Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Feb. 28, 2018 | Apr. 02, 2018 | |
Document and Entity Information [Abstract] | ||
Document type | 10-Q | |
Document period end date | Feb. 28, 2018 | |
Amendment flag | false | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q2 | |
Entity Registrant Name | MONSANTO CO /NEW/ | |
Entity Central Index Key | 1,110,783 | |
Current Fiscal Year End Date | --08-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity common stock shares outstanding | 441,283,987 |
Statements of Consolidated Oper
Statements of Consolidated Operations (Unaudited) - USD ($) shares in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | |||
Feb. 28, 2018 | Feb. 28, 2017 | Feb. 28, 2018 | Feb. 28, 2017 | ||
Income Statement [Abstract] | |||||
Net Sales | [1] | $ 5,019 | $ 5,074 | $ 7,677 | $ 7,724 |
Cost of goods sold | 2,053 | 2,122 | 3,399 | 3,513 | |
Gross Profit | 2,966 | 2,952 | 4,278 | 4,211 | |
Operating Expenses: | |||||
Selling, general and administrative expenses | 652 | 657 | 1,316 | 1,242 | |
Research and development expenses | 394 | 381 | 776 | 751 | |
Restructuring charges | (1) | 23 | 3 | (13) | |
Pending Bayer transaction related costs | 25 | 27 | 45 | 120 | |
Total Operating Expenses | 1,070 | 1,088 | 2,140 | 2,100 | |
Income from Operations | 1,896 | 1,864 | 2,138 | 2,111 | |
Interest expense | 105 | 102 | 229 | 238 | |
Interest income | (24) | (18) | (39) | (36) | |
Other income, net | (24) | (88) | (121) | (45) | |
Income from Continuing Operations Before Income Taxes | 1,839 | 1,868 | 2,069 | 1,954 | |
Income tax provision | 381 | 505 | 441 | 566 | |
Income from Continuing Operations Including Portion Attributable to Noncontrolling Interest | 1,458 | 1,363 | 1,628 | 1,388 | |
Discontinued Operations: | |||||
Income from operations of discontinued business | 2 | 5 | 4 | 21 | |
Income tax provision | 0 | 2 | 1 | 8 | |
Income from Discontinued Operations | 2 | 3 | 3 | 13 | |
Net Income | 1,460 | 1,366 | 1,631 | 1,401 | |
Net income attributable to noncontrolling interest | 1 | (2) | 3 | 4 | |
Net Income Attributable to Monsanto Company | 1,459 | 1,368 | 1,628 | 1,397 | |
Amounts Attributable to Monsanto Company: | |||||
Income from continuing operations | 1,457 | 1,365 | 1,625 | 1,384 | |
Income from discontinued operations | 2 | 3 | 3 | 13 | |
Net Income Attributable to Monsanto Company | $ 1,459 | $ 1,368 | $ 1,628 | $ 1,397 | |
Basic Earnings per Share Attributable to Monsanto Company: | |||||
Income from continuing operations (in dollars per share) | $ 3.30 | $ 3.11 | $ 3.69 | $ 3.16 | |
Income on discontinued operations (in dollars per share) | 0.01 | 0.01 | 0.01 | 0.03 | |
Net Income Attributable to Monsanto Company (in dollars per share) | 3.31 | 3.12 | 3.70 | 3.19 | |
Diluted Earnings per Share Attributable to Monsanto Company: | |||||
Income from continuing operations (in dollars per share) | 3.27 | 3.08 | 3.64 | 3.13 | |
Income on discontinued operations (in dollars per share) | 0 | 0.01 | 0.01 | 0.03 | |
Net Income Attributable to Monsanto Company (in dollars per share) | $ 3.27 | $ 3.09 | $ 3.65 | $ 3.16 | |
Weighted Average Shares Outstanding: | |||||
Basic (in shares) | 441 | 438.7 | 440.6 | 438.4 | |
Diluted (in shares) | 445.5 | 442.3 | 445.9 | 442.3 | |
Dividends Declared per Share | $ 1.08 | $ 1.08 | $ 1.08 | $ 1.08 | |
[1] | (1)Represents net sales from continuing operations. |
Statements of Consolidated Comp
Statements of Consolidated Comprehensive Income (Loss) (Unaudited) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Feb. 28, 2018 | Feb. 28, 2017 | Feb. 28, 2018 | Feb. 28, 2017 | |
Statement of Comprehensive Income [Abstract] | ||||
Net Income | $ 1,460 | $ 1,366 | $ 1,631 | $ 1,401 |
Comprehensive Income Attributable to Monsanto Company | ||||
Net Income Attributable to Monsanto Company | 1,459 | 1,368 | 1,628 | 1,397 |
Other Comprehensive Income (Loss), Net of Tax: | ||||
Foreign currency translation, net of tax of $28, $(1), $(2) and $0, respectively | 107 | 171 | 25 | (98) |
Postretirement benefit plan activity, net of tax of $49, $6, $53 and $12, respectively | (39) | 13 | (33) | 23 |
Unrealized net losses on investment holdings, net of tax of $1, $0, $0 and $(1), respectively | 0 | (1) | (1) | (2) |
Realized net (gains) losses on investment holdings, net of tax of $0, $1, $0 and $1, respectively | (1) | 1 | (1) | 1 |
Unrealized net derivative (losses) gains, net of tax of $28, $6, $32 and $21, respectively | (18) | 7 | (11) | 38 |
Realized net derivative losses, net of tax of $1, $4, $1 and $19, respectively | 1 | 8 | 3 | 29 |
Total Other Comprehensive Income (Loss), Net of Tax | 50 | 199 | (18) | (9) |
Comprehensive Income Attributable to Monsanto Company | 1,509 | 1,567 | 1,610 | 1,388 |
Comprehensive Income (Loss) Attributable to Noncontrolling Interests | ||||
Net income attributable to noncontrolling interest | 1 | (2) | 3 | 4 |
Other Comprehensive Income | ||||
Foreign currency translation | 0 | 1 | 0 | 0 |
Total Other Comprehensive Income | 0 | 1 | 0 | 0 |
Comprehensive Income (Loss) Attributable to Noncontrolling Interests | 1 | (1) | 3 | 4 |
Total Comprehensive Income | $ 1,510 | $ 1,566 | $ 1,613 | $ 1,392 |
Statements of Consolidated Com4
Statements of Consolidated Comprehensive Income (Loss) (Unaudited) (Parenthetical) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Feb. 28, 2018 | Feb. 28, 2017 | Feb. 28, 2018 | Feb. 28, 2017 | |
Other Comprehensive Income (Loss), Tax, Parenthetical Disclosures [Abstract] | ||||
Foreign currency translation, tax expense (benefit) | $ 28 | $ (1) | $ (2) | $ 0 |
Postretirement benefit plan activity, tax benefit | 49 | 6 | 53 | 12 |
Unrealized net gains on investment holdings, tax (expense) benefit | 1 | 0 | 0 | (1) |
Realized net gains on investment holdings, tax (expense) benefit | 0 | 1 | 0 | 1 |
Unrealized net derivative gains (losses), tax (expense) benefit | 28 | 6 | 32 | 21 |
Realized net derivative (gains) losses, tax (expense) benefit | $ 1 | $ 4 | $ 1 | $ 19 |
Statements of Consolidated Fina
Statements of Consolidated Financial Position (Unaudited) - USD ($) $ in Millions | Feb. 28, 2018 | Aug. 31, 2017 |
Current Assets: | ||
Cash and cash equivalents (variable interest entity restricted - 2018: $19 and 2017: $94) | $ 2,409 | $ 1,856 |
Trade receivables, net (variable interest entity restricted - 2018: $124 and 2017: $74) | 2,520 | 2,161 |
Miscellaneous receivables (variable interest entity restricted - 2018: $8 and 2017: $5) | 772 | 827 |
Inventory, net | 4,015 | 3,340 |
Assets held for sale | 30 | 199 |
Other current assets (variable interest entity restricted - 2018: $0 and 2017: $1) | 310 | 268 |
Total Current Assets | 10,056 | 8,651 |
Total property, plant and equipment | 12,705 | 12,231 |
Less accumulated depreciation | 6,596 | 6,301 |
Property, Plant and Equipment, Net | 6,109 | 5,930 |
Goodwill | 4,100 | 4,088 |
Other Intangible Assets, Net | 977 | 1,024 |
Deferred Tax Assets (variable interest entity restricted - 2018: $11 and 2017: $11) | 495 | 564 |
Long-Term Receivables, Net | 58 | 121 |
Other Assets (variable interest entity restricted - 2018: $4 and 2017: $4) | 892 | 955 |
Total Assets | 22,687 | 21,333 |
Current Liabilities: | ||
Short-term debt, including current portion of long-term debt (variable interest entity restricted - 2018: $2 and 2017: $0) | 1,212 | 870 |
Accounts payable (variable interest entity restricted - 2018: $1 and 2017: $9) | 875 | 1,068 |
Income taxes payable | 200 | 58 |
Accrued compensation and benefits | 261 | 578 |
Accrued marketing programs | 1,754 | 1,918 |
Deferred revenues (variable interest entity restricted - 2018: $1 and 2017: $0) | 1,686 | 727 |
Grower production accruals | 189 | 59 |
Dividends payable | 239 | 237 |
Customer payable | 13 | 106 |
Restructuring reserves | 18 | 37 |
Miscellaneous short-term accruals (variable interest entity restricted - 2018: $2 and 2017: $2) | 702 | 740 |
Total Current Liabilities | 7,149 | 6,398 |
Long-Term Debt (variable interest entity restricted - 2018: $97 and 2017: $104) | 6,635 | 7,254 |
Postretirement Liabilities | 303 | 313 |
Long-Term Deferred Revenue | 114 | 114 |
Noncurrent Deferred Tax Liabilities | 139 | 192 |
Long-Term Portion of Environmental and Litigation Liabilities | 213 | 218 |
Other Liabilities | 368 | 386 |
Shareowners’ Equity: | ||
Common stock (authorized: 1,500,000,000 shares, par value $0.01) Issued 614,343,272 and 613,219,246 shares, respectively; Outstanding 440,702,218 and 439,578,276 shares, respectively | 6 | 6 |
Treasury stock 173,641,138 and 173,640,970 shares respectively, at cost | (15,053) | (15,053) |
Additional contributed capital | 11,956 | 11,840 |
Retained earnings | 13,290 | 12,072 |
Accumulated other comprehensive loss | (2,445) | (2,427) |
Total Monsanto Company Shareowners’ Equity | 7,754 | 6,438 |
Noncontrolling Interest | 12 | 20 |
Total Shareowners’ Equity | 7,766 | 6,458 |
Total Liabilities and Shareowners’ Equity | $ 22,687 | $ 21,333 |
Statements of Consolidated Fin6
Statements of Consolidated Financial Position (Parenthetical) (Unaudited) - USD ($) $ in Millions | Feb. 28, 2018 | Aug. 31, 2017 |
Current Assets: | ||
Cash and cash equivalents (variable interest entity restricted) | $ 19 | $ 94 |
Trade receivables, net (variable interest entity restricted) | 124 | 74 |
Miscellaneous Receivable (variable interest entity restricted) | 8 | 5 |
Other Current Assets (variable interest entity restricted) | 0 | 1 |
Non Current Assets: | ||
Deferred Tax Assets (variable interest entity restricted) | 11 | 11 |
Other Assets (variable interest entity restricted) | 4 | 4 |
Current Liabilities: | ||
Short term debt (variable interest entity restricted) | 2 | 0 |
Accounts Payable (variable interest entity restricted) | 1 | 9 |
Deferred revenues (variable interest entity restricted) | 1 | 0 |
Miscellaneous Short-Term Accruals (variable interest entity restricted) | 2 | 2 |
Non Current Liabiliies: | ||
Long Term Debt (variable interest entity restricted) | $ 97 | $ 104 |
Shareowners’ Equity: | ||
Common Stock, Authorized | 1,500,000,000 | 1,500,000,000 |
Common Stock, Par Value | $ 0.01 | $ 0.01 |
Common Stock, Issued | 641,841,751 | 613,219,246 |
Common Stock, Outstanding | 441,200,613 | 439,578,276 |
Treasury Stock, at Cost | 173,641,138 | 173,640,970 |
Statements of Consolidated Cash
Statements of Consolidated Cash Flows (Unaudited) - USD ($) $ in Millions | 6 Months Ended | |
Feb. 28, 2018 | Feb. 28, 2017 | |
Operating Activities: | ||
Net Income | $ 1,631 | $ 1,401 |
Items that did not require (provide) cash: | ||
Depreciation and amortization | 381 | 372 |
Bad-debt expense | 24 | 49 |
Stock-based compensation expense | 63 | 67 |
Excess tax benefits from stock-based compensation | 0 | (5) |
Deferred income taxes | (14) | 54 |
Restructuring impairments | 2 | 20 |
Equity affiliate expense, net | 3 | 3 |
Net gain on sale of a business or other assets | (118) | (83) |
Other items | 35 | 54 |
Changes in assets and liabilities that provided (required) cash, net of acquisitions: | ||
Trade receivables, net | (357) | (690) |
Inventory, net | (699) | (416) |
Deferred revenue | 973 | 829 |
Accounts payable and other accrued liabilities | (361) | 68 |
Restructuring, net | (28) | (111) |
Pension contributions | (11) | (27) |
Other items, net | 106 | (48) |
Net Cash Provided by Operating Activities | 1,630 | 1,537 |
Cash Flows Provided (Required) by Investing Activities: | ||
Maturities of short-term investments | 7 | 50 |
Capital expenditures | (661) | (543) |
Acquisition of businesses, net of cash acquired | 0 | (7) |
Technology and other investments | (25) | (38) |
Other investments and property disposal proceeds | 313 | 100 |
Net Cash Required by Investing Activities | (366) | (438) |
Cash Flows Provided (Required) by Financing Activities: | ||
Net change in financing with less than 90-day maturities | 39 | (140) |
Short-term debt proceeds | 60 | 18 |
Short-term debt reductions | (14) | (11) |
Long-term debt proceeds | 0 | 600 |
Long-term debt reductions | (367) | (510) |
Debt issuance costs | 0 | (2) |
Stock option exercises | 82 | 37 |
Excess tax benefits from stock-based compensation | 0 | 5 |
Tax withholding on restricted stock and restricted stock units | (27) | (15) |
Dividend payments | (476) | (475) |
Payments to noncontrolling interests | (11) | (1) |
Net Cash Required by Financing Activities | (714) | (494) |
Effect of Exchange Rate Changes on Cash and Cash Equivalents | 3 | 0 |
Net Increase in Cash and Cash Equivalents | 553 | 605 |
Cash and Cash Equivalents at Beginning of Period | 1,856 | 1,676 |
Cash and Cash Equivalents at End of Period | $ 2,409 | $ 2,281 |
Statements of Consolidated Shar
Statements of Consolidated Shareholders Equity (Unaudited) - USD ($) $ in Millions | Total | Common Stock | Treasury Stock | Additional Contributed Capital | Retained Earnings [Member] | Accumulated Other Comprehensive (Loss) | NonControlling Interests | |
Beginning Balance at Aug. 31, 2016 | $ 4,545 | $ 6 | $ (15,053) | $ 11,626 | $ 10,763 | $ (2,808) | [1] | $ 11 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net Income | 2,273 | 2,260 | 13 | |||||
Other Comprehensive Income | 382 | 381 | [1] | 1 | ||||
Restricted Stock and Restricted Stock Unit Tax Withholding | (18) | (18) | ||||||
Issuance of Shares Under Employee Stock Plans | 105 | 105 | ||||||
Stock-based Compensation Expense | 127 | 127 | ||||||
Cash Dividends | (951) | (951) | ||||||
Payments to Noncontrolling Interest | (5) | (5) | ||||||
Ending Balance at Aug. 31, 2017 | 6,458 | 6 | (15,053) | 11,840 | 12,072 | (2,427) | [1] | 20 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net Income | 1,631 | 1,628 | 3 | |||||
Other Comprehensive Income | (18) | (18) | 0 | |||||
Reclassification of Accumulated Other Comprehensive Loss Tax Effects (2) | 68 | 68 | ||||||
Issuance of Shares Under Employee Stock Plans | 80 | 80 | ||||||
Restricted Stock and Restricted Stock Unit Tax Withholding | (27) | (27) | ||||||
Stock-based Compensation Expense | 63 | 63 | ||||||
Cash Dividends | (478) | (478) | ||||||
Payments to Noncontrolling Interest | (11) | (11) | ||||||
Ending Balance at Feb. 28, 2018 | $ 7,766 | $ 6 | $ (15,053) | $ 11,956 | $ 13,290 | $ (2,445) | [1] | $ 12 |
[1] | See Note 16 — Accumulated Other Comprehensive Loss — for further details of the components of accumulated other comprehensive loss. |
Statements of Consolidated Sha9
Statements of Consolidated Shareholders Equity (Parenthetical) (Unaudited) - $ / shares | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Feb. 28, 2018 | Feb. 28, 2017 | Feb. 28, 2018 | Feb. 28, 2017 | Aug. 31, 2017 | |
Statement of Stockholders' Equity [Abstract] | |||||
Cash dividends per common share | $ 1.08 | $ 1.08 | $ 1.08 | $ 1.08 | $ 2.16 |
BACKGROUND AND BASIS OF PRESENT
BACKGROUND AND BASIS OF PRESENTATION | 6 Months Ended |
Feb. 28, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
