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v3.19.1

Restatement of Previously Issued Financial Information (Tables) | 6 Months Ended
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Feb. 28, 2019
Accounting Changes and Error Corrections [Abstract] |
Consolidated Financial Statement Adjustments |
| For the Three Months Ended February 28, 2018 |  |
| As Previously Reported |  | Restatement Adjustments |  | As Restated |  | Accounting Changes* |  | As Presented |  | Restatement References
| (Dollars in thousands) |  |
Revenues | $ | 6,851,093 |  |  | $ | 129,060 |  |  | $ | 6,980,153 |  |  | $ | — |  |  | $ | 6,980,153 |  |  | a, b, c
Cost of goods sold | 6,708,610 |  |  | 136,239 |  |  | 6,844,849 |  |  | 335 |  |  | 6,845,184 |  |  | a, b, c
Gross profit | 142,483 |  |  | (7,179 | ) |  | 135,304 |  |  | (335 | ) |  | 134,969 |  |  |
Marketing, general and administrative | 186,716 |  |  | (3 | ) |  | 186,713 |  |  | 845 |  |  | 187,558 |  |  | c
Reserve and impairment charges (recoveries), net | (11,349 | ) |  | 3 |  |  | (11,346 | ) |  | — |  |  | (11,346 | ) |  | c
Operating earnings (loss) | (32,884 | ) |  | (7,179 | ) |  | (40,063 | ) |  | (1,180 | ) |  | (41,243 | ) |  |
(Gain) loss on disposal of business | (7,705 | ) |  | — |  |  | (7,705 | ) |  | — |  |  | (7,705 | ) |  |
Interest expense | 40,176 |  |  | — |  |  | 40,176 |  |  | — |  |  | 40,176 |  |  |
Other (income) loss | (11,364 | ) |  | — |  |  | (11,364 | ) |  | (1,180 | ) |  | (12,544 | ) |  |
Equity (income) loss from investments | (39,441 | ) |  | — |  |  | (39,441 | ) |  | — |  |  | (39,441 | ) |  |
Income (loss) before income taxes | (14,550 | ) |  | (7,179 | ) |  | (21,729 | ) |  | — |  |  | (21,729 | ) |  |
Income tax expense (benefit) | (181,176 | ) |  | (6,512 | ) |  | (187,688 | ) |  | — |  |  | (187,688 | ) |  | a, c
Net income (loss) | 166,626 |  |  | (667 | ) |  | 165,959 |  |  | — |  |  | 165,959 |  |  |
Net income (loss) attributable to noncontrolling interests | (48 | ) |  | — |  |  | (48 | ) |  | — |  |  | (48 | ) |  |
Net income (loss) attributable to CHS Inc. | $ | 166,674 |  |  | $ | (667 | ) |  | $ | 166,007 |  |  | $ | — |  |  | $ | 166,007 |  |  |
* Previously reported amounts have been revised to reflect the impact of adopting ASU 2017-17 retrospectively during the first quarter of fiscal 2019. Refer to details related to the adoption of new ASUs within Note 1, Basis of Presentation and Significant Accounting Policies. For the three months ended February 28, 2018 Freight derivatives and related misstatements (a) The correction of freight derivatives and related misstatements resulted in a $22.5 million reduction of income before income taxes and a $22.6 million reduction of net income. These adjustments related to a $22.5 million increase of cost of goods sold and a $0.1 million increase of income tax expense related to the tax effect of the freight derivatives and related misstatements. Intercompany misstatements (b) The correction of intercompany misstatements had no impact on income (loss) before income taxes or net income (loss); however, the correction resulted in a $161.5 million increase of both revenues and cost of goods sold due to different practices of eliminating intercompany sales between CHS businesses that existed in previous periods. Other misstatements (c) The correction of other misstatements resulted in a $15.3 million increase of income before income taxes and a $21.9 million increase of net income. The $15.3 million increase of income before income taxes relates primarily to a $13.7 million decrease of cost of goods sold arising from the use of a unit of measure assumption in the calculation of an excise tax credit that was changed during fiscal 2018. The remaining increase relates to a $1.6 million decrease of cost of goods sold as a result of the valuation of crack spread derivatives. In addition to the increase of income before income taxes, an income tax benefit of $6.6 million was recorded to adjust for the impact of other identified misstatements, as well as income tax items that had previously been identified and recorded as out of period adjustments in subsequent periods. Additionally, certain misclassification and offsetting adjustments were made between line items included in the Consolidated Statements of Operations, primarily due to the application of differing accounting policies between businesses. These misclassification adjustments resulted in a $27.7 million decrease of revenues and cost of goods sold.
