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RECENTLY ADOPTED ACCOUNTING STANDARDS RECENTLY ADOPTED ACCOUNTING STANDARDS | 12 Months Ended
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Dec. 31, 2018
Accounting Changes and Error Corrections [Abstract] |
Recently Adopted Accounting Standard | RECENTLY ADOPTED ACCOUNTING STANDARDS In May 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2014-09, as amended by ASU No. 2016-12, Revenue from Contracts with Customers (Topic 606), which requires revenue to be recognized based on the amount an entity is expected to be entitled to for promised goods or services provided to customers. Topic 606 also requires expanded disclosures regarding contracts with customers and became effective for us beginning January 1, 2018. We adopted the new standard using the full retrospective method, restating all prior periods, and recorded a $3.3 million increase to retained deficit as of January 1, 2016 due to the cumulative effect of adopting Topic 606. The transition adjustment is related to electing the practical expedient for contracts that had variable consideration that were completed by the date of initial application. Under this practical expedient, we recorded revenue using the final transaction price from inception of the contract, rather than estimating and constraining the variable consideration for contracts that were not complete at the end of a reporting period. Our revenue predominantly continues to be recognized when products are shipped from our manufacturing facilities. Under the new revenue standard, for certain sales where revenue was previously deferred, such as sales in which the final price was not fixed and determinable, we now recognize revenue when the product is shipped using the sales price we expect to realize. Adoption of ASC 606 also resulted in different income statement classification for sales of byproducts generated during the production of potash and Trio®. Prior to the fourth quarter of 2018, we accounted for byproduct sales as a credit to cost of goods sold. Our recast of comparative periods presented reflects this change. In August 2014, the FASB issued Accounting Standards Update ("ASU") No. 2014-15, "Disclosure of Uncertainties about an Entity's Ability to Continue as a Going Concern," which describes how an entity should assess its ability to meet obligations and sets rules for how this information should be disclosed in the financial statements. The new standard applies to all entities for the first annual period in fiscal years ending after December 15, 2016, with early application permitted. We adopted this guidance in 2016 and it did not have a material impact on the disclosures included in our consolidated financial statements. In March 2016, the FASB issued ASU No. 2016-09, "Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting," which became effective for us beginning January 1, 2017. This standard changes several aspects of how we account for share-based payment award transactions, including income tax consequences, classification of awards as either equity or liabilities, classification of excess tax benefits on the statement of cash flows, forfeitures, minimum statutory tax withholding payments, and classification of employee taxes paid on the statement of cash flows when an employer withholds shares for tax-withholding purposes. In accordance with adoption of this standard share-based payment award forfeiture expense will no longer be estimated and will be recorded as forfeitures occur and we have recorded a $0.1 million adjustment to beginning retained earnings for the impact of this cumulative change. In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230) which is intended to clarify and align how certain cash receipts and cash payments are presented and classified in the statement of cash flows where there is currently diversity in practice. ASU No. 2016-15 specifically addresses eight classification issues within the statement of cash flows including debt prepayments or debt extinguishment costs; proceeds from the settlement of insurance claims; and separately identifiable cash flows and application of the predominance principle. This standard became effective for us beginning January 1, 2018. In accordance with the adoption of this standard, principal prepayment costs of $3.0 million for the year ended December 31, 2017, which were previously included in Cash Flows from Operating Activities, are included in Cash Flows from Financing Activities in the statement of cash flows. In October 2016, the FASB issued ASU No. 2016-16, Income Taxes (Topic 740) which became effective for us beginning January 1, 2018. This standard requires us to recognize at the transaction date the income tax consequences of intercompany asset transfers other than inventory. The adoption of this standard did not have a material impact on our condensed consolidated financial statements. In November 2016, the FASB issued ASU 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash (ASU 2016-18") which became