BACKGROUND AND BASIS OF PRESENTATION | BACKGROUND AND BASIS OF PRESENTATION Monsanto Company, along with its subsidiaries, is a leading global provider of agricultural products for farmers. Monsanto’s seeds, biotechnology trait products, herbicides and digital agriculture products provide farmers with solutions that help improve productivity, reduce the costs of farming and produce better food for consumers and better feed for animals. Monsanto manages its business in two reportable segments: Seeds and Genomics and Agricultural Productivity. Through the Seeds and Genomics segment, Monsanto produces leading seed brands, including DEKALB , Asgrow , Deltapine , Seminis and De Ruiter , and Monsanto develops biotechnology traits that assist farmers in controlling insects and weeds and digital agriculture products, including Climate Fieldview to assist farmers in decision making. Monsanto also provides other seed companies with genetic material and biotechnology traits for their seed brands. Through the Agricultural Productivity segment, the company manufactures Roundup and XtendiMax Herbicide with VaporGrip Technology brand herbicides and other herbicides. See Note 20 — Segment Information — for further details. In the fourth quarter of 2008, the company announced plans to divest its animal agricultural products business, which focused on dairy cow productivity and was previously reported as part of the Agricultural Productivity segment. This transaction was consummated on Oct. 1, 2008, and included a 10 -year earn-out with potential annual payments being earned by Monsanto if certain revenue levels are exceeded. As a result, financial data for this business has been presented as discontinued operations. On Jul. 25, 2017, the company signed a definitive agreement with AGCO Corporation to sell the Precision Planting equipment business for approximately $200 million in cash. As of Aug. 31, 2017, Monsanto had $156 million of assets held for sale and $12 million of liabilities held for sale classified within miscellaneous short-term accruals on the Statement of Consolidated Financial Position related to this transaction. The assets were primarily classified as inventory, net; trade receivables, net; property, plant, and equipment, net; goodwill; and other intangible assets, net, and the liabilities were primarily classified as accrued marketing programs and accounts payable. In the first quarter of fiscal 2018, the company closed on its sale of the Precision Planting equipment business, and a gain of approximately $52 million was recognized within other income, net in the Statement of Consolidated Operations. In addition to the aforementioned divestment, during the three and six months ended Feb. 28, 2018, the company recognized income of approximately $50 million and $83 million within other income, net in the Statements of Consolidated Operations as a result of non-core asset sales. During the three months ended Feb. 28, 2018, approximately $50 million of income was recorded in the Agricultural Productivity segment. During the six months ended Feb. 28, 2018, approximately $83 million of income was split by segment as follows: $50 million in Agricultural Productivity and $33 million in Seeds and Genomics. In the second quarter of fiscal 2017, the company divested its European-based silthiofam seed-treatment chemical business previously reported as part of the Agricultural Productivity segment for approximately $140 million in cash. Approximately $85 million , less the carrying amount of assets sold of approximately $2 million , was recognized within other income, net in the Statements of Consolidated Operations for the three and six months ended Feb. 28, 2017. The recognition of the remaining $55 million is contingent on silthiofam re-registration within the European Union. The company did not have any other material non-core asset sales in the three and six months ended Feb. 28, 2017, except as described above. The accompanying consolidated financial statements have not been audited but have been prepared in conformity with accounting principles generally accepted in the United States for interim financial information and with instructions to Form 10-Q and Article 10 of Regulation S-X. In the opinion of management, these unaudited consolidated financial statements contain all necessary adjustments which are normal and recurring to present fairly the financial position, results of operations and cash flows for the interim periods reported. This Report on Form 10-Q should be read in conjunction with Monsanto’s Report on Form 10-K for the fiscal year ended Aug. 31, 2017 . Financial information for the second quarter and first six months of fiscal year 2018 should not be annualized because of the seasonality of the company’s business. |
NEW ACCOUNTING STANDARDS
NEW ACCOUNTING STANDARDS | 6 Months Ended |
Feb. 28, 2018 | |
NEW ACCOUNTING STANDARDS [Abstract] | |
NEW ACCOUNTING STANDARDS | NEW ACCOUNTING STANDARDS In February 2018, the Financial Accounting Standards Board (“FASB”) issued accounting guidance, “Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income” which permits entities to reclassify tax effects stranded in accumulated other comprehensive income(loss) as a result of the Tax Cuts and Jobs Act to retained earnings. This standard is effective for fiscal years, and interim periods within those fiscal years, beginning after Dec. 15, 2018, with early adoption permitted. Monsanto is required to adopt the standard in the first quarter of fiscal year 2020. The company elected to early adopt this standard in the second quarter of fiscal 2018, which coincides with the period of enactment of the Tax Cuts and Jobs Act. In the second quarter of fiscal 2018, Monsanto reclassified $68 million of income from accumulated other comprehensive loss into retained earnings due to the change in the U.S. federal corporate income tax rate. Monsanto did not have any other income tax effects of the Tax Cuts and Jobs Act on items remaining in accumulated other comprehensive loss that the company needed to reclassify into retained earnings under this adoption. In August 2017, the FASB issued accounting guidance, “Targeted Improvements to Accounting for Hedging Activities” which seeks to better align an entity’s risk management activities and financial reporting for hedging relationships through changes to both the designation and measurement guidance for qualifying hedging relationships and the presentation of hedge results. This standard is effective for fiscal years, and interim periods within those fiscal years, beginning after Dec. 15, 2018. Adoption will be applied on a modified retrospective approach to existing hedging relationships as of the date of adoption. Monsanto is required to adopt this standard in the first quarter of fiscal year 2020. The company is currently evaluating the impact this guidance will have on the consolidated financial statements and related disclosures. In May 2017, the FASB issued accounting guidance, “Scope of Modification Accounting” which clarifies modification accounting for share-based payment awards should not be applied if the fair value, vesting conditions, and classification of the modified award are the same before and immediately after the modification. This standard is effective for fiscal years, and interim periods within those fiscal years, beginning after Dec. 15, 2017. Adoption will be applied prospectively to awards modified on or after the adoption date. Accordingly, Monsanto is required to adopt this standard in the first quarter of fiscal year 2019. The company is currently evaluating the impact this guidance will have on the consolidated financial statements and related disclosures. In February 2017, the FASB issued accounting guidance, “Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost” which requires the disaggregation of the service cost component from other components of net periodic benefit cost, clarifies how to present the service cost component and other components of net benefit costs in the Statements of Consolidated Operations and allows only the service cost component of net benefit costs to be eligible for capitalization. This standard is effective for fiscal years, and interim periods within those fiscal years, beginning after Dec. 15, 2017, with early adoption permitted as of the beginning of a fiscal year for which interim or annual statements have not been issued. Adoption will be applied on a retrospective basis for the presentation of all components of net periodic benefit costs and on a prospective basis for the capitalization of the service cost component of net periodic pension cost and net periodic postretirement benefit in assets. Accordingly, Monsanto is required to adopt this standard in the first quarter of fiscal year 2019. The company is currently evaluating the impact this guidance will have on the consolidated financial statements and related disclosures. In February 2017, the FASB issued accounting guidance, “Clarifying the Scope of Asset Derecognition Guidance and Accounting for Partial Sale of Nonfinancial Assets” which clarifies the scope of transactions that are accounted for in accordance with the Other Income topic of the ASC as well as when these assets would be derecognized. The Other Income topic of the ASC applies to a sale or transfer to a non-customer of nonfinancial assets or financial assets in a contract with substantially all of the fair value concentrated in nonfinancial assets. This standard is effective for fiscal years, and interim periods within those fiscal years, beginning after Dec. 15, 2017, with an early adoption of one-year permitted. This guidance is required to be adopted at the same time “Revenue from Contracts with Customers” is adopted. Entities have the option to apply the new guidance under a retrospective approach to each prior reporting period presented or a modified retrospective approach with the cumulative effect of initially applying the new guidance recognized at the date of initial application within the Statement of Consolidated Financial Position. The method of adoption elected may be different than the method of adoption for “Revenue from Contracts with Customers.” Monsanto is required to adopt this standard in the first quarter of fiscal year 2019. The company is currently evaluating the impact this guidance will have on the consolidated financial statements and related disclosures. In January 2017, the FASB issued accounting guidance, “Simplifying the Test for Goodwill Impairment” which would eliminate the requirement to calculate the implied fair value of goodwill to measure a goodwill impairment charge. Instead, the amount of an impairment charge would be recognized if the carrying amount of a reporting unit is greater than its fair value. This standard is effective for annual or any interim goodwill impairments tests in fiscal years beginning after Dec. 15, 2019, with early adoption permitted. Adoption will be applied on a prospective basis. Monsanto is required to adopt this standard in the first quarter of fiscal year 2021. The company is currently evaluating the impact this guidance will have on the consolidated financial statements and related disclosures. In January 2017, the FASB issued accounting guidance, “Clarifying the Definition of a Business” which requires an evaluation of whether substantially all fair value of the assets acquired or disposed of is concentrated in a single identifiable asset or a group of similar identifiable assets. If this threshold is met, the set of transferred assets and activities is not a business. The guidance also requires a business to include at least one substantive process. Transactions that meet the definition of a business are expected to decrease as a result of the adoption of this guidance. This standard is effective for fiscal years, and interim periods within those fiscal years, beginning after Dec. 15, 2017, with early adoption permitted. Adoption will be applied on a prospective basis. Monsanto is required to adopt this standard in the first quarter of fiscal year 2019. The company is currently evaluating the impact this guidance will have on the consolidated financial statements and related disclosures. In November 2016, the FASB issued accounting guidance, “Statement of Cash Flows: Restricted Cash” which requires restricted cash and restricted cash equivalents to be classified in the Statements of Cash Flows as cash and cash equivalents. This standard is effective for fiscal years, and interim periods within those fiscal years, beginning after Dec. 15, 2017, with early adoption permitted. Adoption will be applied on a retrospective basis to all periods presented. Monsanto is required to adopt this standard in the first quarter of fiscal year 2019. The company is currently evaluating the impact this guidance will have on the consolidated financial statements and related disclosures. In October 2016, the FASB issued accounting guidance, “Income Taxes: Intra-Entity Transfers of Assets Other than Inventory” which will require the income tax effects of intra-entity transfers of assets other than inventory to be recognized when the transfer occurs. This standard is effective for fiscal years, and interim periods within those fiscal years, beginning after Dec. 15, 2017, with early adoption permitted as of the beginning of an annual period. Adoption will be applied on a modified retrospective basis. Monsanto is required to adopt the standard in the first quarter of fiscal year 2019. The company is currently evaluating the impact this guidance will have on the consolidated financial statements and related disclosures. In August 2016, the FASB issued accounting guidance, “Classification of Certain Cash Receipts and Cash Payments” which clarifies the classification of the activity in the Statements of Consolidated Cash Flows and how the predominant principle should be applied when cash receipts and cash payments have more than one class of cash flows. This standard is effective for fiscal years, and interim periods within those fiscal years, beginning after Dec. 15, 2017, with early adoption permitted. Adoption will be applied retrospectively. Monsanto is required to adopt the standard in the first quarter of fiscal year 2019. The company is currently evaluating the impact this guidance will have on the consolidated financial statements and related disclosures. In June 2016, the FASB issued accounting guidance, “Measurement of Credit Losses on Financial Instruments” which replaces the incurred loss methodology to record credit losses with a methodology that reflects the expected credit losses for financial assets not accounted for at fair value with gains and losses recognized through net income. This standard is effective for fiscal years, and interim periods within those fiscal years, beginning after Dec. 15, 2019, with early adoption permitted for fiscal years, and interim periods within those fiscal years, beginning after Dec. 15, 2018. This standard will be adopted on a modified retrospective basis. Monsanto is required to adopt this standard in the first quarter of fiscal year 2021, with early adoption permitted in the first quarter of fiscal year 2020. The company is currently evaluating the impact this guidance will have on the consolidated financial statements and related disclosures. In February 2016, the FASB issued accounting guidance, “Leases”, which has been further clarified and amended. This guidance will supersede the existing lease guidance and will require all leases with a term greater than 12 months to be recognized in the Statements of Financial Position and eliminate current real estate-specific lease guidance, while maintaining substantially similar