| For the Six Months Ended February 28, 2018 |  |
| As Previously Reported |  | Restatement Adjustments |  | As Restated |  | Accounting Changes* |  | As Presented |  | Restatement References
| (Dollars in thousands) |  |
Revenues | $ | 14,899,982 |  |  | $ | 112,055 |  |  | $ | 15,012,037 |  |  | $ | — |  |  | $ | 15,012,037 |  |  | a, b, c
Cost of goods sold | 14,444,237 |  |  | 111,669 |  |  | 14,555,906 |  |  | 670 |  |  | 14,556,576 |  |  | a, b, c
Gross profit | 455,745 |  |  | 386 |  |  | 456,131 |  |  | (670 | ) |  | 455,461 |  |  |
Marketing, general and administrative | 326,881 |  |  | (668 | ) |  | 326,213 |  |  | 1,691 |  |  | 327,904 |  |  | c
Reserve and impairment charges (recoveries), net | (15,133 | ) |  | — |  |  | (15,133 | ) |  | — |  |  | (15,133 | ) |  |
Operating earnings (loss) | 143,997 |  |  | 1,054 |  |  | 145,051 |  |  | (2,361 | ) |  | 142,690 |  |  |
(Gain) loss on disposal of business | (7,705 | ) |  | — |  |  | (7,705 | ) |  | — |  |  | (7,705 | ) |  |
Interest expense | 80,878 |  |  | — |  |  | 80,878 |  |  | — |  |  | 80,878 |  |  |
Other (income) loss | (36,378 | ) |  | — |  |  | (36,378 | ) |  | (2,361 | ) |  | (38,739 | ) |  |
Equity (income) loss from investments | (77,803 | ) |  | — |  |  | (77,803 | ) |  | — |  |  | (77,803 | ) |  |
Income (loss) before income taxes | 185,005 |  |  | 1,054 |  |  | 186,059 |  |  | — |  |  | 186,059 |  |  |
Income tax expense (benefit) | (161,240 | ) |  | (5,842 | ) |  | (167,082 | ) |  | — |  |  | (167,082 | ) |  | a, c
Net income (loss) | 346,245 |  |  | 6,896 |  |  | 353,141 |  |  | — |  |  | 353,141 |  |  |
Net income (loss) attributable to noncontrolling interests | (512 | ) |  | — |  |  | (512 | ) |  | — |  |  | (512 | ) |  |
Net income (loss) attributable to CHS Inc. | $ | 346,757 |  |  | $ | 6,896 |  |  | $ | 353,653 |  |  | $ | — |  |  | $ | 353,653 |  |  |
* Previously reported amounts have been revised to reflect the impact of adopting ASU 2017-17 retrospectively during the first quarter of fiscal 2019. Refer to details related to the adoption of new ASUs within Note 1, Basis of Presentation and Significant Accounting Policies. For the six months ended February 28, 2018 Freight derivatives and related misstatements (a) The correction of freight derivatives and related misstatements resulted in a $23.0 million reduction of income before income taxes and a $23.8 million reduction of net income. These adjustments related to a $23.0 million increase of cost of goods sold and a $0.8 million increase of income tax expense related to the tax effect of the freight derivatives and related misstatements. Intercompany misstatements (b) The correction of intercompany misstatements had no impact on income (loss) before income taxes or net income (loss); however, the correction resulted in a $150.2 million increase of both revenues and cost of goods sold due to different practices of eliminating intercompany sales between CHS businesses that existed in previous periods. Other misstatements (c) The correction of other misstatements resulted in a $24.1 million increase of income before income taxes and a $30.7 million increase of net income. The $24.1 million increase of income before income taxes relates primarily to a $13.7 million decrease of cost of goods sold that arose from a unit of measure assumption in the calculation of an excise tax credit that was changed during fiscal 2018. The remaining increase relates to a $7.9 million decrease of cost of goods sold related to the valuation of crack spread derivatives and a $2.6 million increase to expense