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Summary of Significant Accounting Policies | 3 Months Ended
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Nov. 30, 2012
Accounting Policies [Abstract] |
Summary of Significant Accounting Policies | Accounting Policies Basis of Presentation and Reclassifications The unaudited Consolidated Balance Sheets as of November 30, 2012 and 2011, the Consolidated Statements of Operations for the three months ended November 30, 2012 and 2011, the Consolidated Statements of Comprehensive Income for the three months ended November 30, 2012 and 2011, and the Consolidated Statements of Cash Flows for the three months ended November 30, 2012 and 2011, reflect in the opinion of our management, all normal recurring adjustments necessary for a fair statement of the financial position, results of operations and cash flows for the interim periods presented. The results of operations and cash flows for interim periods are not necessarily indicative of results for a full fiscal year because of, among other things, the seasonal nature of our businesses. Our Consolidated Balance Sheet data as of August 31, 2012, has been derived from our audited consolidated financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States of America. The consolidated financial statements include our accounts and the accounts of all of our wholly-owned and majority-owned subsidiaries and limited liability companies, which is primarily National Cooperative Refinery Association (NCRA), included in our Energy segment. The effects of all significant intercompany accounts and transactions have been eliminated. These statements should be read in conjunction with the consolidated financial statements and notes thereto for the year ended August 31, 2012, included in our Annual Report on Form 10-K, filed with the Securities and Exchange Commission. In June 2011, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2011-05, “Comprehensive Income (Topic 220): Presentation of Comprehensive Income.” ASU No. 2011-05 eliminates the option to present the components of other comprehensive income as part of the statement of stockholders’ equity. ASU 2011-05 requires an entity to present the total of comprehensive income, the components of net income, and the components of other comprehensive income either in a single continuous statement of comprehensive income or in two separate but consecutive statements. ASU 2011-05 became effective for us during the three months ended November 30, 2012. The required disclosures of these updates are included in our Consolidated Statements of Comprehensive Income. Derivative Financial Instruments and Hedging Activities Our derivative instruments primarily consist of commodity and freight futures and forward contracts and, to a minor degree, may include foreign currency and interest rate swap contracts. These contracts are economic hedges of price risk, but are not designated or accounted for as hedging instruments for accounting purposes, with the exception of immaterial amounts of interest rate swap contracts which were accounted for as cash flow hedges. Derivative instruments are recorded on our Consolidated Balance Sheets at fair values as discussed in Note 9, Fair Value Measurements. We have netting arrangements for our exchange-traded futures and options contracts and certain over-the-counter (OTC) contracts, which are recorded on a net basis in our Consolidated Balance Sheets. Although accounting standards permit a party to a master netting arrangement to offset fair value amounts recognized for derivative instruments against the right to reclaim cash collateral or the obligation to return cash collateral under the same master netting arrangement, we have not elected to net our margin deposits. As of November 30, 2012, August 31, 2012 and November 30, 2011, we had the following outstanding purchase and sales contracts:
| November 30, 2012 |  | August 31, 2012 |  | November 30, 2011
| Purchase Contracts |  | Sales Contracts |  | Purchase Contracts |  | Sales Contracts |  | Purchase Contracts |  | Sales Contracts
| (Units in thousands)
Grain and oilseed - bushels | 674,866 |  | 1,018,510 |  | 722,895 |  | 1,074,535 |  | 573,239 |  | 825,374
Energy products - barrels | 7,483 |  | 19,817 |  | 9,047 |  | 19,561 |  | 8,687 |  | 13,338
Soy products - tons | 21 |  | 360 |  | 15 |  | 215 |  | 14 |  | 285
Crop nutrients - tons | 1,270 |  | 1,428 |  | 600 |  | 725 |  | 829 |  | 1,122
Ocean and barge freight - metric tons | 1,288 |  | 210 |  | 1,018 |  | 183 |  | 1,101 |  | 341
As of November 30, 2012, August 31, 2012 and November 30, 2011, the gross fair values of our derivative assets and liabilities not designated as hedging instruments were as follows:
| November 30, 2012 |  | August 31, 2012 |  | November 30, 2011
|  |  | (Dollars in thousands)
Derivative Assets: |  |  |  |  |  |  |
Commodity and freight derivatives | $ | 632,544 |  |  | $ | 1,070,800 |  |  | $ | 641,890 |
Foreign exchange derivatives | 3,140 |  |  | 978 |  |  | 15 |
| $ | 635,684 |  |  | $ | 1,071,778 |  |  | $ | 641,905 |
Derivative Liabilities: |  |  |  |  |  |  |
Commodity and freight derivatives | $ | 518,377 |  |  | $ | 727,946 |  |  | $ | 540,426 |
Foreign exchange derivatives | 6,234 |  |  | 2,388 |  |  |  |
Interest rate derivatives | 483 |  |  | 544 |  |  | 595 |
| $ | 525,094 |  |  | $ | 730,878 |  |  | $ | 541,021 |
The following table sets forth the pretax gains (losses) on derivatives not accounted for as hedging instruments that have been included in our Consolidated Statements of Operations for the three months ended November 30, 2012 and 2011.