classification criteria for distinguishing between finance leases and operating leases. This standard is effective for fiscal years, and interim periods within those fiscal years, beginning after Dec. 15, 2018, with early adoption permitted. This standard will be adopted on a modified retrospective basis. Monsanto is required to adopt the standard in the first quarter of fiscal year 2020. The company is currently evaluating the impact this guidance will have on the consolidated financial statements and related disclosures. In January 2016, the FASB issued accounting guidance, “Recognition and Measurement of Financial Assets and Financial Liabilities” which would require equity investments not accounted for as an equity method investment or that result in consolidation to be recorded at their fair value with changes in fair value recognized in the Statements of Consolidated Operations. Those equity investments that do not have a readily determinable fair value may be measured at cost less impairment, if any, plus or minus changes resulting from observable price changes. In February 2018, the FASB issued guidance amending the previous guidance to clarify that entities must use a prospective transition approach for equity securities they elect to measure using the new measurement alternative. The amendments also clarify other aspects of the guidance on how to apply the measurement alternative and the presentation requirements for financial liabilities measured under the fair value option. This standard, including the clarifications, is effective for fiscal years, and interim periods within those fiscal years, beginning after Dec. 15, 2017, with early adoption prohibited. Monsanto is required to adopt the standard in the first quarter of fiscal year 2019. The company is currently evaluating the impact this guidance will have on the consolidated financial statements and related disclosures. In May 2014, the FASB issued accounting guidance, “Revenue from Contracts with Customers” which has been further clarified and amended. The core principle of the new standard is for companies to recognize revenue to depict the transfer of goods or services to customers in amounts that reflect the consideration (that is, payment) to which the company expects to be entitled in exchange for those goods or services. The new standard also will result in enhanced disclosures about revenue, provide guidance for transactions that were not previously addressed comprehensively (for example, service revenue and contract modifications) and clarify guidance for multiple-element arrangements. Entities have the option to apply the new guidance under a retrospective approach to each prior reporting period presented or a modified retrospective approach with the cumulative effect of initially applying the new guidance recognized at the date of initial application within the Statement of Consolidated Financial Position. In August 2015, the FASB amended the guidance to allow for the deferral of the effective date of this standard. The standard is effective for fiscal years, and interim periods within those years, beginning after Dec. 15, 2017. Accordingly, Monsanto is required to adopt this standard in the first quarter of fiscal year 2019. One-year early adoption is permitted. The initial analysis identifying areas that will be impacted by the new guidance is substantially complete, and the company is currently analyzing the potential impacts to the consolidated financial statements and related disclosures. Revenue from seed sales, agricultural chemical products and biotechnology trait licenses recognized as third-party seed companies sell seed is expected to remain substantially unchanged. The company believes the most significant impact relates to its accounting for biotechnology trait license revenue with fixed payments. Specifically, under the new standard, revenue for biotechnology trait licenses with fixed payments are expected to be recognized upon commencement of the license term rather than over the contract period. Due to complexities of certain biotechnology trait license agreements, the actual revenue recognition treatment under the standard will be dependent upon contract-specific terms and may vary in some instances from recognition upon commencement of the license term. Upon adoption, the company may recognize a cumulative material adjustment to increase retained earnings, reflecting license revenue for which the contract period has not yet finished. The company does not expect the adoption of this standard to have an impact on the cash flows related to these license agreements. The company anticipates utilizing the modified retrospective method for adopting the standard. |
RESTRUCTURING
RESTRUCTURING | 30 Months Ended |
Feb. 28, 2018 | |
Restructuring and Related Activities [Abstract] | |
RESTRUCTURING | NOTE 3. RESTRUCTURING Restructuring charges were recorded in the Statements of Consolidated Operations as follows: Three Months Ended Six Months Ended (Dollars in millions) Feb. 28, 2018 Feb. 28, 2017 Feb. 28, 2018 Feb. 28, 2017 Cost of Goods Sold (1) $ (4 ) $ (6 ) $ (17 ) $ (7 ) Restructuring Charges (2) 1 (23 ) (3 ) 13 Income from Continuing Operations Before Income Taxes $ (3 ) $ (29 ) $ (20 ) $ 6 Income Tax Provision 15 15 23 5 Net Income $ 12 $ (14 ) $ 3 $ 11 (1) For the three months ended Feb. 28, 2018 , $4 million of restructuring charges in cost of goods sold was recorded in the Agricultural Productivity segment. For the three months ended Feb. 28, 2017, $6 million of restructuring charges in cost of goods sold was split by segment as follows: $5 million in Seeds and Genomics and $1 million in Agricultural Productivity. For the six months ended Feb. 28, 2018, $17 million of restructuring charges in cost of goods sold was split by segment as follows: $10 million in Seeds and Genomics and $7 million in Agricultural Productivity. For the six months ended Feb. 28, 2017, $7 million of restructuring charges in cost of goods sold was split by segment as follows: $6 million in Seeds and Genomics and $1 million in Agricultural Productivity. (2) For the three months ended Feb. 28, 2018 , the net reversal of previously recognized expense of $1 million was recorded in the Seeds and Genomics segment. For the three months ended Feb. 28, 2017, $23 million of restructuring charges was split by segment as follows: $22 million in Seeds and Genomics and $1 million in Agricultural Productivity. For the six months ended Feb. 28, 2018, $3 million of restructuring charges was split by segment as follows: $2 million in Seeds and Genomics and $1 million in Agricultural Productivity. For the six months ended Feb. 28, 2017, the net reversal of previously recognized expense of $13 million was split by segment as follows: $12 million in Seeds and Genomics and $1 million in Agricultural Productivity. On Oct. 6, 2015, the company approved actions to realign resources to increase productivity, enhance competitiveness by delivering cost improvements and support long-term growth. On Jan. 5, 2016, the company approved additional actions which, together with the Oct. 6, 2015 actions, comprise the 2015 Restructuring Plan. Actions include streamlining and reprioritizing some commercial, enabling, supply chain and research and development efforts. Cumulative pretax charges related to the 2015 Restructuring Plan are estimated to be in the range of $890 million to $955 million . Implementation of the 2015 Restructuring Plan is expected to be completed by the end of fiscal year 2018, and substantially all of the cash payments are expected to be made by the end of fiscal year 2018. These pretax charges are currently estimated to be comprised of the following categories: $315 million to $325 million in work force reductions, including severance and related benefits; $95 million to $130 million in facility closures/exit costs, including contract termination costs; $480 million to $500 million in asset impairments and write-offs related to property, plant and equipment, inventory and goodwill and other assets. These pretax charges are currently estimated to be incurred primarily by the Seeds and Genomics segment. The following tables summarize the activities related to the company’s 2015 Restructuring Plan. Three months ended Feb. 28, 2018 Three months ended Feb. 28, 2017 (Dollars in millions) Seeds and Genomics Agricultural Productivity Total Seeds and Agricultural Total Work Force Reductions $ (6 ) $ (1 ) $ (7 ) $ 2 $ — $ 2 Facility Closures/Exit Costs 5 5 10 8 1 9 Asset Impairments and Write-offs: Property, plant and equipment — — — 18 1 19 Inventory — — — (1 ) — (1 ) Goodwill and other assets — — — — — — Total Restructuring Charges, Net $ (1 ) $ 4 $ 3 $ 27 $ 2 $ 29 Six months ended Feb. 28, 2018 Six months ended Feb. 28, 2017 Cumulative Amount through Feb. 28, 2018 (Dollars in millions) Seeds and Genomics Agricultural Productivity Total Seeds and Agricultural Total Seeds and Agricultural Total Work Force Reductions $ (10 ) $ (1 ) $ (11 ) $ (34 ) $ (2 ) $ (36 ) $ 297 $ 17 $ 314 Facility Closures/Exit Costs 20 9 29 10 1 11 62 19 81 Asset Impairments and Write-offs: Property, plant and equipment — — — 19 1 20 153 3 156 Inventory 2 — 2 — — — 106 — 106 Goodwill and other assets — — — (1 ) — (1 ) 189 20 209 Total Restructuring Charges, Net $ 12 $ 8 $ 20 $ (6 ) $ — $ (6 ) $ 807 $ 59 $ 866 The company’s written human resource policies are indicative of an ongoing benefit arrangement with respect to severance packages. Benefits paid pursuant to an ongoing benefit arrangement are specifically excluded from the Exit or Disposal Cost Obligations topic of the ASC; therefore, severance charges incurred in connection with the 2015 Restructuring Plan are accounted for when probable and estimable as required under the Compensation - Nonretirement Postemployment Benefits topic of the ASC. In addition, when the decision to commit to a restructuring plan requires a long-lived asset and finite-lived intangible asset impairment review, Monsanto evaluates such impairment issues under the Property, Plant and Equipment topic of the ASC. The three months ended Feb. 28, 2018, and Feb. 28, 2017, include the reversal of $8 million and $12 million , respectively, of previously recognized expense due to changes in estimates related to work force reductions. The six months ended Feb. 28, 2018, and Feb. 28, 2017, include the reversal of $14 million and $57 million , respectively, of previously recognized expense due to changes in estimates related to work force reductions. The following table summarizes the activities related to the company’s 2015 Restructuring Plan. (Dollars in millions) Work Force Reductions (1) Facility Closures/Exit Costs (2) Asset Impairments and Write-offs Total Ending Liability as of Aug. 31, 2016 $ 244 $ — $ — $ 244 Net restructuring charges recognized in fiscal year 2017 (81 ) 24 46 (11 ) Cash payments (119 ) (22 ) — (141 ) Asset impairments and write-offs — — (46 ) (46 ) Ending Liability as of Aug. 31, 2017 $ 44 $ 2 $ — $ 46 Net restructuring charges recognized in first six months of fiscal year 2018 (11 ) 29 2 20 Cash payments (17 ) (29 ) — (46 ) Asset impairments and write-offs — — (2 ) (2 ) Ending Liability as of Feb. 28, 2018 $ 16 $ 2 $ — $ 18 (1) There was no long-term restructuring liability balance as of Feb. 28, 2018. The restructuring liability balance included $8 million of long-term liabilities that was recorded in other liabilities in the Statement of Consolidated Financial Position as of Aug. 31, 2017 . (2) There was no long-term restructuring liability balance as of Feb. 28, 2018. The restructuring liability balance included $1 million of long-term liabilities that was recorded in other liabilities in the Statement of Consolidated Financial Position as of Aug. 31, 2017. |
CUSTOMER FINANCING PROGRAMS
CUSTOMER FINANCING PROGRAMS | 6 Months Ended |
Feb. 28, 2018 | |
CUSTOMER FINANCING PROGRAMS [Abstract] | |
CUSTOMER FINANCING PROGRAMS | CUSTOMER FINANCING PROGRAMS 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. In addition to the arrangements in the above table, Monsanto also participates in a financing program in Brazil that allows Monsanto to transfer up to 350 million Brazilian reais (approximately $108 million as of Feb. 28, 2018 ) for select customers in Brazil to a revolving financing program. Under the arrangement, a recourse provision requires Monsanto to cover the first credit losses within the program up to the amount of the company’s investment. Credit losses above Monsanto’s investment would be covered by senior interests in the entity by a reduction in the fair value of their mandatorily redeemable shares. The company evaluated its relationship with the entity under the guidance within the Consolidation topic of the ASC, and as a result, the entity has been consolidated. For further information on this topic, see Note 5 — Variable Interest Entities and Investments . There were no significant recourse or non-recourse liabilities for all programs as of Feb. 28, 2018 , and Aug. 31, 2017 . There were no significant delinquent loans for all programs as of Feb. 28, 2018 , and Aug. 31, 2017 . |
VARIABLE INTEREST ENTITIES
VARIABLE INTEREST ENTITIES | 6 Months Ended |
Feb. 28, 2018 | |
Equity Method Investments and Joint Ventures [Abstract] | |
