NOTE 21 – CORRECTION OF ERRORS AND RESTATEMENT

In the fourth quarter of 2014, the Company’s financial reporting and income tax processes identified financial statement errors in several prior periods within its Rigid Industrial Packaging & Services segment, its Paper Packaging segment and its Flexible Products & Services segment. The errors related to improperly stated deferred tax assets and liabilities, uncertain tax positions, income tax expense, accounting for paper trading activities at cost, Venezuela hyperinflation accounting, inventory, fixed assets and other asset and liability balances. Consequently, the Company has restated certain prior period amounts.

The impact of these prior period errors were not material to the Company in any of those years. However, the aggregate amount of prior period errors, net of tax, of $24.5 million would have been material to the Company’s current year consolidated statement of income. The Company has corrected these errors for all prior periods presented, including each of the quarters ended in 2014 and 2013, by restating the consolidated financial statements and other financial information included herein.

The amounts for prior period errors consisted of the following: $8.3 million for deferred tax assets and liabilities; $5.4 million for uncertain tax positions; $6.5 million for Venezuela hyperinflation accounting; $2.4 million for amortization expense; and $1.9 million for the other asset and liability accounts. In addition, the revenue eliminations from the paper trading transactions reduced both net sales and cost of products sold in the Paper Packing segment by $133.5 million and $140.0 million, for the years ended October 31, 2013 and 2012, respectively.

The following are the previously stated and corrected balances of certain consolidated statements of income, consolidated balance sheets and consolidated statements of cash flows. The “As Reported” amounts are the amounts reported in the Annual Report on Form 10-K for the fiscal year ended October 31, 2013 (Dollars in millions, except per share amounts):


	For the year ended
	October 31, 2013
	As Reported			Adjustments			As Adjusted
Net Sales	$	4,353.4		$	(133.5	)	$	4,219.9
Cost of products sold		3,520.8			(133.1	)		3,387.7
Gross profit		832.6			(0.4	)		832.2
Timberland gains		(17.5	)		0.2			(17.3	)
Non-cash asset impairment charges		34.0			(2.6	)		31.4
Operating profit		339.6			2.0			341.6
Other (income) expense, net		10.8			2.3			13.1
Income before income tax expense and equity earnings of unconsolidated affiliates, net		243.7			(0.3	)		243.4
Income tax (benefit) expense		97.6			1.2			98.8
Net Income		149.0			(1.5	)		147.5
Net (income) loss attributable to noncontrolling interests		(1.7	)		(1.1	)		(2.8	)
Net income attributable to Greif, Inc.		147.3			(2.6	)		144.7
Basic earnings per share attributable to Greif, Inc. common shareholders:
Class A Common Stock	$	2.52		$	(0.05	)	$	2.47
Class B Common Stock	$	3.77		$	(0.07	)	$	3.70
Diluted earnings per share attributable to Greif, Inc. common shareholders:
Class A Common Stock	$	2.52		$	(0.05	)	$	2.47
Class B Common Stock	$	3.77		$	(0.07	)	$	3.70


	October 31, 2013
	As Reported			Adjustments			As Adjusted
Current assets
Inventories	$	375.3		$	(0.9	)	$	374.4
Deferred tax assets		22.2			7.6			29.8
Prepaid expenses and other current assets		132.2			(0.4	)		131.8
Total current assets		1,094.0			6.3			1,100.3
Long-term assets
Goodwill		1,003.5			(5.1	)		998.4
Other intangible assets, net of amortization		180.8			4.4			185.2
Total long-term assets		1,389.9			(0.7	)		1,389.2
Properties, plants and equipment
Machinery and equipment		1,523.7			(1.1	)		1,522.6
Total properties, plants and equipment, net		1,398.3			(1.1	)		1,397.2
Total assets		3,882.2			4.5			3,886.7
Current Liabilities
Other current liabilities		178.8			7.7			186.5
Total current liabilities		801.7			7.7			809.4
Long-term Liabilities
Deferred tax liabilities		238.1			8.3			246.4
Other long-term liabilities		92.9			6.6			99.5
Total long-term liabilities		1,682.5			14.9			1,697.4
Shareholders’ equity
Retained earnings		1,443.8			(25.0	)		1,418.8
Accumulated other comprehensive loss		(159.0	)		6.4			(152.6	)
Total Greif, Inc. shareholders’ equity		1,283.2			(18.6	)		1,264.6
Noncontrolling interests		114.8			0.5			115.3
Total shareholders’ equity		1,398.0			(18.1	)		1,379.9
Total liabilities and shareholders’ equity		3,882.2			4.5			3,886.7


	For the year ended October 31, 2013
	As Reported			Adjustments			As Adjusted
Cash flows from operating activities:
Net income	$	149.0		$	(1.5	)	$	147.5
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation, depletion and amortization		156.9			0.7			157.6
Asset impairments		34.0			(2.6	)		31.4
Deferred income taxes		2.0			0.6			2.6
Gain on disposals of properties, plants and equipment, net		(23.1	)		17.5			(5.6	)
Gain on disposals of timberland, net		—			(17.3	)		(17.3	)
Increase (decrease) in cash from changes in certain assets and liabilities:
Trade accounts receivable		(35.4	)		(0.2	)		(35.6	)
Inventories		(3.5	)		0.9			(2.6	)
Pension and postretirement benefit liabilities		7.5			(11.6	)		(4.1	)
Other, net		8.1			13.5			21.6

