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Summary of Significant Accounting Policies | 6 Months Ended
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Feb. 28, 2014
Accounting Policies [Abstract] |
Summary of Significant Accounting Policies | Accounting Policies Basis of Presentation and Revisions The unaudited Consolidated Balance Sheets as of February 28, 2014 and 2013, the Consolidated Statements of Operations for the the three and six months ended February 28, 2014 and 2013, the Consolidated Statements of Comprehensive Income for the three and six months ended February 28, 2014 and 2013, and the Consolidated Statements of Cash Flows for the six months ended February 28, 2014 and 2013, 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, 2013, 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 (GAAP). The consolidated financial statements include our accounts and the accounts 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, 2013, included in our Annual Report on Form 10-K, filed with the Securities and Exchange Commission. We previously reported certain derivative assets and liabilities on a net basis on our Consolidated Balance Sheets. In connection with the issuance of our August 31, 2013 financial statements, we determined that such derivatives should have been reported on a gross basis and have therefore revised our February 28, 2013 Consolidated Balance Sheet, which resulted in an increase in both derivative assets and derivative liabilities of $212.7 million. The Consolidated Statement of Cash Flows for the six months ended February 28, 2013, has also been revised for this change with no impact to net operating, investing or financing cash flows. We do not believe these revisions are material. In December 2011, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2011-11, “Disclosures about Offsetting Assets and Liabilities.” ASU No. 2011-11, and the subsequent amendments issued in ASU No. 2013-01, "Clarifying the Scope of Disclosures about Offsetting Assets and Liabilities," create new disclosure requirements about the nature of an entity’s rights of setoff and related arrangements associated with certain financial instruments and recognized 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. The required disclosures have been included in Note 9, Derivative Financial Instruments and Hedging Activities. In February 2013, the FASB issued ASU No. 2013-02, "Comprehensive Income (Topic 220): Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income." ASU No. 2013-02 requires an entity to provide information about the effects of significant reclassifications out of accumulated other comprehensive income, by component, either on the face of the financial statements or in the notes to the financial statements and is intended to help improve the transparency of changes in other comprehensive income. ASU No. 2013-02 does not amend any existing requirements for reporting net income or other comprehensive income in the financial statements. ASU No. 2013-02 became effective for our annual and interim reporting periods beginning in fiscal 2014. The required disclosures have been included in Note 6, Equities. Goodwill and Other Intangible Assets Goodwill was $104.6 million, $85.1 million and $88.1 million on February 28, 2014, August 31, 2013 and February 28, 2013, respectively, and is included in other assets on our Consolidated Balance Sheets. We acquired goodwill of $19.4 million during the six months ended February 28, 2014, which related primarily to acquisitions in our Ag segment for which we paid $97.9 million in cash consideration. These acquisitions were not material, individually or in aggregate, to our consolidated financial statements. 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 $113.5 million, $81.5 million and $81.8 million on February 28, 2014, August 31, 2013 and February 28, 2013, respectively. Accumulated amortization was $46.7 million, $46.0 million and $40.5 million as of February 28, 2014, August 31, 2013 and February 28, 2013, respectively. Intangible assets acquired were $36.2 million and $1.4 million during the six months ended February 28, 2014 and 2013, respectively. Intangible assets acquired during the six months ended February 28, 2014, primarily relate to various acquisitions in our Ag segment. Total amortization expense for intangible assets during the six months ended February 28, 2014 and 2013, was $4.9 million and $5.0 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 | $ | 8,141 |
Year 2 | 8,654 |
Year 3 | 7,902 |
Year 4 | 6,334 |
Year 5 | 3,543 |
Thereafter | 31,407 |
Total | $ | 65,981 |
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 is included in cost of goods sold in our 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. Supplier Advance Payments Beginning November 30, 2013, supplier advance payments are reported as a separate line item on our Consolidated Balance Sheets. Prior period amounts have been reclassified accordingly. Supplier advance payments primarily include amounts paid for in-transit grain purchases from suppliers and amounts paid to crop nutrient suppliers to lock in future supply and pricing. Customer Advance Payments Customer advance payments primarily consist of amounts received from customers for in-transit grain shipments and amounts received from crop nutrients customers for future shipments. Recent Accounting Pronouncements In February 2013, the FASB issued ASU No. 2013-04, "Liabilities." ASU No. 2013-04 requires an entity to measure obligations resulting from joint and several liability arrangements for which the total amount of the obligation within the scope of this guidance is fixed at the reporting date, as the sum of the amount the reporting entity agreed to pay on the basis of its arrangement among its co-obligors and any additional amount the reporting entity expects to pay on behalf of its co-obligors. The guidance in this ASU also requires an entity to disclose the nature and amount of the obligation as well as other information about those obligations. The amendments in this ASU are effective for fiscal years, and interim periods within those years, beginning after December 15, 2013. We are currently evaluating the impact that the adoption will have on our consolidated financial statements in fiscal 2015.

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