VARIABLE INTEREST ENTITIES | VARIABLE INTEREST ENTITIES AND INVESTMENTS Variable Interest Entities On Nov. 4, 2016, Monsanto entered into a financing program in Brazil that is recorded as a consolidated variable interest entity (“VIE”). For the most part, the arrangement of the Brazil VIE consists of a revolving financing program that is funded by investments from the company and other third parties, primarily investment funds, and has been established to service Monsanto’s customer receivables. Under the arrangement, third parties, primarily investment funds, hold senior interests of 80 percent and 85 percent in the entity as of Feb. 28, 2018 , and Aug. 31, 2017 , respectively, and Monsanto holds the remaining 20 percent and 15 percent , respectively. The senior interests held by third parties are mandatorily redeemable shares and are primarily included in long-term debt in the Statements of Consolidated Financial Position as of Feb. 28, 2018 , and Aug. 31, 2017 , respectively. Under the arrangement, Monsanto is required to maintain an investment in the Brazil VIE of at least 11.1 percent and could be required to provide additional contributions to the Brazil VIE. Monsanto currently has no unfunded commitments to the Brazil VIE. Creditors have no recourse against Monsanto in the event of default by the Brazil VIE. The company’s financial or other support provided to the Brazil VIE is limited to its investment. Even though Monsanto holds a subordinate interest in the Brazil VIE, the Brazil VIE was established to service transactions involving the company, and the company determines the receivables that are included in the revolving financing program. Therefore, the determination is that Monsanto has the power to direct the activities most significant to the economic performance of the Brazil VIE. As a result, the company is the primary beneficiary of the Brazil VIE, and the Brazil VIE has been consolidated in Monsanto’s consolidated financial statements. The assets of the Brazil VIE may only be used to settle the obligations of the respective entity. Third-party investors in the Brazil VIE do not have recourse to the general assets of Monsanto. See Note 4 — Customer Financing Programs and Note 12 — Fair Value Measurements — for additional information. Monsanto has entered into an agreement with a third party to establish an entity to focus on research and development (“R&D”) related to agricultural fungicides for agricultural applications. This entity is recorded as a consolidated VIE of Monsanto. Under the arrangement, Monsanto holds a call option to acquire the majority of the equity interests in the R&D VIE from the third-party owner. Monsanto funds the operations of the R&D VIE in return for additional equity interests or to retain the call option. The funding is provided in separate research phases if research milestones are met. The R&D VIE was established to perform agricultural-based R&D activities for the benefit of Monsanto, and Monsanto provides all funding of the R&D VIE’s activities. Further, Monsanto has the power to direct the activities most significant to the R&D VIE. As a result, Monsanto is the primary beneficiary of the R&D VIE, and the R&D VIE is consolidated in Monsanto’s consolidated financial statements. The third-party owner of the R&D VIE does not have recourse to the general assets of Monsanto beyond Monsanto’s maximum exposure to loss at any given time relating to the R&D VIE. Monsanto has an agreement with a related party to establish an entity to focus on research, development and commercialization of insect resistant hybrid cotton in India. This entity is recorded as a consolidated VIE of Monsanto. Under the arrangement, Monsanto performs substantially all of the VIE’s activities, which are reimbursed by the VIE. Further, since this entity was formed with a Monsanto related party, it was determined that Monsanto is most closely associated with the VIE. As a result, Monsanto is the primary beneficiary of the VIE, and the VIE is consolidated in Monsanto’s consolidated financial statements. The related-party owner of the VIE does not have recourse to the general assets of Monsanto beyond Monsanto’s maximum exposure to loss at any given time relating to the VIE, unless Monsanto is required to indemnify the related-party owner as a result of a third-party claim for injury to a person or damage to property caused by Monsanto’s activities as it relates to the VIE. Monsanto enters into agreements with agents and dealers to distribute certain branded seed in the United States. Monsanto offers financing to agents and dealers that constitutes a variable interest as it exposes Monsanto to variability of the agent or dealer. Certain agents and dealers with these financing arrangements have been determined to be VIEs. Monsanto does not consolidate the agents or dealers as Monsanto is not the primary beneficiary, and any exposure to loss is limited to the amount of financing provided to the agent or dealer. The amount of Monsanto’s exposure varies based on the seasonality of the business and was approximately $25 million and less than $1 million as of Feb. 28, 2018 , and Aug. 31, 2017 , respectively. Monsanto enters into agreements with distributors and dealers to distribute certain branded seed in the United States. Monsanto offers distributors and dealers the right of return that exposes Monsanto to variability and constitutes a variable interest in certain distributors and dealers. Certain distributors and dealers with these arrangements have been determined to be VIEs. Monsanto does not consolidate the distributors and dealers with these arrangements as Monsanto is not the primary beneficiary, and any exposure to loss is limited to the amount of the variable interest in the entity. In fiscal 2017, Monsanto entered into an agreement with a third party to establish an entity to focus on the sale of industrial, ornamental, and turf non-selective agricultural herbicides. Monsanto has provided an uncustomary indemnification to the third party that provides Monsanto the option under specified conditions to dissolve the entity, terminate all commercial agreements of the entity or receive all interest in the entity. Monsanto has determined the entity to be a VIE. Monsanto does not consolidate the entity as Monsanto is not the primary beneficiary. The amount of Monsanto’s exposure to loss related to the uncustomary indemnification is limited to approximately $29 million as of Feb. 28, 2018 , and Aug. 31, 2017. Additionally, Monsanto has provided an indemnification to the third party and newly formed legal entity related to specified product claims. The amount of Monsanto’s exposure varies based upon the third party and newly formed legal entity’s losses related to such product claims and is not material as of Feb. 28, 2018 , and Aug. 31, 2017. Equity Method and Cost Basis Investments Monsanto has equity method and cost basis investments recorded in other assets in the Statements of Consolidated Financial Position. Due to the nature of the cost basis investments, the fair market value is not readily determinable. These investments are reviewed for impairment indicators on a quarterly basis. For such investments that were accounted for under the equity method and cost basis included in other assets in the Statements of Consolidated Financial Position, the amounts are summarized in the following table: As of (Dollars in millions) Feb. 28, 2018 Aug. 31, 2017 Equity Method Investments $ 163 $ 166 Cost Basis Investments 124 116 Total $ 287 $ 282 |
RECEIVABLES
RECEIVABLES | 6 Months Ended |
Feb. 28, 2018 | |
Receivables [Abstract] | |
RECEIVABLES | RECEIVABLES Trade receivables in the Statements of Consolidated Financial Position are net of allowances of $89 million and $78 million as of Feb. 28, 2018 , and Aug. 31, 2017 , respectively. The company has long-term customer financing receivables that relate to past due accounts which are not expected to be collected within the current year. The long-term customer receivables were $338 million and $398 million with a corresponding allowance for credit losses on these receivables of $280 million and $277 million as of Feb. 28, 2018 , and Aug. 31, 2017 , respectively. These long-term customer receivable balances and the corresponding allowance are included in long-term receivables, net in the Statements of Consolidated Financial Position. For these long-term customer receivables, interest is no longer accrued when the receivable is determined to be delinquent and classified as long-term based on estimated timing of collection. The following table displays a roll forward of the allowance for credit losses related to long-term customer receivables. (Dollars in millions) Balance as of Aug. 31, 2016 $ 228 Incremental provision 20 Recoveries (38 ) Write-offs (2 ) Reclassifications from allowance for current receivables 67 Foreign currency translation adjustments 2 Balance as of Aug. 31, 2017 $ 277 Incremental provision 7 Recoveries (1 ) Reclassifications from allowance for current receivables 1 Foreign currency translation adjustments (4 ) Balance as of Feb. 28, 2018 $ 280 On an ongoing basis, the company evaluates credit quality of its financing receivables utilizing aging of receivables, collection experience and write-offs, as well as evaluating existing economic conditions, to determine if an allowance is necessary. |
INVENTORY
INVENTORY | 6 Months Ended |
Feb. 28, 2018 | |
Inventory Disclosure [Abstract] | |
INVENTORY | INVENTORY Components of inventory are: As of (Dollars in millions) Feb. 28, 2018 Aug. 31, 2017 Finished Goods $ 1,964 $ 1,477 Goods In Process 1,466 1,446 Raw Materials and Supplies 743 561 Total 4,173 3,484 Adjustment of Inventories to a LIFO Basis (1) (158 ) (144 ) Total Inventories $ 4,015 $ 3,340 (1) Adjustment is for the United States Agricultural Productivity segment inventories. |
GOODWILL AND OTHER INTANGIBLE A
GOODWILL AND OTHER INTANGIBLE ASSETS | 6 Months Ended |
Feb. 28, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
GOODWILL AND OTHER INTANGIBLE ASSETS | GOODWILL AND OTHER INTANGIBLE ASSETS Changes in the net carrying amount of goodwill for the first six months of fiscal year 2018 , by segment, are as follows: (Dollars in millions) Seeds and Genomics Agricultural Productivity Total Balance as of Aug. 31, 2017 $ 4,039 $ 49 $ 4,088 Effect of foreign currency translation and other adjustments 12 — 12 Balance as of Feb. 28, 2018 $ 4,051 $ 49 $ 4,100 There were no events or circumstances indicating that goodwill might be impaired as of Feb. 28, 2018 . The fiscal year 2018 annual goodwill impairment test will be performed as of Mar. 1, 2018. Information regarding the company’s other intangible assets is as follows: As of Feb. 28, 2018 As of Aug. 31, 2017 (Dollars in millions) Carrying Amount Accumulated Amortization Net Carrying Amount Accumulated Amortization Net Acquired Germplasm $ 1,080 $ (827 ) $ 253 $ 1,077 $ (814 ) $ 263 Acquired Intellectual Property 1,079 (700 ) 379 1,079 (671 ) 408 Trademarks 336 (171 ) 165 335 (165 ) 170 Customer Relationships 293 (237 ) 56 291 (228 ) 63 Other 75 (44 ) 31 68 (40 ) 28 Total Other Intangible Assets, Finite Lives $ 2,863 $ (1,979 ) $ 884 $ 2,850 $ (1,918 ) $ 932 In Process Research & Development, Indefinite Lives 93 — 93 92 — 92 Total Other Intangible Assets $ 2,956 $ (1,979 ) $ 977 $ 2,942 $ (1,918 ) $ 1,024 Total amortization expense of total other intangible assets was $31 million and $28 million for the three months ended Feb. 28, 2018 , and Feb. 28, 2017 , respectively, and $54 million and $58 million for the six months ended Feb. 28, 2018 , and Feb. 28, 2017 , respectively. The estimated intangible asset amortization expense for fiscal year 2018 through fiscal year 2022 is as follows: (Dollars in millions) Amount 2018 $ 111 2019 111 2020 110 2021 108 2022 103 |
DEFERRED REVENUE (Notes)
DEFERRED REVENUE (Notes) | 6 Months Ended |
Feb. 28, 2018 | |
Revenue Recognition and Deferred Revenue [Abstract] | |
Deferred Revenue Disclosure [Text Block] | NOTE 9. DEFERRED REVENUE As of Feb. 28, 2018, and Aug. 31, 2017, short-term deferred revenue was $1,686 million and $727 million , respectively. These balances primarily consist of cash received related to Monsanto’s prepayment programs in the United States and Brazil. These programs allow Monsanto’s customers to receive a discount if they prepay by a certain date, and the short-term deferred revenue balances are consistent with the seasonality of Monsanto’s business. Prepayment options are attractive to customers given the discounted pricing and the ability to utilize cash flow from the current year grain harvest to pay for the next season seed purchases. The deferred revenue balances related to these prepayment programs are considered short-term in nature and thus classified in current liabilities as the prepayments are for products to be shipped within the next 12 months. |
INCOME TAXES
INCOME TAXES | 6 Months Ended |
Feb. 28, 2018 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES On Dec. 22, 2017, the United States enacted tax legislation, commonly known as the Tax Cuts and Jobs Act (the “Act”). Among other provisions, the Act lowered the corporate tax rate from 35% to 21% beginning on Jan. 1, 2018, and imposed a new tax (the “Transition Tax”) on certain earnings outside the United States that have previously not been subject to United States tax, which may be paid beginning in fiscal 2019 through fiscal 2026. The Securities and Exchange Commission (“SEC”) staff issued Staff Accounting Bulletin 118 (“SAB 118”), which provides guidance on accounting for the tax effects of the Act. SAB 118 provides a measurement period that should not extend beyond one year from the enactment date for companies to complete the accounting for the effects of the Act. Per SAB 118, a company must reflect the income tax effects of those aspects of the Act for which the accounting is complete. To the extent a company’s accounting for certain income tax effects of the Act is incomplete but it can determine a reasonable estimate, the company must record a provisional estimate in its financial statements. The company is still in the process of evaluating the impact the Act will have on the consolidated financial statements. However, for the six months ended Feb. 28, 2018, the company has included the following provisional estimates in its income tax provision: • The company provisionally recorded a discrete tax benefit of $165 million for the impact of remeasuring its U.S. deferred tax assets and liabilities to the 21% corporate tax rate. Since the Jan. 1, 2018, effective date of the reduction of the corporate tax rate from 35% to 21% is during the company’s fiscal year, the company must utilize a blended tax rate of 25.7% for fiscal 2018. The 21% tax rate will be applied to subsequent fiscal years. To revalue its deferred tax assets and liabilities, the company estimated the change in its deferred tax assets and liabilities that would occur in fiscal 2018 and adjusted that portion of the deferred balances to 25.7% and adjusted the remaining deferred balances to 21%. These estimates of changes in deferred tax assets and liabilities are provisional as they are all subject to refinement based on the actual change in deferred taxes during fiscal 2018. • The company provisionally recorded a discrete tax expense of $168 million for the Transition Tax, which includes $3 million of U.S. state tax. The remaining Transition Tax can be fully offset by the company’s foreign tax credits; therefore, the company does not expect a significant cash outlay for this tax. The Transition Tax segregates the untaxed foreign earnings between those that are held in cash and cash equivalents and those that are not and taxes these two subgroups at different tax rates. Further, these calculations utilize several dates to measure these components. The company is in the process of determining the earnings or cash balances as of each of the dates required by the Act, one of which is at the end of fiscal 2018. Furthermore, interpretive guidance could be forthcoming that may clarify various components of the legislation that would impact certain components of the calculation. Therefore, the estimated Transition Tax is provisional. • The company has provisionally not recorded any discrete tax expense associated with the excess of its basis in its foreign affiliates for financial reporting over the related tax basis for potential future repatriations of its undistributed foreign earnings. Certain undistributed earnings are subject to the Transition Tax. These earnings could also be subject to additional foreign withholding and U.S. state income taxes if they are repatriated. The company is currently evaluating the potential income tax liabilities that would result from future repatriations, if any, and how the Act will affect its existing accounting position regarding the indefinite reinvestment of these undistributed foreign earnings. • The company has provisionally not recorded any discrete tax expense associated with the Act’s new global intangible low-taxed income (“GILTI”) provisions. These provisions apply to the company beginning in fiscal 2019. However, the company must adopt an accounting policy to either treat taxes related to GILTI as a current-period expense when incurred or factor such amounts into the company’s measurement of its deferred taxes. Because of the complexity of the new GILTI tax rules and the possibility of forthcoming interpretive guidance, the company is still evaluating these provisions and has not yet adopted an accounting policy related to the potential taxes resulting from these provisions. Aside from the net $3 million tax expense from the above discrete tax adjustments resulting from the Act, the company recorded a net $47 million discrete tax benefit for various other adjustments, resulting in a total discrete tax benefit of $44 million for the six months ended Feb. 28, 2018. |