related to postretirement benefit plan activity that resulted from a timing difference associated with the recording of certain benefit plan expenses (included in cost of goods sold and marketing, general and administrative expenses). In addition to the increase of income before income taxes, an income tax benefit of $6.6 million was recorded to adjust for the impact of other identified misstatements, as well as income tax items that had previously been identified and recorded as out of period adjustments in subsequent periods. Additionally, certain misclassification and offsetting adjustments were made between line items included in the Consolidated Statements of Operations, primarily due to the application of differing accounting policies between businesses. These misclassification adjustments resulted in a $33.4 million decrease of revenues and cost of goods sold. CHS INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited)
| For the Three Months Ended February 28, 2018 |  | For the Six Months Ended February 28, 2018 |  |
| As Previously Reported |  | Restatement Adjustments |  | As Restated |  | As Previously Reported |  | Restatement Adjustments |  | As Restated |  | Restatement References
| (Dollars in thousands) |  |
Net income (loss) | $ | 166,626 |  |  | $ | (667 | ) |  | $ | 165,959 |  |  | $ | 346,245 |  |  | $ | 6,896 |  |  | $ | 353,141 |  |  | a, c
Other comprehensive income (loss), net of tax: |  |  |  |  |  |  |  |  |  |  |  |  |
Postretirement benefit plan activity | 3,141 |  |  | 1 |  |  | 3,142 |  |  | 7,338 |  |  | (2,602 | ) |  | 4,736 |  |  | c
Unrealized net gain (loss) on available for sale investments | 3,554 |  |  | — |  |  | 3,554 |  |  | 7,194 |  |  | — |  |  | 7,194 |  |  |
Cash flow hedges | 1,063 |  |  | — |  |  | 1,063 |  |  | 1,059 |  |  | — |  |  | 1,059 |  |  |
Foreign currency translation adjustment | 2,461 |  |  | (109 | ) |  | 2,352 |  |  | (146 | ) |  | 287 |  |  | 141 |  |  | a
Other comprehensive income (loss), net of tax | 10,219 |  |  | (108 | ) |  | 10,111 |  |  | 15,445 |  |  | (2,315 | ) |  | 13,130 |  |  |
Comprehensive income | 176,845 |  |  | (775 | ) |  | 176,070 |  |  | 361,690 |  |  | 4,581 |  |  | 366,271 |  |  |
Less comprehensive income attributable to noncontrolling interests | (48 | ) |  | — |  |  | (48 | ) |  | (512 | ) |  | — |  |  | (512 | ) |  |
Comprehensive income attributable to CHS Inc. | $ | 176,893 |  |  | $ | (775 | ) |  | $ | 176,118 |  |  | $ | 362,202 |  |  | $ | 4,581 |  |  | $ | 366,783 |  |  |
For the three months ended February 28, 2018 Freight derivatives and related misstatements (a) The correction of freight derivatives and related misstatements resulted in a $22.6 million reduction of net income. Refer to descriptions of the adjustments and their impact on net income (loss) in the Consolidated Statements of Operations section for the three months ended February 28, 2018, above. The adjustment related to foreign currency translation is attributable to the foreign currency impact associated with goodwill that was impaired during fiscal 2015. Intercompany misstatements (b) None. Other misstatements (c) The correction of other misstatements resulted in a $21.9 million increase of net income. Refer to descriptions of the adjustments and their impact on net income (loss) in the Consolidated Statements of Operations section for the three months ended February 28, 2018, above. For the six months ended February 28, 2018 Freight derivatives and related misstatements (a) The correction of freight derivatives and related misstatements resulted in a $23.8 million reduction of net income. Refer to descriptions of the adjustments and their impact on net income (loss) in the Consolidated Statements of Operations section for the six months ended February 28, 2018, above. The adjustment related to foreign currency translation is attributable to the foreign currency impact associated with goodwill that was impaired during fiscal 2015. Intercompany misstatements (b) None. Other misstatements (c) The correction of other misstatements resulted in a $30.7 million increase of net income. Refer to descriptions of the adjustments and their impact on net income (loss) in the Consolidated Statements of Operations section for the six months ended February 28, 2018, above. The adjustment related to postretirement benefit plan activity is attributable to a timing difference associated with recording certain benefit plan expenses. CHS INC. AND SUBSIDIARIES CONSOLIDATED STATEMENT OF CASH FLOWS (Unaudited)
| For the Six Months Ended February 28, 2018 |  |
| As Previously Reported |  | Restatement Adjustments |  | As Restated |  | Accounting Changes* |  | As Presented |  | Restatement References
| (Dollars in thousands) |  |  |
Cash flows from operating activities: |  |  |  |  |  |  |  |  |  |  |  |  |
Net income (loss) | $ | 346,245 |  |  | $ | 6,896 |  |  | $ | 353,141 |  |  | $ | — |  |  | $ | 353,141 |  |  | a, c
Adjustments to reconcile net income to net cash provided by (used in) operating activities: |  |  |  |  |  |  |  |  |  |  |  |  |
Depreciation and amortization | 240,349 |  |  | — |  |  | 240,349 |  |  | — |  |  | 240,349 |  |  |
Amortization of deferred major repair costs | 32,839 |  |  | — |  |  | 32,839 |  |  | — |  |  | 32,839 |  |  |
Equity (income) loss from investments | (77,803 | ) |  | — |  |  | (77,803 | ) |  | — |  |  | (77,803 | ) |  |
Distributions from equity investments | 78,461 |  |  | — |  |  | 78,461 |  |  | — |  |  | 78,461 |  |  |
Provision for doubtful accounts | (3,625 | ) |  | — |  |  | (3,625 | ) |  | — |  |  | (3,625 | ) |  |
Gain and recovery on disposal of business | (24,236 | ) |  | — |  |  | (24,236 | ) |  | — |  |  | (24,236 | ) |  |
Deferred taxes | (166,511 | ) |  | (2,944 | ) |  | (169,455 | ) |  | — |  |  | (169,455 | ) |  | a, c
Other, net | 18,840 |  |  | (2,604 | ) |  | 16,236 |  |  | — |  |  | 16,236 |  |  | c
Changes in operating assets and liabilities, net of acquisitions: |  |  |  |  |  |  |  |  |  |  |  |  |
Receivables | 169,359 |  |  | 29,868 |  |  | 199,227 |  |  | — |  |  | 199,227 |  |  | c
Inventories | (1,076,037 | ) |  | (1,148 | ) |  | (1,077,185 | ) |  | — |  |  | (1,077,185 | ) |  | b, c
Derivative assets | (33,757 | ) |  | 9,230 |  |  | (24,527 | ) |  | — |  |  | (24,527 | ) |  | a, c
Margin and related deposits | 17,895 |  |  | — |  |  | 17,895 |  |  | — |  |  | 17,895 |  |  |
Supplier advance payments | (409,581 | ) |  | — |  |  | (409,581 | ) |  | — |  |  | (409,581 | ) |  |
Other current assets and other assets | 21,344 |  |  | (4,000 | ) |  | 17,344 |  |  | (18,998 | ) |  | (1,654 | ) |  | a, c
Customer margin deposits and credit balances | (51,591 | ) |  | — |  |  | (51,591 | ) |  | — |  |  | (51,591 | ) |  |
Customer advance payments | 314,372 |  |  | 18,500 |  |  | 332,872 |  |  | — |  |  | 332,872 |  |  | c
Accounts payable and accrued expenses | (44,413 | ) |  | (27,634 | ) |  | (72,047 | ) |  | — |  |  | (72,047 | ) |  | b, c
Derivative liabilities | 50,922 |  |  | 5,616 |  |  | 56,538 |  |  | — |  |  | 56,538 |  |  | a, c
Other liabilities | (58,252 | ) |  | — |  |  | (58,252 | ) |  | — |  |  | (58,252 | ) |  |
