CUSTOMER FINANCING PROGRAMS (Tables)

6 Months Ended

Feb. 28, 2018

CUSTOMER FINANCING PROGRAMS [Abstract]

Monsanto participates in customer financing programs as follows:



	As of
(Dollars in millions)	Feb. 28, 2018		Aug. 31, 2017
Transactions that Qualify for Sales Treatment
U.S. agreement to sell trade receivables⁽¹⁾
Outstanding balance	$	47	$	539
Maximum future payout under recourse provisions	15		21
European and Latin American agreements to sell trade receivables⁽²⁾
Outstanding balance	$	19	$	107
Maximum future payout under recourse provisions	5		27
Agreements with Lenders⁽³⁾
Outstanding balance	$	96	$	92
Maximum future payout under the guarantee	50		52

The gross amounts of receivables sold under transactions that qualify for sales treatment were:



	Gross Amounts of Receivables Sold
	Three Months Ended				Six months ended
(Dollars in millions)	Feb. 28, 2018		Feb. 28, 2017		Feb. 28, 2018		Feb. 28, 2017
Transactions that Qualify for Sales Treatment
U.S. agreement to sell trade receivables⁽¹⁾	$	—	$	—	$	13	$	115
European and Latin American agreements to sell trade receivables⁽²⁾	7		5		15		11

(1)

Monsanto has agreements in the United States to sell trade receivables, both with and without recourse, up to a maximum outstanding balance of $1.4 billion and to service such accounts. These receivables qualify for sales treatment under the Transfers and Servicing topic of the ASC and, accordingly, the proceeds are included in net cash provided by operating activities in the Statements of Consolidated Cash Flows. The liability for the guarantees for sales with recourse is recorded at an amount that approximates fair value, based upon the company’s historical collection experience and a current assessment of credit exposure.

(2)

Monsanto has various agreements in European and Latin American countries to sell trade receivables, both with and without recourse. These receivables qualify for sales treatment under the Transfers and Servicing topic of the ASC and, accordingly, the proceeds are included in net cash provided by operating activities in the Statements of Consolidated Cash Flows. The liability for the guarantees for sales with recourse is recorded at an amount that approximates fair value, based upon the company’s historical collection experience and a current assessment of credit exposure.

(3)

Monsanto has additional agreements with lenders to establish programs that provide financing for select customers in the United States, Latin America and Europe. Monsanto provides various levels of recourse through guarantees of the accounts in the event of customer default. The term of the guarantee is equivalent to the term of the customer loans. The liability for the guarantees is recorded at an amount that approximates fair value, based on the company’s historical collection experience with customers that participate in the program and a current assessment of credit exposure. If performance is required under the guarantee, Monsanto may retain amounts that are subsequently collected from customers.

MONSANTO CO /NEW/ 10-Q