DEBT AND OTHER CREDIT ARRANGEME
DEBT AND OTHER CREDIT ARRANGEMENTS | 6 Months Ended |
Feb. 28, 2018 | |
Debt Disclosure [Abstract] | |
DEBT AND OTHER CREDIT ARRANGEMENTS | DEBT AND OTHER CREDIT ARRANGEMENTS In April 2016, Monsanto filed a shelf registration with the SEC (“2016 shelf registration”) that allows the company to issue a maximum aggregate amount of $6 billion of debt, equity and hybrid offerings. The 2016 shelf registration expires in April 2019. Monsanto has a $3 billion credit facility agreement that provides a senior unsecured revolving credit facility through Mar. 27, 2020. As of Feb. 28, 2018 , Monsanto was in compliance with all debt covenants, and there were no outstanding borrowings under this credit facility. Monsanto’s short-term debt instruments include the current portion of long-term debt, notes payable to banks and borrowings under the delayed draw term loan facility. As of Feb. 28, 2018 , and Aug. 31, 2017 , Monsanto did not have any commercial paper outstanding. Additionally, as of Feb. 28, 2018 , and Aug. 31, 2017 , the mandatorily redeemable shares of the Brazil VIE were classified primarily as long-term debt instruments. See Note 5 — Variable Interest Entities and Investments — for additional information. In October 2016, Monsanto entered into a $1 billion delayed draw term loan facility that matures the earlier of October 2019 or the consummation of the Merger with Bayer. Borrowings under the facility were $500 million as of Feb. 28, 2018 , and Aug. 31, 2017 . Proceeds were used for general corporate purposes. On Jan. 29, 2018, Monsanto redeemed all $365 million of the 4.30% Notes, due Jan. 29, 2045. The fair value of total short-term debt was $1,212 million and $877 million as of Feb. 28, 2018 , and Aug. 31, 2017 , respectively. The fair value of the total long-term debt was $6,750 million and $7,603 million as of Feb. 28, 2018 , and Aug. 31, 2017 , respectively. See Note 12 — Fair Value Measurements — for additional information. |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 6 Months Ended |
Feb. 28, 2018 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | FAIR VALUE MEASUREMENTS Monsanto determines the fair market value of its financial assets and liabilities based on quoted market prices, estimates from brokers and other appropriate valuation techniques. The company uses the fair value hierarchy established in the Fair Value Measurements and Disclosures topic of the ASC, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The hierarchy contains three levels as follows, with Level 3 representing the lowest level of input. Level 1 — Values based on unadjusted quoted market prices in active markets that are accessible at the measurement date for identical assets and liabilities. Level 2 — Values based on quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, discounted cash flow models, or other model-based valuation techniques adjusted, as necessary, for credit risk. Level 3 — Values generated from model-based techniques that use significant assumptions not observable in the market. These unobservable assumptions would reflect our own estimates of assumptions that market participants would use in pricing the asset or liability. Valuation techniques could include use of option pricing models, discounted cash flow models and similar techniques. The following tables set forth by level Monsanto’s assets and liabilities disclosed at fair value on a recurring basis as of Feb. 28, 2018 , and Aug. 31, 2017 . As required by the Fair Value Measurements and Disclosures topic of the ASC, assets and liabilities are classified in their entirety based on the lowest level of input that is a significant component of the fair value measurement. Monsanto’s assessment of the significance of a particular input to the fair value measurement requires judgment and may affect the classification of fair value assets and liabilities within the fair value hierarchy levels. Fair Value Measurements at Feb. 28, 2018, Using (Dollars in millions) Level 1 Level 2 Level 3 Net Balance Assets at Fair Value: Cash equivalents $ 2,150 $ — $ — $ 2,150 Short-term investments 5 — — 5 Equity securities 6 — — 6 Derivative assets related to: Foreign currency contracts — 3 — 3 Commodity contracts 18 9 — 27 Total Assets at Fair Value $ 2,179 $ 12 $ — $ 2,191 Liabilities at Fair Value: Short-term debt instruments (1) $ — $ 1,210 $ 2 $ 1,212 Long-term debt instruments (1) — 6,653 97 6,750 Derivative liabilities related to: Foreign currency contracts — 15 — 15 Commodity contracts 9 7 — 16 Total Liabilities at Fair Value $ 9 $ 7,885 $ 99 $ 7,993 (1) Debt instruments, excluding mandatorily redeemable shares, are not recorded at fair value on a recurring basis; however, they are measured at fair value for disclosure purposes, as required by the Fair Value Measurements and Disclosures topic of the ASC. Fair Value Measurements at Aug. 31, 2017, Using (Dollars in millions) Level 1 Level 2 Level 3 Net Balance Assets at Fair Value: Cash equivalents $ 1,034 $ — $ — $ 1,034 Short-term investments 8 — — 8 Equity securities 10 — — 10 Derivative assets related to: Foreign currency contracts — 10 — 10 Commodity contracts 3 7 — 10 Total Assets at Fair Value $ 1,055 $ 17 $ — $ 1,072 Liabilities at Fair Value: Short-term debt instruments (1) $ — $ 877 $ — $ 877 Long-term debt instruments (1) — 7,499 104 7,603 Derivative liabilities related to: Foreign currency contracts — 16 — 16 Commodity contracts 7 6 — 13 Total Liabilities at Fair Value $ 7 $ 8,398 $ 104 $ 8,509 (1) Debt instruments, excluding mandatorily redeemable shares, are not recorded at fair value on a recurring basis; however, they are measured at fair value for disclosure purposes, as required by the Fair Value Measurements and Disclosures topic of the ASC. The company’s derivative contracts are measured at fair value, including forward commodity purchase and sale contracts, exchange-traded commodity futures and option contracts and over-the-counter (“OTC”) instruments related primarily to agricultural commodities, energy and raw materials, interest rates and foreign currencies. Exchange-traded futures and options contracts are valued based on unadjusted quoted prices in active markets and are classified as Level 1. Fair value for forward commodity purchase and sale contracts is estimated based on exchange-quoted prices adjusted for differences in local markets. These differences are generally determined using inputs from broker or dealer quotations or market transactions in either the listed or OTC markets and are classified as Level 2. Interest rate contracts consist of interest rate swaps measured using broker or dealer quoted prices. When observable inputs are available for substantially the full term of the contract, it is classified as Level 2. Based on historical experience with the company’s suppliers and customers, the company’s own credit risk and knowledge of current market conditions, the company does not view nonperformance risk to be a significant input to the fair value for the majority of its forward commodity purchase and sale contracts. The effective portions of changes in the fair value of derivatives designated as cash flow hedges are recognized in the Statements of Consolidated Financial Position as a component of accumulated other comprehensive loss until the hedged items are recorded in earnings or it is probable the hedged transaction will no longer occur. Changes in the fair value of derivatives are recognized in the Statements of Consolidated Operations as a component of net sales, cost of goods sold and other income, net. The company’s short-term investments consist of cash which is contractually restricted as to withdrawal or usage. The company’s equity securities consist of publicly traded equity investments. Publicly traded equity investments are valued using quoted market prices and are classified as Level 1. Contractually restricted cash may be held in an interest bearing account measured using prevailing interest rates and is classified as Level 1. Short-term debt instruments are classified as Level 2. The company’s long-term debt securities are classified as Level 2 and valued using broker or dealer quoted prices with a maturity greater than one year. Short-term debt instruments may consist of commercial paper, current portion of long-term debt, borrowings under the delayed draw term loan facility, notes payable to banks and mandatorily redeemable shares. Commercial paper, notes payable to banks and borrowings under the delayed draw term loan facility are recorded at amortized cost in the Statements of Consolidated Financial Position, which approximates fair value. Current portion of long-term debt is measured at fair value for disclosure purposes and determined based on current market yields for Monsanto’s debt traded in the secondary market. Mandatorily redeemable shares are recorded in the Statements of Consolidated Financial Position at fair value, which represents the amount of cash the consolidated variable interest entity would pay if settlement occurred as of the respective reporting date. Fair value of the mandatorily redeemable shares of the variable interest entity is calculated using observable and unobservable inputs from an interest rate market in Brazil and stated contractual terms (a Level 3 measurement). See Note 11 — Debt and Other Credit Arrangements — for additional disclosures. Long-term debt was measured at fair value for disclosure purposes and determined based on current market yields for Monsanto’s debt traded in the secondary market. Long-term debt includes mandatorily redeemable shares. See Note 11 — Debt and Other Credit Arrangements — for additional disclosures. Accretion expense is included in the Statements of Consolidated Operations as interest expense. For the six months ended Feb. 28, 2018 , and Feb. 28, 2017 , the company had no transfers between Level 1, Level 2 and Level 3. Monsanto does not have any assets with fair value determined using Level 3 inputs as of Feb. 28, 2018 , and Aug. 31, 2017 . The following table summarizes the change in fair value of the Level 3 short-term debt instrument for the six months ended Feb. 28, 2018 . (Dollars in millions) Balance Aug. 31, 2017 $ — Reclass from long-term 2 Balance Feb. 28, 2018 (1) $ 2 (1) Includes interest on 315,000 mandatorily redeemable shares outstanding with a par value of 1,000 Brazilian reais (approximately $308 ) as of Feb. 28, 2018 . The following table summarizes the change in fair value of the Level 3 long-term debt instrument for the six months ended Feb. 28, 2018 . (Dollars in millions) Balance Aug. 31, 2017 $ 104 Reclass to short-term (2 ) Accretion expense 3 Payments (5 ) Effect of foreign currency translation adjustments (3 ) Balance Feb. 28, 2018 (1) $ 97 (1) Includes 315,000 mandatorily redeemable shares outstanding with a par value of 1,000 Brazilian reais (approximately $308 ) as of Feb. 28, 2018 . There were no significant measurements of liabilities to their implied fair value on a nonrecurring basis during the six months ended Feb. 28, 2018 , and Feb. 28, 2017 . There were no significant measurements of assets to their implied fair value on a nonrecurring basis during the six months ended Feb. 28, 2018 . Significant measurements during the six months ended Feb. 28, 2017 , of assets to their implied fair value on a nonrecurring basis were as follows: Property, Plant and Equipment, Net : During the three and six months ended Feb. 28, 2017, property, plant and equipment within the Seeds and Genomics segment with a net book value of $18 million was written down to its implied fair value estimate of $7 million , resulting in an impairment charge of $11 million , with $4 million included in cost of goods sold and $7 million included in restructuring charges in the Statement of Consolidated Operations. The implied fair value calculations were performed using a discounted cash flow model (a Level 3 measurement). See Note 3 — Restructuring — for additional disclosures. The recorded amounts of cash, trade receivables, miscellaneous receivables, third-party guarantees, accounts payable, grower production accruals, accrued marketing programs and miscellaneous short-term accruals approximate their fair values as of Feb. 28, 2018 , and Aug. 31, 2017 . Management is ultimately responsible for all fair values presented in the company’s consolidated financial statements. The company performs analysis and review of the information and prices received from third parties to ensure that the prices represent a reasonable estimate of fair value. This process involves quantitative and qualitative analysis. As a result of the analysis, if the company determines there is a more appropriate fair value based upon the available market data, the price received from the third party is adjusted accordingly. |
FINANCIAL INSTRUMENTS
FINANCIAL INSTRUMENTS | 6 Months Ended |
Feb. 28, 2018 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