effective for us beginning January 1, 2018. This standard requires us to show the changes in the total of cash, cash equivalents, restricted cash and restricted cash equivalents in the statement of cash flows and will no longer require transfers between cash and cash equivalents and restricted cash and restricted cash equivalents in the statement of cash flows. As a result of including restricted cash with cash and cash equivalents when reconciling the beginning-of-period and end-of period total amounts presented on the condensed consolidated statements of cash flows, net cash flows for the year ended December 31, 2017, decreased by $3.5 million and increased by $3.5 million, for the year ended December 31, 2016. The impacts of adopting ASC 606 on the Consolidated Balance Sheet for the year ended December 31, 2017 are as follows (amounts in thousands):
|  | Balance as of December 31, 2017
|  | As Previously Reported |  | Adoption of ASC 606 |  | As Reported
Trade receivables, net |  | $ | 15,076 |  |  | $ | 2,701 |  |  | $ | 17,777 |
Prepaid expenses and other current assets |  | 9,252 |  |  | (3,164 | ) |  | 6,088 |
Retained deficit |  | $ | (243,388 | ) |  | $ | 463 |  |  | $ | (243,851 | )
The impacts of adopting ASC 606, including accounting for byproduct sales as revenue instead of as a credit to cost of goods sold, on the Consolidated Statement of Operations for the years ended December 31, 2017 and 2016, are as follows (amounts in thousands):
|  | Year ended December 31, 2017
|  | As Previously Reported |  | Adoption of ASC 606 |  | As Reported
Sales |  | $ | 163,919 |  |  | $ | 13,996 |  |  | $ | 177,915 |
Freight costs |  | 29,039 |  |  | 2,977 |  |  | 32,016 |
Cost of goods sold |  | 106,341 |  |  | 11,621 |  |  | 117,962 |
Lower of cost or NRV adjustments inventory adjustments |  | 7,324 |  |  | (945 | ) |  | 6,379 |
Gross Margin |  | 11,545 |  |  | 343 |  |  | 11,888 |
Net Loss |  | $ | (22,910 | ) |  | $ | 343 |  |  | $ | (22,567 | )
|  | Year ended December 31, 2016
|  | As Previously Reported |  | Adoption of ASC 606 |  | As Reported
Sales |  | $ | 210,948 |  |  | $ | 1,149 |  |  | $ | 212,097 |
Freight costs |  | 36,256 |  |  | (194 | ) |  | 36,062 |
Cost of goods sold |  | 170,852 |  |  | (1,107 | ) |  | 169,745 |
Gross Deficit |  | (29,247 | ) |  | 2,450 |  |  | (26,797 | )
Net Loss |  | $ | (66,633 | ) |  | $ | 2,450 |  |  | $ | (64,183 | )
The impacts of adopting ASC 606 and ASU 2016-18 on the Consolidated Statement of Cash Flows for the years ended December 31, 2017 and 2016, are as follows:
|  | Year ended December 31, 2017
|  | As Previously Reported |  | Adoption of ASC 606 |  | Adoption of ASU 2016-15 |  | Adoption of ASU 2016-18 |  | As Reported
Net loss |  | $ | (22,910 | ) |  | $ | 343 |  |  | $ | — |  |  | $ | — |  |  | $ | (22,567 | )
Lower of cost or NRV inventory adjustments |  | 7,324 |  |  | (945 | ) |  | — |  |  | — |  |  | 6,379 |
Changes in certain assets and liabilities |  | (9,681 | ) |  | 602 |  |  | 3,001 |  |  | (3,525 | ) |  | (9,603 | )
Net cash provided by (used in) operating activities |  | 17,217 |  |  | — |  |  | 3,001 |  |  | (3,525 | ) |  | 16,693 |
Debt prepayment costs |  | — |  |  | — |  |  | (3,001 | ) |  | — |  |  | (3,001 | )
Net cash used in financing activities |  | (12,759 | ) |  | — |  |  | (3,001 | ) |  | — |  |  | (15,760 | )
Net decrease in cash, cash equivalents and restricted cash |  | (3,396 | ) |  | — |  |  | — |  |  | (3,525 | ) |  | (6,921 | )
Cash, cash equivalents and restricted cash, beginning of the period |  | 4,464 |  |  | — |  |  | — |  |  | 4,006 |  |  | 8,470 |
Cash, cash equivalents and restricted cash, end of the period |  | $ | 1,068 |  |  | $ | — |  |  | $ | — |  |  | $ | 481 |  |  | $ | 1,549 |
|  | Year ended December 31, 2016
|  | As Previously Reported |  | Adoption of ASC 606 |  | Adoption of ASU 2016-15 |  | Adoption of ASU 2016-18 |  | As Reported
Net loss |  | $ | (66,633 | ) |  | $ | 2,450 |  |  | $ | — |  |  | $ | — |  |  | $ | (64,183 | )
Changes in certain assets and liabilities |  | (19,856 | ) |  | (2,450 | ) |  | — |  |  | 3,530 |  |  | (18,776 | )
Net cash (used in) provided by operating activities |  | (18,271 | ) |  | — |  |  | — |  |  | 3,530 |  |  | (14,741 | )
Net (decrease) increase in cash, cash equivalents and restricted cash |  | (4,844 | ) |  | — |  |  | — |  |  | 3,530 |  |  | (1,314 | )
Cash, cash equivalents and restricted cash, beginning of the period |  | 9,308 |  |  | — |  |  | — |  |  | 476 |  |  | 9,784 |
Cash, cash equivalents and restricted cash, end of the period |  | $ | 4,464 |  |  | $ | — |  |  | $ | — |  |  | $ | 4,006 |  |  | $ | 8,470 |

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- Definition The entire disclosure of changes in accounting principles, including adoption of new accounting pronouncements, that describes the new methods, amount and effects on financial statement line items. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 250 -URI http://asc.fasb.org/topic&trid=2122394 + Details
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