Net cash provided by (used in) operating activities | (655,180 | ) |  | 31,780 |  |  | (623,400 | ) |  | (18,998 | ) |  | (642,398 | ) |  |
Cash flows from investing activities: |  |  |  |  |  |  |  |  |  |  |  |  |
Acquisition of property, plant and equipment | (142,886 | ) |  | — |  |  | (142,886 | ) |  | — |  |  | (142,886 | ) |  |
Proceeds from disposition of property, plant and equipment | 59,680 |  |  | — |  |  | 59,680 |  |  | — |  |  | 59,680 |  |  |
Proceeds from sale of business | 53,552 |  |  | — |  |  | 53,552 |  |  | — |  |  | 53,552 |  |  |
Expenditures for major repairs | (2,832 | ) |  | — |  |  | (2,832 | ) |  | — |  |  | (2,832 | ) |  |
Investments redeemed | 6,496 |  |  | — |  |  | 6,496 |  |  | — |  |  | 6,496 |  |  |
Changes in CHS Capital notes receivable, net | (25,846 | ) |  | — |  |  | (25,846 | ) |  | — |  |  | (25,846 | ) |  |
Financing extended to customers | (66,014 | ) |  | — |  |  | (66,014 | ) |  | — |  |  | (66,014 | ) |  |
Payments from customer financing | 30,893 |  |  | — |  |  | 30,893 |  |  | — |  |  | 30,893 |  |  |
Other investing activities, net | (10,203 | ) |  | — |  |  | (10,203 | ) |  | — |  |  | (10,203 | ) |  |
Net cash provided by (used in) investing activities | (97,160 | ) |  | — |  |  | (97,160 | ) |  | — |  |  | (97,160 | ) |  |
Cash flows from financing activities: |  |  |  |  |  |  |  |  |  |  |  |  |
Proceeds from lines of credit and long-term borrowings | 18,414,973 |  |  | — |  |  | 18,414,973 |  |  | — |  |  | 18,414,973 |  |  |
Payments on lines of credit, long-term borrowings and capital lease obligations | (17,512,264 | ) |  | 3,052 |  |  | (17,509,212 | ) |  | — |  |  | (17,509,212 | ) |  | c
Preferred stock dividends paid | (84,334 | ) |  | — |  |  | (84,334 | ) |  | — |  |  | (84,334 | ) |  |
Redemptions of equities | (4,742 | ) |  | — |  |  | (4,742 | ) |  | — |  |  | (4,742 | ) |  |
Other financing activities, net | (49,874 | ) |  | (5,987 | ) |  | (55,861 | ) |  | — |  |  | (55,861 | ) |  | c
Net cash provided by (used in) financing activities | 763,759 |  |  | (2,935 | ) |  | 760,824 |  |  | — |  |  | 760,824 |  |  |
Effect of exchange rate changes on cash and cash equivalents | (2,372 | ) |  | — |  |  | (2,372 | ) |  | — |  |  | (2,372 | ) |  |
Net increase (decrease) in cash and cash equivalents and restricted cash | 9,047 |  |  | 28,845 |  |  | 37,892 |  |  | (18,998 | ) |  | 18,894 |  |  | c
Cash and cash equivalents and restricted cash at beginning of period | 181,379 |  |  | — |  |  | 181,379 |  |  | 90,893 |  |  | 272,272 |  |  |
Cash and cash equivalents and restricted cash at end of period | $ | 190,426 |  |  | $ | 28,845 |  |  | $ | 219,271 |  |  | $ | 71,895 |  |  | $ | 291,166 |  |  |
* Previously reported amounts have been revised to reflect the impact of adopting ASU 2016-18 retrospectively during the first quarter of fiscal 2019. Refer to details related to the adoption of new ASUs within Note 1, Basis of Presentation and Significant Accounting Policies. Freight derivatives and related misstatements (a) The correction of freight derivatives and related misstatements resulted in a $23.8 million reduction of net income for the six months ended February 28, 2018. Refer to descriptions of the adjustments and their impact on net income (loss) in the Consolidated Statements of Operations section for the three and six months ended February 28, 2018, above. The impact of the adjustments to the Consolidated Balance Sheets as of August 31, 2017, and February 28, 2018, resulted in certain misclassifications of less than $13.0 million between operating