FINANCIAL INSTRUMENTS | FINANCIAL INSTRUMENTS Cash Flow Hedges The company uses foreign currency options and foreign currency forward contracts as hedges of anticipated sales or purchases denominated in foreign currencies. The company enters into these contracts to protect itself against the risk that the eventual net cash flows will be adversely affected by changes in exchange rates. Monsanto’s commodity price risk management strategy is to use derivative instruments to minimize significant unanticipated earnings fluctuations that may arise from volatility in commodity prices. Price fluctuations in commodities, mainly in corn and soybeans, can cause the actual prices paid to production growers for corn and soybean seeds to differ from anticipated cash outlays. Monsanto generally uses commodity futures and options contracts to manage these risks. Monsanto’s energy and raw material risk management strategy is to use derivative instruments to minimize significant unanticipated manufacturing cost fluctuations that may arise from volatility in natural gas, diesel and ethylene prices. Monsanto’s interest rate risk management strategy is to use derivative instruments, such as forward-starting interest rate swaps and option contracts, to minimize significant unanticipated earnings fluctuations that may arise from volatility in interest rates of the company’s borrowings and to manage the interest rate sensitivity of its debt. For derivative instruments that are designated and qualify as cash flow hedges, the effective portion of the gain or loss on the derivative is reported as a component of accumulated other comprehensive loss and reclassified into earnings in the period or periods during which the hedged transaction affects earnings. Gains and losses on the derivative representing either hedge ineffectiveness or hedge components excluded from the assessment of effectiveness are recognized in current earnings. The maximum term over which the company is hedging exposures to the variability of cash flow (for all forecasted transactions) is six months for foreign currency hedges and 30 months for commodity hedges. During the next 12 months, a pretax net loss of approximately $15 million is expected to be reclassified from accumulated other comprehensive loss into earnings. A pretax loss of $37 million was reclassified into other income, net as a result of the discontinuance of an interest rate hedge during the six months ended Feb. 28, 2017 , because it was probable the original forecasted transaction would not occur by the end of the originally specified time period. During the three months ended Feb. 28, 2017 , a pretax loss of less than $1 million was reclassified into cost of goods sold in the Statement of Consolidated Operations as a result of the discontinuance of foreign currency cash flow hedges because it was probable that the original forecasted transactions would not occur by the end of the originally specified time period. No cash flow hedges were discontinued during the three and six months ended Feb. 28, 2018 . Fair Value Hedges The company uses commodity futures, forwards and options contracts as fair value hedges to manage the value of its soybean inventory and other assets. For derivative instruments that are designated and qualify as fair value hedges, both the gain or loss on the derivative and the offsetting loss or gain on the hedged item attributable to the hedged risk are recognized in current earnings. No fair value hedges were discontinued during the three and six months ended Feb. 28, 2018 , and Feb. 28, 2017 . Derivatives Not Designated as Hedging Instruments The company uses foreign currency contracts to hedge the effects of fluctuations in exchange rates on foreign currency denominated third-party and intercompany receivables and payables. Both the gain or loss on the derivative and the offsetting loss or gain on the hedged item attributable to the hedged risk are recognized in current earnings. The company uses commodity option contracts to hedge anticipated cash payments to growers, which can fluctuate with changes in commodity price. Because these option contracts do not meet the provisions specified by the Derivatives and Hedging topic of the ASC, they do not qualify for hedge accounting treatment. Accordingly, the gain or loss on these derivatives is recognized in current earnings. To reduce credit exposure in Latin America, Monsanto collects payments on certain customer accounts in grain. Such payments in grain are negotiated at or near the time Monsanto’s products are sold to the customers and are valued at the prevailing grain commodity prices. By entering into forward sales contracts related to grain, Monsanto mitigates the commodity price exposure from the time a contract is signed with a customer until the time a grain merchant collects the grain from the customer on Monsanto’s behalf. The forward sales contracts do not qualify for hedge accounting treatment under the Derivatives and Hedging topic of the ASC. Accordingly, the gain or loss on these derivatives is recognized in current earnings. Monsanto uses interest rate contracts to minimize the variability of forecasted cash flows arising from the company’s consolidated VIE in Brazil. The interest rate contracts do not qualify for hedge accounting treatment under the Derivatives and Hedging Topic of the ASC. Accordingly, the gain or loss on these derivatives is recognized in current earnings. Financial instruments are neither held nor issued by the company for trading purposes. The notional amounts of the company’s derivative instruments outstanding as of Feb. 28, 2018 , and Aug. 31, 2017 , are as follows: As of (Dollars in millions) Feb. 28, 2018 Aug. 31, 2017 Derivatives Designated as Hedges: Foreign exchange contracts $ 299 $ 453 Commodity contracts 621 430 Total Derivatives Designated as Hedges $ 920 $ 883 Derivatives Not Designated as Hedges: Foreign exchange contracts $ 1,709 $ 2,133 Commodity contracts 161 189 Interest rate contracts 7 21 Total Derivatives Not Designated as Hedges $ 1,877 $ 2,343 The net presentation of the company’s derivative instruments outstanding was as follows: As of Feb. 28, 2018 (Dollars in millions) Gross Amounts Recognized Gross Amounts Offset in the Statement of Consolidated Financial Position Net Amounts Included in the Statement of Consolidated Financial Position Collateral Pledged Net Amounts Reported in the Statement of Consolidated Financial Position Other Items Included in the Statement of Consolidated Financial Position Statement of Consolidated Financial Position Balance Asset Derivatives: Other current assets Derivatives designated as hedges: Commodity contracts (1) $ 18 $ (9 ) $ 9 $ — $ 9 Derivatives not designated as hedges: Commodity contracts 8 — 8 — 8 Foreign exchange contracts 3 — 3 — 3 Total other current assets 29 (9 ) 20 — 20 $ 290 $ 310 Other assets Derivatives designated as hedges: Commodity contracts 1 — 1 — 1 Total other assets 1 — 1 — 1 891 892 Total Asset Derivatives $ 30 $ (9 ) $ 21 $ — $ 21 Liability Derivatives: Other current assets Derivatives designated as hedges: Commodity contracts (1) $ 9 $ (9 ) $ — $ — $ — Total other current assets 9 (9 ) — — — Miscellaneous short-term accruals Derivatives designated as hedges: Commodity contracts 1 — 1 — 1 Foreign exchange contracts 6 — 6 — 6 Derivatives not designated as hedges: Commodity contracts 6 — 6 — 6 Foreign exchange contracts 9 — 9 — 9 Total miscellaneous short-term accruals 22 — 22 — 22 $ 680 $ 702 Total Liability Derivatives $ 31 $ (9 ) $ 22 $ — $ 22 (1) As allowed by the Derivatives and Hedging topic of the ASC, commodity derivative assets and liabilities have been offset by collateral subject to an enforceable master netting arrangement or similar arrangement. Therefore, these commodity contracts that are in an asset or liability position are included in asset accounts within the Statements of Consolidated Financial Position. As of Aug. 31, 2017 (Dollars in millions) Gross Amounts Recognized Gross Amounts Offset in the Statement of Consolidated Financial Position Net Amounts Included in the Statement of Consolidated Financial Position Collateral Pledged Net Amounts Reported in the Statement of Consolidated Financial Position Other Items Included in the Statement of Consolidated Financial Position Statement of Consolidated Financial Position Balance Asset Derivatives: Other current assets Derivatives designated as hedges: Commodity contracts (1) $ 2 $ (7 ) $ (5 ) $ 5 $ — Derivatives not designated as hedges: Commodity contracts 6 — 6 — 6 Foreign exchange contracts 10 — 10 — 10 Total other current assets 18 (7 ) 11 5 16 $ 252 $ 268 Other assets Derivatives designated as hedges: Commodity contracts 1 — 1 — 1 Total other assets 1 — 1 — 1 954 955 Miscellaneous short-term accruals Derivatives designated as hedges: Commodity contracts (1) 1 (1 ) — — — Total miscellaneous short-term accruals 1 (1 ) — — — Total Asset Derivatives $ 20 $ (8 ) $ 12 $ 5 $ 17 Liability Derivatives: Other current assets Derivatives designated as hedges: Commodity contracts (1) $ 7 $ (7 ) $ — $ — $ — Total other current assets 7 (7 ) — — — Miscellaneous short-term accruals Derivatives designated as hedges: Commodity contracts (1) 3 (1 ) 2 — 2 Foreign currency contracts 14 — 14 — 14 Derivatives not designated as hedges: Commodity contracts 3 — 3 — 3 Foreign exchange contracts 2 — 2 — 2 Total miscellaneous short-term accruals 22 (1 ) 21 — 21 $ 719 $ 740 Total Liability Derivatives $ 29 $ (8 ) $ 21 $ — $ 21 (1) As allowed by the Derivatives and Hedging topic of the ASC, commodity derivative assets and liabilities have been offset by collateral subject to an enforceable master netting arrangement or similar arrangement. Therefore, these commodity contracts that are in an asset or liability position are included in asset accounts within the Statements of Consolidated Financial Position. The gains and losses on the company’s derivative instruments were as follows: Amount of Gain (Loss) Recognized in AOCL (1) (Effective Portion) Amount of Gain (Loss) Recognized in Income (2)(3) Three Months Ended Three Months Ended Statements of Consolidated Operations Classification (Dollars in millions) Feb. 28, 2018 Feb. 28, 2017 Feb. 28, 2018 Feb. 28, 2017 Derivatives Designated as Hedges: Fair value hedges: Commodity contracts $ (9 ) $ 3 Cost of goods sold Cash flow hedges: Foreign currency contracts $ (2 ) $ 3 1 3 Net sales Foreign currency contracts — 1 — 1 Cost of goods sold Commodity contracts 12 10 1 (12 ) Cost of goods sold Interest rate contracts — (1 ) (4 ) (4 ) Interest expense Total Derivatives Designated as Hedges 10 13 (11 ) (9 ) Derivatives Not Designated as Hedges: Foreign currency contracts (4) (3 ) 26 Other income, net Commodity contracts (1 ) 1 Net sales Commodity contracts 1 — Cost of goods sold Total Derivatives Not Designated as Hedges (3 ) 27 Total Derivatives $ 10 $ 13 $ (14 ) $ 18 (1) Accumulated other comprehensive loss (AOCL) (2) For derivatives designated as cash flow hedges under the Derivatives and Hedging topic of the ASC, this represents the effective portion of the gain (loss) reclassified from AOCL into income during the period. (3) The gain or loss on derivatives designated as hedges from ineffectiveness is not significant during the three months ended Feb. 28, 2018 , and Feb. 28, 2017 . No gains or losses were excluded from the assessment of hedge effectiveness during the three months ended Feb. 28, 2018 , and Feb. 28, 2017 . (4) Gain or loss on foreign currency contracts not designated as hedges was offset by a foreign currency transaction loss of $41 million and $21 million during the three months ended Feb. 28, 2018 , and Feb. 28, 2017 , respectively. Amount of Gain (Loss) Recognized in AOCL (1) (Effective Portion) Amount of Gain (Loss) Recognized in Income (2)(3) Six Months Ended Six Months Ended Statements of Consolidated Operations Classification (Dollars in millions) Feb. 28, 2018 Feb. 28, 2017 Feb. 28, 2018 Feb. 28, 2017 Derivatives Designated as Hedges: Fair value hedges: Commodity contracts $ (8 ) $ (10 ) Cost of goods sold Cash flow hedges: Foreign currency contracts $ 7 $ 20 3 10 Net sales Foreign currency contracts — 7 — 2 Cost of goods sold Commodity contracts 14 29 — (15 ) Cost of goods sold Interest rate contracts — — — (37 ) Other income, net Interest rate contracts — 3 (7 ) (8 ) Interest expense Total Derivatives Designated as Hedges 21 59 (12 ) (58 ) Derivatives Not Designated as Hedges: Foreign currency contracts (4) 8 (19 ) Other income, net Commodity contracts (2 ) 1 Net sales Commodity contracts 1 (1 ) Cost of goods sold Total Derivatives Not Designated as Hedges 7 (19 ) Total Derivatives $ 21 $ 59 $ (5 ) $ (77 ) (1) Accumulated other comprehensive loss (AOCL) (2) For derivatives designated as cash flow hedges under the Derivatives and Hedging topic of the ASC, this represents the effective portion of the gain (loss) reclassified from AOCL into income during the period. (3) The gain or loss on derivatives designated as hedges from ineffectiveness is not significant during the six months ended Feb. 28, 2018 , and Feb. 28, 2017 . No gains or losses were excluded from the assessment of hedge effectiveness during the six months ended Feb. 28, 2018 , and Feb. 28, 2017 . (4) Gain or loss on foreign currency contracts not designated as hedges was offset by a foreign currency transaction loss of $43 million and a gain of $18 million during the six months ended Feb. 28, 2018 , and Feb. 28, 2017 , respectively. Most of the company’s outstanding foreign currency derivatives are covered by International Swap and Derivatives Association (“ISDA”) Master Agreements with the counterparties. There are no requirements to post collateral under these agreements; however, should Monsanto’s credit rating fall below a specified rating immediately following the merger of the company with another entity, the counterparty may require all outstanding derivatives under the ISDA Master Agreement to be settled immediately at current market value, which equals carrying value. Foreign currency derivatives that are not covered by ISDA Master Agreements do not have credit-risk-related contingent provisions. Most of Monsanto’s outstanding commodity derivatives are listed commodity futures, and the company is required by the relevant commodity exchange to post collateral each day to cover the change in the fair value of these futures in the case of an unrealized loss position. Non-exchange-traded commodity derivatives and interest rate contracts may be covered by the aforementioned ISDA Master Agreements and would be subject to the same credit-risk-related contingent provisions. The aggregate fair value of all derivative instruments under ISDA Master Agreements that are in a liability position was $11 million and $19 million as of Feb. 28, 2018 , and Aug. 31, 2017 , respectively, which is the amount that would be required for settlement if the credit-risk-related contingent provisions underlying these agreements were triggered. Credit Risk Management Monsanto invests excess cash in deposits with major banks or money market funds throughout the world in high-quality short-term debt instruments. Such investments are made only in instruments issued or enhanced by high-quality institutions. As of Feb. 28, 2018 , and Aug. 31, 2017 , the company had no financial instruments that represented a significant concentration of credit risk. Limited amounts are invested in any single institution to minimize risk. The company has not incurred any credit risk losses related to those investments. The company sells a broad range of agricultural products to a diverse group of customers throughout the world. In the United States, the company makes substantial sales to relatively few large wholesale customers. The company’s business is highly seasonal and is subject to weather conditions that affect commodity prices and seed yields. Credit limits, ongoing credit evaluation and account monitoring procedures are used to minimize the risk of loss. Collateral is secured when it is deemed appropriate by the company. Monsanto regularly evaluates its business practices to minimize its credit risk and periodically engages multiple banks in the United States, Latin America and Europe in the development of customer financing options that involve direct bank financing of customer purchases. For further information on these programs, see Note 4 — Customer Financing Programs . |
POSTRETIREMENT BENEFITS - PENSI
POSTRETIREMENT BENEFITS - PENSIONS, HEALTH CARE AND OTHER | 6 Months Ended |
Feb. 28, 2018 | |
Retirement Benefits [Abstract] | |
