months and six months ended February 28, 2017, respectively, compared to $0.9 billion and $2.3 billion during the three months and six months ended February 29, 2016, respectively. The resulting losses on the sales of trade accounts receivable were approximately $1.4 million and $2.6 million during the three months and six months ended February 28, 2017, respectively, compared to approximately $1.0 million and $2.0 million during the three months and six months ended February 29, 2016, respectively, and were recorded to other expense within the Condensed Consolidated Statemen ts of Operations.

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- Definition The entire disclosure for a transferor's continuing involvement in financial assets that it has transferred in a securitization or asset-backed financing arrangement, the nature of any restrictions on assets reported by an entity in its statement of financial position that relate to a transferred financial asset (including the carrying amounts of such assets), how servicing assets and servicing liabilities are reported, and (for securitization or asset-backed financing arrangements accounted for as sales) when a transferor has continuing involvement with the transferred financial assets and transfers of financial assets accounted for as secured borrowings, how the transfer of financial assets affects an entity's financial position, financial performance, and cash flows. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 860 -SubTopic 20 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=51814546&loc=d3e107207-111719 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 860 -SubTopic 50 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=56950315&loc=d3e122596-111746 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 860 -SubTopic 50 -Section 50 -Paragraph 4 -URI http://asc.fasb.org/extlink&oid=56950315&loc=d3e122739-111746 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 860 -SubTopic 50 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=56950315&loc=d3e122625-111746 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 860 -SubTopic 10 -Section 50 -Paragraph 4 -URI http://asc.fasb.org/extlink&oid=7519067&loc=SL6226446-111709 Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 860 -SubTopic 20 -Section 50 -Paragraph 4 -URI http://asc.fasb.org/extlink&oid=51814546&loc=d3e107314-111719 Reference 7: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 860 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=7519067&loc=SL6226443-111709 + Details
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