activity line items in the Consolidated Statement of Cash Flows; however, none of the freight derivatives and related misstatements impacted the classifications between operating, investing or financing activities. Intercompany misstatements (b) The correction of intercompany misstatements did not impact net income for the six months ended February 28, 2018; however, the impact of adjustments to the Consolidated Balance Sheets as of August 31, 2017, and February 28, 2018, resulted in certain misclassification adjustments of less than $6.0 million between line items in the Consolidated Statement of Cash Flows. None of the intercompany misstatements impacted the classifications between operating, investing or financing activities within the Consolidated Statement of Cash Flows. Other misstatements (c) The correction of other misstatements resulted in a $30.7 million increase of net income for the six months ended February 28, 2018. Refer to further details of the adjustments and their impact on net income (loss) in the Consolidated Statement of Operations section for the three and six months ended February 28, 2018, above. The impact of the adjustments to the Consolidated Balance Sheets as of August 31, 2017, and February 28, 2018, resulted in certain misclassification adjustments between line items in the Consolidated Statements of Cash Flows. As a result, two misclassification adjustments were made between operating and financing activities, including a $3.1 million reduction of notes payable resulting from a duplicative entry and the misclassification of $6.0 million of cash associated with a timing difference for the application of in-transit cash. In addition, various misclassification adjustments were made between operating activity lines, the most significant of which related to (1) a $24.1 million decrease of inventory and increase in accounts receivable as of August 31, 2017, due to a timing difference related to the settlement of a single ocean vessel and (2) the $21.2 million net impact associated with the decrease of inventory and increase of accounts payable that resulted from the misclassification adjustment for certain items previously included within a contra-inventory account to accounts payable as of August 31, 2017, and February 28, 2018.

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- Definition Tabular disclosure of prior period adjustments to previously issued financial statements including (1) the effect of the correction on each financial statement line item and any per-share amounts affected for each prior period presented (2) the cumulative effect of the change on retained earnings or other appropriate components of equity or net assets in the statement of financial position, as of the beginning of the earliest period presented, and (3) the effect of the prior period adjustments (both gross and net of applicable income tax) on the net income of each prior period presented in the entity's annual report for the year in which the adjustments are made. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 250 -SubTopic 10 -Section 50 -Paragraph 9 -URI http://asc.fasb.org/extlink&oid=109234566&loc=d3e22663-107794 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 250 -SubTopic 10 -Section 50 -Paragraph 7 -URI http://asc.fasb.org/extlink&oid=109234566&loc=d3e22644-107794 Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 250 -SubTopic 10 -Section 50 -Paragraph 8 -URI http://asc.fasb.org/extlink&oid=109234566&loc=d3e22658-107794 + Details
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