| Location of Gain (Loss) |  | 2012 |  | 2011
|  |  | (Dollars in thousands)
Commodity and freight derivatives | Cost of goods sold |  | $ | (328,284 | ) |  | $ | (50,933 | )
Foreign exchange derivatives | Cost of goods sold |  | (1,685 | ) |  | 686 |
Interest rate derivatives | Interest, net |  | (9 | ) |  |  |
|  |  | $ | (329,978 | ) |  | $ | (50,247 | )
Goodwill and Other Intangible Assets Goodwill was $82.9 million, $81.7 million and $26.2 million on November 30, 2012, August 31, 2012 and November 30, 2011, respectively, and is included in other assets in our Consolidated Balance Sheets. Intangible assets subject to amortization primarily include customer lists, trademarks and agreements not to compete, and are amortized over their respective useful lives (ranging from 2 to 30 years). Excluding goodwill, the gross carrying amount of our intangible assets was $81.7 million, $100.6 million and $75.3 million on November 30, 2012, August 31, 2012 and November 30, 2011, respectively. Accumulated amortization was $38.2 million, $55.7 million and $45.1 million as of November 30, 2012, August 31, 2012 and November 30, 2011, respectively. Intangible assets acquired were $1.0 million during the three-month period ended November 30, 2012. No intangible assets were acquired during the three-month period ended November 30, 2011. Total amortization expense for intangible assets during the three-month periods ended November 30, 2012 and 2011, was $2.5 million and $2.7 million, respectively. The estimated annual amortization expense related to intangible assets subject to amortization for the next five years is as follows:
| (Dollars in thousands) |
Year 1 | $ | 10,666 |
Year 2 | 7,078 |
Year 3 | 6,134 |
Year 4 | 5,875 |
Year 5 | 4,537 |
Thereafter | 9,176 |
| $ | 43,466 |
In our Energy segment, major maintenance activities (turnarounds) at our two refineries are accounted for under the deferral method. Turnarounds are the scheduled and required shutdowns of refinery processing units. The costs related to the significant overhaul and refurbishment activities include materials and direct labor costs. The costs of turnarounds are deferred when incurred and amortized on a straight-line basis over the period of time estimated to lapse until the next turnaround occurs, which is generally 2 to 4 years. The amortization expense related to turnaround costs are included in cost of goods sold in the Consolidated Statements of Operations. The selection of the deferral method, as opposed to expensing the turnaround costs when incurred, results in deferring recognition of the turnaround expenditures. The deferral method also results in the classification of the related cash outflows as investing activities in our Consolidated Statements of Cash Flows, whereas expensing these costs as incurred, would result in classifying the cash outflows as operating activities. For the three months ended November 30, 2012 and 2011, major repairs turnaround expenditures were $3.9 million and $16.6 million, respectively. During the three months ended November 30, 2011, our Laurel Montana refinery completed a turnaround. Recent Accounting Pronouncements In September 2011, the FASB issued ASU No. 2011-08, “Intangibles — Goodwill and Other (Topic 350) — Testing Goodwill for Impairment.” ASU No. 2011-08 allows entities to use a qualitative approach to test goodwill for impairment. It permits an entity to first perform a qualitative assessment to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying value. If it is concluded that this is the case, it is necessary to perform the two-step goodwill impairment test. Otherwise, the two-step goodwill impairment test is not required. This guidance became effective for us during the three months ended November 30, 2012. The adoption of this guidance did not have a material impact on our consolidated financial statements. In December 2011, the FASB issued ASU No. 2011-11, “Disclosures about Offsetting Assets and Liabilities.” ASU No. 2011-11 creates new disclosure requirements about the nature of an entity’s rights of setoff and related arrangements associated with its financial instruments and derivative instruments. The disclosure requirements in this update are effective for annual reporting periods, and interim periods within those years, beginning on or after January 1, 2013. We are currently evaluating the impact that the adoption will have on our consolidated financial statements in fiscal 2014.

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- Definition The entire disclosure for all significant accounting policies of the reporting entity. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section 50 -Paragraph 6 -URI http://asc.fasb.org/extlink&oid=6367646&loc=d3e18861-107790 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=6367646&loc=d3e18743-107790 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=6367646&loc=d3e18780-107790 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section 50 -Paragraph 5 -URI http://asc.fasb.org/extlink&oid=6367646&loc=d3e18854-107790 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6367646&loc=d3e18726-107790 Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher AICPA -Name Accounting Principles Board Opinion (APB) -Number 22 -Paragraph 8 -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. + Details
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