Net cash provided by operating activities		250.3			—			250.3


Cash flows from investing activities:
Net cash used in investing activities		(100.7	)		—			(100.7	)


Cash flows from financing activities:
Proceeds from (payments on) trade accounts receivable credit facility, net		30.0			(30.0	)		—
Proceeds from trade accounts receivable credit facility		—			75.6			75.6
Payments on trade accounts receivable credit facility		—			(45.6	)		(45.6	)

Net cash used in financing activities		(159.9	)		—			(159.9	)


	For the year ended
	October 31, 2012
	As Reported			Adjustments			As Adjusted
Net Sales	$	4,269.5		$	(140.0	)	$	4,129.5
Cost of products sold		3,489.9			(139.9	)		3,350.0
Gross profit		779.6			(0.1	)		779.5
Selling, general and administrative expenses		468.4			1.4			469.8
Non-cash asset impairment charges		12.9			0.3			13.2
Operating profit		282.8			(1.8	)		281.0
Other (income) expense, net		7.5			0.2			7.7
Income before income tax expense and equity earnings of unconsolidated affiliates, net		185.4			(2.0	)		183.4
Income tax (benefit) expense		58.8			2.3			61.1
Net Income		127.9			(4.3	)		123.6
Net income attributable to Greif, Inc.		122.4			(4.3	)		118.1
Basic earnings per share attributable to Greif, Inc. common shareholders:
Class A Common Stock	$	2.10		$	(0.07	)	$	2.03
Class B Common Stock	$	3.14		$	(0.11	)	$	3.03
Diluted earnings per share attributable to Greif, Inc. common shareholders:
Class A Common Stock	$	2.10		$	(0.07	)	$	2.03
Class B Common Stock	$	3.14		$	(0.11	)	$	3.03

	October 31, 2012
	As Reported			Adjustments			As Adjusted
Current assets
Trade accounts receivable, less allowance	$	453.8		$	(0.2	)	$	453.6
Deferred tax assets		18.9			6.6			25.5
Prepaid expenses and other current assets		114.8			(0.5	)		114.3
Total current assets		1,055.3			5.9			1,061.2
Long-term assets
Goodwill		976.1			(5.1	)		971.0
Other intangible assets, net of amortization		198.6			5.2			203.8
Total long-term assets		1,373.2			0.1			1,373.3
Properties, plants and equipment
Machinery and equipment		1,472.6			(3.5	)		1,469.1
Total properties, plants and equipment, net		1,424.9			(3.5	)		1,421.4
Total assets		3,853.4			2.5			3,855.9
Current Liabilities
Other current liabilities		187.9			8.5			196.4
Total current liabilities		867.3			8.5			875.8
Long-term Liabilities
Deferred tax liabilities		197.0			7.8			204.8
Other long-term liabilities		117.0			5.1			122.1
Total long-term liabilities		1,675.3			12.9			1,688.2
Shareholders’ equity
Retained earnings		1,394.8			(22.6	)		1,372.2
Accumulated other comprehensive loss		(196.0	)		4.3			(191.7	)
Total Greif, Inc. shareholders’ equity		1,191.2			(18.3	)		1,172.9
Noncontrolling interests		119.6			(0.6	)		119.0
Total shareholders’ equity		1,310.8			(18.9	)		1,291.9
Total liabilities and shareholders’ equity		3,853.4			2.5			3,855.9

	For the year ended October 31, 2012
	As Reported			Adjustments			As Adjusted
Cash flows from operating activities:
Net income	$	127.9		$	(4.3	)	$	123.6
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation, depletion and amortization		154.8			0.8			155.6
Asset impairments		12.9			0.3			13.2
Deferred income taxes		20.2			1.8			22.0
Increase (decrease) in cash from changes in certain assets and liabilities:
Trade accounts receivable		96.7			0.1			96.8
Accounts payable		3.5			(0.2	)		3.3
Other, net		45.3			1.5			46.8

Net cash provided by operating activities		473.3			—			473.3


Cash flows from investing activities:
Net cash used in investing activities		(153.8	)		—			(153.8	)


Cash flows from financing activities:
Proceeds from (payments on) trade accounts receivable credit facility, net		(20.0	)		20.0			—
Proceeds from trade accounts receivable credit facility		—			40.8			40.8
Payments on trade accounts receivable credit facility		—			(60.8	)		(60.8	)

Net cash used in financing activities		(352.2	)		—			(352.2	)

The following are the previously reported and corrected balances of certain equity accounts as of October 31, 2011.


	October 31, 2011
	As Reported			Adjustments			As Adjusted
Retained Earnings	$	1,370.1		$	(18.5	)	$	1,351.6
Noncontrolling interests		127.9			(0.6	)		127.3
Accumulated Other Comprehensive Income (Loss)		(143.6	)		4.3			(139.3	)
Shareholders’ Equity		1,336.2			(14.8	)		1,321.4