POSTRETIREMENT BENEFITS-PENSIONS, HEALTH CARE AND OTHER | POSTRETIREMENT BENEFITS — PENSIONS, HEALTH CARE AND OTHER Monsanto maintains noncontributory pension plans for the benefit of its U.S. employees. Effective Jul. 8, 2012, the U.S. pension plans were closed to new entrants; there were no significant changes to these plans for eligible employees hired prior to that date. The company also provides certain postretirement health care and life insurance benefits for eligible retired employees and certain pension plan benefits outside the U.S. The company’s net periodic benefit cost for pension benefits and health care and other postretirement benefits include the following components: Pension Benefits Three Months Ended Feb. 28, 2018 Three Months Ended Feb. 28, 2017 (Dollars in millions) U.S. Outside the U.S. Total U.S. Outside the U.S. Total Service Cost for Benefits Earned During the Period $ 14 $ 3 $ 17 $ 15 $ 3 $ 18 Interest Cost on Benefit Obligation 22 1 23 20 1 21 Assumed Return on Plan Assets (43 ) (2 ) (45 ) (43 ) (2 ) (45 ) Amortization of Unrecognized Net Loss 10 1 11 12 1 13 Restructuring Charges — — — — 2 2 Total Net Periodic Benefit Cost $ 3 $ 3 $ 6 $ 4 $ 5 $ 9 Pension Benefits Six Months Ended Feb. 28, 2018 Six Months Ended Feb. 28, 2017 (Dollars in millions) U.S. Outside the U.S. Total U.S. Outside the U.S. Total Service Cost for Benefits Earned During the Period $ 28 $ 6 $ 34 $ 30 $ 6 $ 36 Interest Cost on Benefit Obligation 44 3 47 41 3 44 Assumed Return on Plan Assets (86 ) (5 ) (91 ) (85 ) (4 ) (89 ) Amortization of Unrecognized Net Loss 20 2 22 24 2 26 Restructuring Charges — — — — 2 2 Total Net Periodic Benefit Cost $ 6 $ 6 $ 12 $ 10 $ 9 $ 19 Health Care and Other Postretirement Benefits Three Months Ended (Dollars in millions) Feb. 28, 2018 Feb. 28, 2017 Service Cost for Benefits Earned During the Period $ 2 $ 2 Interest Cost on Benefit Obligation 1 1 Amortization of Unrecognized Net (Gain)/Loss (1 ) 2 Restructuring Charges — 2 Total Net Periodic Benefit Cost $ 2 $ 7 Health Care and Other Postretirement Benefits Six Months Ended (Dollars in millions) Feb. 28, 2018 Feb. 28, 2017 Service Cost for Benefits Earned During the Period $ 4 $ 3 Interest Cost on Benefit Obligation 2 2 Amortization of Unrecognized Net (Gain)/Loss (2 ) 3 Restructuring Charges — 2 Total Net Periodic Benefit Cost $ 4 $ 10 |
STOCK BASED COMPENSATION PLANS
STOCK BASED COMPENSATION PLANS STOCK BASED COMPENSATION PLANS | 6 Months Ended |
Feb. 28, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
STOCK BASED COMPENSATION PLANS | STOCK-BASED COMPENSATION PLANS The following table shows total stock-based compensation expense included in the Statements of Consolidated Operations for the three and six months ended Feb. 28, 2018 , and Feb. 28, 2017 . Three Months Ended Six Months Ended (Dollars in millions) Feb. 28, 2018 Feb. 28, 2017 Feb. 28, 2018 Feb. 28, 2017 Cost of Goods Sold $ 4 $ 4 $ 8 $ 7 Selling, General and Administrative Expenses 18 19 43 45 Research and Development Expenses 6 7 12 13 Restructuring Charges — — — 1 Pre-Tax Stock-Based Compensation Expense 28 30 63 66 Income Tax Benefit (2 ) (10 ) (18 ) (23 ) Net Stock-Based Compensation Expense $ 26 $ 20 $ 45 $ 43 |
ACCUMULATED OTHER COMPREHENSIVE
ACCUMULATED OTHER COMPREHENSIVE LOSS | 6 Months Ended |
Feb. 28, 2018 | |
Equity [Abstract] | |
ACCUMULATED OTHER COMPREHENSIVE LOSS | ACCUMULATED OTHER COMPREHENSIVE LOSS The following table sets forth the after-tax components of accumulated other comprehensive loss and changes thereto: (Dollars in millions) Foreign Currency Translation Adjustments Postretirement Benefit Items Net Unrealized Gain (Loss) on Available-for-Sale Securities Cash Flow Hedges Total Accumulated Other Comprehensive (Loss) Income Balance as of Aug. 31, 2016 $ (2,292 ) $ (340 ) $ 1 $ (177 ) $ (2,808 ) Other comprehensive income (loss) before reclassifications 233 55 (2 ) 21 307 Amounts reclassified from accumulated other comprehensive loss — 38 2 34 74 Net current-period other comprehensive income 233 93 — 55 381 Balance as of Aug. 31, 2017 $ (2,059 ) $ (247 ) $ 1 $ (122 ) $ (2,427 ) Other comprehensive income (loss) before reclassifications 25 (48 ) (1 ) (11 ) (35 ) Amounts reclassified from accumulated other comprehensive loss (income) — 15 (1 ) 3 17 Net current-period other comprehensive income (loss) 25 (33 ) (2 ) (8 ) (18 ) Balance as of Feb. 28, 2018 $ (2,034 ) $ (280 ) $ (1 ) $ (130 ) $ (2,445 ) The following table provides additional information regarding items reclassified out of accumulated other comprehensive loss into earnings. Three Months Ended Six Months Ended (Dollars in millions) Feb. 28, 2018 Feb. 28, 2017 Feb. 28, 2018 Feb. 28, 2017 Affected Line Item in the Statements of Consolidated Operations Available for Sale Securities: (Gain) Loss on Equity Security $ (1 ) $ 2 $ (1 ) $ 2 Other income, net (1 ) 2 (1 ) 2 Total before income taxes — (1) — (1) Income tax provision $ (1 ) $ 1 $ (1 ) $ 1 Net of tax Cash Flow Hedges: Foreign Exchange Contracts $ (1 ) $ (3 ) $ (3 ) $ (10 ) Net sales Foreign Exchange Contracts — (1 ) — (2 ) Cost of goods sold Commodity Contracts (1 ) 12 — 15 Cost of goods sold Interest Rate Contracts — — — 37 Other income, net Interest Rate Contracts 4 4 7 8 Interest expense 2 12 4 48 Total before income taxes (1 ) (4 ) (1 ) (19 ) Income tax provision $ 1 $ 8 $ 3 $ 29 Net of tax Postretirement Benefit Items: Amortization of Unrecognized Net Loss $ 3 $ 5 $ 7 $ 11 Inventory/Cost of goods sold (1) Amortization of Unrecognized Net Loss 7 10 13 20 Selling, general and administrative expenses Amortization of Unrecognized Net Loss — 4 — 4 Restructuring charges 10 19 20 35 Total before income taxes (1 ) (6 ) (5 ) (12 ) Income tax provision $ 9 $ 13 $ 15 $ 23 Net of tax Total Reclassifications For The Period $ 9 $ 22 $ 17 $ 53 Net of tax (1) The amortization of unrecognized net loss is recorded to net periodic benefit cost, which is allocated to selling, general and administrative expenses and to inventory, which is recognized through cost of goods sold. The company recorded $3 million and $5 million of net periodic benefit cost to inventory, of which approximately $2 million and $3 million was recognized in cost of goods sold during the three months ended Feb. 28, 2018 , and Feb. 28, 2017 , respectively. The company recorded $7 million and $11 million of net periodic benefit cost to inventory, of which approximately $7 million and $10 million was recognized in cost of goods sold during the six months ended Feb. 28, 2018 , and Feb. 28, 2017 , respectively. See Note 14 — Postretirement Benefits - Pensions, Health Care and Other — for additional information. |
EARNINGS PER SHARE
EARNINGS PER SHARE | 6 Months Ended |
Feb. 28, 2018 | |
Earnings Per Share [Abstract] | |
EARNINGS PER SHARE | EARNINGS PER SHARE Basic earnings per share (“EPS”) was computed using the weighted-average number of common shares outstanding during the periods shown in the table below. The diluted EPS computation takes into account the effect of dilutive potential common shares when in a net income position. Potential common shares consist primarily of stock options, restricted stock units and directors’ deferred shares calculated using the treasury stock method and are excluded if their effect is antidilutive. Of those antidilutive options, certain options were excluded from the computations of dilutive potential common shares as their exercise prices were greater than the average market price of the common shares for the period. Three Months Ended Six Months Ended (Shares in millions) Feb. 28, 2018 Feb. 28, 2017 Feb. 28, 2018 Feb. 28, 2017 Weighted-Average Number of Common Shares 441.0 438.7 440.6 438.4 Dilutive Potential Common Shares 4.5 3.6 5.3 3.9 Antidilutive Potential Common Shares 0.1 2.2 0.1 4.0 |
SUPPLEMENTAL CASH FLOW INFORMAT
SUPPLEMENTAL CASH FLOW INFORMATION | 6 Months Ended |
Feb. 28, 2018 | |
Supplemental Cash Flow Information [Abstract] | |
SUPPLEMENTAL CASH FLOW INFORMATION | SUPPLEMENTAL CASH FLOW INFORMATION Cash payments for interest and taxes were as follows: Six Months Ended (Dollars in millions) Feb. 28, 2018 Feb. 28, 2017 Interest $ 235 $ 225 Taxes 229 187 The company recorded the following noncash transactions: • During the six months ended Feb. 28, 2018 , and Feb. 28, 2017 , the company recognized noncash transactions related to restructuring. See Note 3 — Restructuring . • As of Feb. 28, 2018 , and Feb. 28, 2017 , the company recognized noncash capital expenditures of $103 million and $117 million , respectively, in accounts payable in the Statements of Consolidated Financial Position. • During the six months ended Feb. 28, 2018 , and Feb. 28, 2017 , the company recognized noncash transactions related to stock-based compensation. See Note 15 — Stock-Based Compensation Plans . • In the second quarter of fiscal 2018 and 2017 , the board of directors declared a dividend which is payable in the third quarter of fiscal 2018 and 2017 , respectively. As of Feb. 28, 2018 , and Feb. 28, 2017 , a dividend payable of $239 million and $237 million , respectively, was recorded. • During the six months ended Feb. 28, 2018 , the company recognized noncash transactions of $46 million related to a capital lease. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 6 Months Ended |
Feb. 28, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES Environmental and Litigation Liabilities: Monsanto is involved in environmental remediation and legal proceedings to which Monsanto is party in its own name and proceedings to which its former parent, Pharmacia LLC (“Pharmacia”), or its former subsidiary, Solutia, Inc. (“Solutia”), is a party but that Monsanto manages and for which Monsanto is responsible pursuant to certain indemnification agreements. In addition, Monsanto has liabilities established for various product claims. With respect to certain of these proceedings, Monsanto has a liability recorded of $254 million and $277 million as of Feb. 28, 2018 , and Aug. 31, 2017 , respectively, for the estimated contingent liabilities. Information regarding the environmental liabilities appears in Monsanto’s Report on Form 10-K for the fiscal year ended Aug. 31, 2017 . Litigation: The above liability includes amounts related to certain third-party litigation with respect to Monsanto’s business, as well as tort litigation related to Pharmacia’s former chemical business, including lawsuits involving polychlorinated biphenyls (“PCBs”), dioxins, and other chemical and premises liability litigation. Additional matters that are not reflected in the liability may arise in the future, and Monsanto may manage, settle, or pay judgments or damages with respect thereto in order to mitigate contesting potential liability. Following is a description of one of the more significant litigation matters. As described in Monsanto’s Report on Form 10-K for the fiscal year ended Aug. 31, 2017, and its Report on Form 10-Q for the quarterly period ended Nov. 30, 2017, the company was named in approximately 30 personal injury lawsuits filed over several years on behalf of approximately 750 persons in state courts in St. Louis, Missouri and Los Angeles, California. Plaintiffs claimed they were injured by PCBs manufactured by Pharmacia’s chemical business over four decades ago and incorporated into products made, used and sometimes disposed of by others. In September 2016, the parties reached an agreement to settle these personal injury lawsuits pursuant to which the company is required to pay up to $280 million into a settlement fund, with the settlement and the final payment amount contingent upon the level of claimant participation. As of Aug. 31, 2016, $280 million was recorded in the Statement of Consolidated Financial Position within miscellaneous short-term accruals. Payment of the $280 million was made November 2016 through December 2017 covering all claimants. Including litigation reflected in the liability, Monsanto is involved in various legal proceedings that arise in the ordinary course of its business or pursuant to Monsanto’s indemnification obligations to Pharmacia, as well as proceedings that management has considered to be material under SEC regulations. Some of the lawsuits seek damages in very large amounts or seek to restrict the company’s business activities. Monsanto believes that it has meritorious legal arguments and will continue to represent its interests vigorously in all of the proceedings that it is defending or prosecuting. Management does not anticipate the ultimate liabilities resulting from such proceedings, or the proceedings reflected in the above liability, will have a material adverse effect on Monsanto’s consolidated results of operations, financial position, cash flows or liquidity. The company has been named in lawsuits brought by various governmental entities claiming that Monsanto, Pharmacia and Solutia, collectively as a manufacturer of PCBs, should be responsible for a variety of damages due to PCBs in bodies of water, regardless of how PCBs came to be located there. The company believes that these novel claims are without merit and is vigorously defending the cases on legal and factual grounds. A reasonable estimate of the possible loss contingency can not be made. The company is defending lawsuits in various state and federal courts, in which approximately 5,200 plaintiffs claim to have been injured by exposure to glyphosate-based products manufactured by the company. The majority of plaintiffs have brought actions in state courts in Missouri, Delaware and California, while the remainder of plaintiffs’ cases were filed in many different federal courts. In October 2016, the Judicial Panel on Multi-District Litigation transferred to the Northern District of California all of the federal cases for pretrial purposes. The company believes that it has meritorious factual and legal defenses to these cases and is vigorously defending them. A reasonable estimate of the possible loss contingency can not be made. Legal actions have been filed in Brazil that raise various issues challenging the right to collect certain royalties for Roundup Ready soybeans, such as whether Brazilian pipeline patents have the duration of their corresponding U.S. patents (2014 for Roundup Ready soybeans) and whether Brazil’s Plant Variety Protection law affects the enforceability of patents. These issues are currently under judicial review in Brazil. Monsanto believes it has meritorious legal arguments and will continue to represent its interests vigorously in these proceedings. The current estimate of the company’s reasonably possible loss contingency is not material to the consolidated results of operations, financial position, cash flows or liquidity. Guarantees: Disclosures regarding the guarantees Monsanto provides for certain customer loans in the United States, Latin America and Europe can be found in Note 4 — Customer Financing Programs — of this Form 10-Q. Except as described in that note, there have been no significant changes to guarantees made by Monsanto since Aug. 31, 2017 . Disclosures regarding these guarantees made by Monsanto can be found in Note 24 — Commitments and Contingencies — of the notes to the consolidated financial statements contained in Monsanto’s Report on Form 10-K for the fiscal year ended Aug. 31, 2017 . Off-Balance Sheet Arrangement: In the first quarter of fiscal 2018, Monsanto completed a significant expansion of its Chesterfield, Missouri facility. In December 2013, Monsanto executed the first of a series of incentive agreements with the County of St. Louis, Missouri. Under these agreements Monsanto has transferred the Chesterfield, Missouri facility to St. Louis County and received Industrial Revenue Bonds in the amount of up to $470 million , which enables the company to reduce the cost of constructing and operating the expansion by reducing certain state and local tax expenditures. Monsanto immediately leased the facility from the County of St. Louis and has an option to purchase the facility upon tendering the Industrial Revenue Bonds received to the County. The payments due to the company in relation to the Industrial Revenue Bonds and owed by the company in relation to the lease of the facility qualify for the right of offset under ASC 210, Balance Sheet , in the Statements of Consolidated Financial Position. As such, neither the Industrial Revenue Bonds nor the lease obligation are recorded in the Statements of Consolidated Financial Position as an asset or liability, respectively. The Chesterfield facility and the expansion are being treated as being owned by Monsanto. |
SEGMENT AND GEOGRAPHIC DATA
SEGMENT AND GEOGRAPHIC DATA | 6 Months Ended |
Feb. 28, 2018 | |
Segment Reporting [Abstract] | |
SEGMENT INFORMATION | NOTE 20. SEGMENT INFORMATION Monsanto conducts its worldwide operations through global businesses, which are aggregated into reportable segments based on similarity of products, production processes, customers, distribution methods and economic characteristics. The operating segments are aggregated into two reportable segments: Seeds and Genomics and Agricultural Productivity. The Seeds and Genomics segment consists of the global seeds and related traits businesses, biotechnology platforms and digital agriculture. Within the Seeds and Genomics segment, Monsanto’s significant operating segments are corn seed and traits, soybean seed and traits, cotton seed and traits, vegetable seeds and all other crops seeds and traits. The Agricultural Productivity reportable segment consists of the Agricultural Productivity operating segment. EBIT is defined as earnings (loss) before interest and taxes and is an operating performance measure for the two reportable segments. EBIT is useful to management in demonstrating the operational profitability of the segments by excluding interest and taxes, which are generally accounted for across the entire company on a consolidated basis. Sales between segments were not significant. Certain selling, general and administrative expenses are allocated between segments based on the segment’s relative contribution to total Monsanto operations. Allocation percentages remain consistent for fiscal years 2017 and 2018 . Data for the Seeds and Genomics and Agricultural Productivity reportable segments, as well as for Monsanto’s significant operating segments, is presented in the table as follows: Three Months Ended Six Months Ended (Dollars in millions) Feb. 28, 2018 Feb. 28, 2017 Feb. 28, 2018 Feb. 28, 2017 Net Sales (1) Corn seed and traits $ 2,721 $ 2,902 $ 3,508 $ 3,851 Soybean seed and traits 912 862 1,640 1,462 Cotton seed and traits 123 108 243 224 Vegetable seeds 198 193 312 324 All other crops seeds and traits 134 121 155 173 Total Seeds and Genomics $ 4,088 $ 4,186 $ 5,858 $ 6,034 Agricultural productivity 931 888 1,819 1,690 Total Agricultural Productivity $ 931 $ 888 $ 1,819 $ 1,690 Total $ 5,019 $ 5,074 $ 7,677 $ 7,724 Gross Profit Corn seed and traits $ 1,790 $ 1,932 $ 2,205 $ 2,467 Soybean seed and traits 672 628 1,260 1,079 Cotton seed and traits 101 77 174 150 Vegetable seeds 93 99 151 168 All other crops seeds and traits 81 41 79 53 Total Seeds and Genomics $ 2,737 $ 2,777 $ 3,869 $ 3,917 Agricultural productivity 229 175 409 294 Total Agricultural Productivity $ 229 $ 175 $ 409 $ 294 Total $ 2,966 $ 2,952 $ 4,278 $ 4,211 EBIT (2)(3)(4) Seeds and Genomics $ 1,779 $ 1,839 $ 2,081 $ 2,038 Agricultural Productivity 143 119 181 132 Total $ 1,922 $ 1,958 $ 2,262 $ 2,170 Depreciation and Amortization Expense Seeds and Genomics $ 152 $ 142 $ 301 $ 285 Agricultural Productivity 41 41 80 87 Total $ 193 $ 183 $ 381 $ 372 (1) Represents net sales from continuing operations. (2) EBIT is defined as earnings (loss) before interest and taxes; see the following table for reconciliation. Earnings (loss) is intended to mean net income (loss) attributable to Monsanto Company as presented in the Statements of Consolidated Operations under U.S. GAAP. EBIT is an operating performance measure for the two reportable segments. (3) Agricultural Productivity EBIT includes income from operations of discontinued businesses of $2 million and $5 million for the three months ended Feb. 28, 2018, and Feb. 28, 2017, respectively. Agricultural Productivity EBIT includes income from operations of discontinued businesses of $4 million and $21 million for the six months ended Feb. 28, 2018 , and Feb. 28, 2017 , respectively. (4) Seeds and Genomics EBIT includes a loss from operations of noncontrolling interests of $2 million for the three months ended Feb. 28, 2017. Agricultural Productivity EBIT includes income from operations of noncontrolling interests of $1 million for the three months ended Feb. 28, 2018 , and Feb. 28, 2017. Seeds and Genomics EBIT includes income from operations of noncontrolling interests of $2 million and $6 million for the six months ended Feb. 28, 2018, and Feb. 28, 2017, respectively. Agricultural Productivity EBIT includes income from operations of noncontrolling interests of $1 million for the six months ended Feb. 28, 2018, and Feb. 28, 2017. A reconciliation of EBIT to net income attributable to Monsanto Company for each period is as follows: Three Months Ended Six Months Ended (Dollars in millions) Feb. 28, 2018 Feb. 28, 2017 Feb. 28, 2018 Feb. 28, 2017 EBIT (1) $ 1,922 $ 1,958 $ 2,262 $ 2,170 Interest Expense — Net 81 84 190 202 Income Tax Provision (2) 382 506 444 571 Net Income Attributable to Monsanto Company $ 1,459 $ 1,368 $ 1,628 $ 1,397 (1) Includes the income from operations of discontinued businesses and the income (loss) from operations of noncontrolling interests. (2) Includes the income tax provision on discontinued operations and the income tax provision (benefit) of noncontrolling interests. |
RESTRUCTURING (Tables)
RESTRUCTURING (Tables) | 6 Months Ended | 18 Months Ended | 30 Months Ended |
Feb. 28, 2018 | Feb. 28, 2018 | Feb. 28, 2018 | |
Restructuring and Related Activities [Abstract] | |||
Restructuring and Related Costs | Restructuring charges were recorded in the Statements of Consolidated Operations as follows: Three Months Ended Six Months Ended (Dollars in millions) Feb. 28, 2018 Feb. 28, 2017 Feb. 28, 2018 Feb. 28, 2017 Cost of Goods Sold (1) $ (4 ) $ (6 ) $ (17 ) $ (7 ) Restructuring Charges (2) 1 (23 ) (3 ) 13 Income from Continuing Operations Before Income Taxes $ (3 ) $ (29 ) $ (20 ) $ 6 Income Tax Provision 15 15 23 5 Net Income $ 12 $ (14 ) $ 3 $ 11 (1) For the three months ended Feb. 28, 2018 , $4 million of restructuring charges in cost of goods sold was recorded in the Agricultural Productivity segment. For the three months ended Feb. 28, 2017, $6 million of restructuring charges in cost of goods sold was split by segment as follows: $5 million in Seeds and Genomics and $1 million in Agricultural Productivity. For the six months ended Feb. 28, 2018, $17 million of restructuring charges in cost of goods sold was split by segment as follows: $10 million in Seeds and Genomics and $7 million in Agricultural Productivity. For the six months ended Feb. 28, 2017, $7 million of restructuring charges in cost of goods sold was split by segment as follows: $6 million in Seeds and Genomics and $1 million in Agricultural Productivity. (2) For the three months ended Feb. 28, 2018 , the net reversal of previously recognized expense of $1 million was recorded in the Seeds and Genomics segment. For the three months ended Feb. 28, 2017, $23 million of restructuring charges was split by segment as follows: $22 million in Seeds and Genomics and $1 million in Agricultural Productivity. For the six months ended Feb. 28, 2018, $3 million of restructuring charges was split by segment as follows: $2 million in Seeds and Genomics and $1 million in Agricultural Productivity. For the six months ended Feb. 28, 2017, the net reversal of previously recognized expense of $13 million was split by segment as follows: $12 million in Seeds and Genomics and $1 million in Agricultural Productivity. | The following tables summarize the activities related to the company’s 2015 Restructuring Plan. Three months ended Feb. 28, 2018 Three months ended Feb. 28, 2017 (Dollars in millions) Seeds and Genomics Agricultural Productivity Total Seeds and Agricultural Total Work Force Reductions $ (6 ) $ (1 ) $ (7 ) $ 2 $ — $ 2 Facility Closures/Exit Costs 5 5 10 8 1 9 Asset Impairments and Write-offs: Property, plant and equipment — — — 18 1 19 Inventory — — — (1 ) — (1 ) Goodwill and other assets — — — — — — Total Restructuring Charges, Net $ (1 ) $ 4 $ 3 $ 27 $ 2 $ 29 Six months ended Feb. 28, 2018 Six months ended Feb. 28, 2017 Cumulative Amount through Feb. 28, 2018 (Dollars in millions) Seeds and Genomics Agricultural Productivity Total Seeds and Agricultural Total Seeds and Agricultural Total Work Force Reductions $ (10 ) $ (1 ) $ (11 ) $ (34 ) $ (2 ) $ (36 ) $ 297 $ 17 $ 314 Facility Closures/Exit Costs 20 9 29 10 1 11 62 19 81 Asset Impairments and Write-offs: Property, plant and equipment — — — 19 1 20 153 3 156 Inventory 2 — 2 — — — 106 — 106 Goodwill and other assets — — — (1 ) — (1 ) 189 20 209 Total Restructuring Charges, Net $ 12 $ 8 $ 20 $ (6 ) $ — $ (6 ) $ 807 $ 59 $ 866 | |
Schedule of Restructuring Reserve by Type of Cost | The following table summarizes the activities related to the company’s 2015 Restructuring Plan. (Dollars in millions) Work Force Reductions (1) Facility Closures/Exit Costs (2) Asset Impairments and Write-offs Total Ending Liability as of Aug. 31, 2016 $ 244 $ — $ — $ 244 Net restructuring charges recognized in fiscal year 2017 (81 ) 24 46 (11 ) Cash payments (119 ) (22 ) — (141 ) Asset impairments and write-offs — — (46 ) (46 ) Ending Liability as of Aug. 31, 2017 $ 44 $ 2 $ — $ 46 Net restructuring charges recognized in first six months of fiscal year 2018 (11 ) 29 2 20 Cash payments (17 ) (29 ) — (46 ) Asset impairments and write-offs — — (2 ) (2 ) Ending Liability as of Feb. 28, 2018 $ 16 $ 2 $ — $ 18 (1) There was no long-term restructuring liability balance as of Feb. 28, 2018. The restructuring liability balance included $8 million of long-term liabilities that was recorded in other liabilities in the Statement of Consolidated Financial Position as of Aug. 31, 2017 . (2) There was no long-term restructuring liability balance as of Feb. 28, 2018. The restructuring liability balance included $1 million of long-term liabilities that was recorded in other liabilities in the Statement of Consolidated Financial Position as of Aug. 31, 2017. |
CUSTOMER FINANCING PROGRAMS (Ta
CUSTOMER FINANCING PROGRAMS (Tables) | 6 Months Ended |
Feb. 28, 2018 | |
CUSTOMER FINANCING PROGRAMS [Abstract] | |
Customer Financing Programs | 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. |
VARIABLE INTEREST ENTITIES (Tab
VARIABLE INTEREST ENTITIES (Tables) | 6 Months Ended |
Feb. 28, 2018 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Schedule of Equity Method Investments and Cost Method Investments | For such investments that were accounted for under the equity method and cost basis included in other assets in the Statements of Consolidated Financial Position, the amounts are summarized in the following table: As of (Dollars in millions) Feb. 28, 2018 Aug. 31, 2017 Equity Method Investments $ 163 $ 166 Cost Basis Investments 124 116 Total $ 287 $ 282 |
RECEIVABLES (Tables)
RECEIVABLES (Tables) | 6 Months Ended |
Feb. 28, 2018 | |
Receivables [Abstract] | |
Allowance For Doubtful Long Term Receivables | The following table displays a roll forward of the allowance for credit losses related to long-term customer receivables. (Dollars in millions) Balance as of Aug. 31, 2016 $ 228 Incremental provision 20 Recoveries (38 ) Write-offs (2 ) Reclassifications from allowance for current receivables 67 Foreign currency translation adjustments 2 Balance as of Aug. 31, 2017 $ 277 Incremental provision 7 Recoveries (1 ) Reclassifications from allowance for current receivables 1 Foreign currency translation adjustments (4 ) Balance as of Feb. 28, 2018 $ 280 |
INVENTORY (Tables)
INVENTORY (Tables) | 6 Months Ended |
Feb. 28, 2018 | |
Inventory Disclosure [Abstract] | |
Components of Inventory | Components of inventory are: As of (Dollars in millions) Feb. 28, 2018 Aug. 31, 2017 Finished Goods $ 1,964 $ 1,477 Goods In Process 1,466 1,446 Raw Materials and Supplies 743 561 Total 4,173 3,484 Adjustment of Inventories to a LIFO Basis (1) (158 ) (144 ) Total Inventories $ 4,015 $ 3,340 (1) Adjustment is for the United States Agricultural Productivity segment inventories. |
GOODWILL AND OTHER INTANGIBLE35
GOODWILL AND OTHER INTANGIBLE ASSETS (Tables) | 6 Months Ended |
Feb. 28, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Net Carrying Amount of Goodwill | Changes in the net carrying amount of goodwill for the first six months of fiscal year 2018 , by segment, are as follows: (Dollars in millions) Seeds and Genomics Agricultural Productivity Total Balance as of Aug. 31, 2017 $ 4,039 $ 49 $ 4,088 Effect of foreign currency translation and other adjustments 12 — 12 Balance as of Feb. 28, 2018 $ 4,051 $ 49 $ 4,100 |
Other Intangible Assets Information | Information regarding the company’s other intangible assets is as follows: As of Feb. 28, 2018 As of Aug. 31, 2017 (Dollars in millions) Carrying Amount Accumulated Amortization Net Carrying Amount Accumulated Amortization Net Acquired Germplasm $ 1,080 $ (827 ) $ 253 $ 1,077 $ (814 ) $ 263 Acquired Intellectual Property 1,079 (700 ) 379 1,079 (671 ) 408 Trademarks 336 (171 ) 165 335 (165 ) 170 Customer Relationships 293 (237 ) 56 291 (228 ) 63 Other 75 (44 ) 31 68 (40 ) 28 Total Other Intangible Assets, Finite Lives $ 2,863 $ (1,979 ) $ 884 $ 2,850 $ (1,918 ) $ 932 In Process Research & Development, Indefinite Lives 93 — 93 92 — 92 Total Other Intangible Assets $ 2,956 $ (1,979 ) $ 977 $ 2,942 $ (1,918 ) $ 1,024 |
Intangible Assets Future Amortization Expense | The estimated intangible asset amortization expense for fiscal year 2018 through fiscal year 2022 is as follows: (Dollars in millions) Amount 2018 $ 111 2019 111 2020 110 2021 108 2022 103 |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 6 Months Ended |
Feb. 28, 2018 | |
Fair Value Disclosures [Abstract] | |
Assets and Liabilities Measured at Fair Value on a Recurring Basis | The following tables set forth by level Monsanto’s assets and liabilities disclosed at fair value on a recurring basis as of Feb. 28, 2018 , and Aug. 31, 2017 . As required by the Fair Value Measurements and Disclosures topic of the ASC, assets and liabilities are classified in their entirety based on the lowest level of input that is a significant component of the fair value measurement. Monsanto’s assessment of the significance of a particular input to the fair value measurement requires judgment and may affect the classification of fair value assets and liabilities within the fair value hierarchy levels. Fair Value Measurements at Feb. 28, 2018, Using (Dollars in millions) Level 1 Level 2 Level 3 Net Balance Assets at Fair Value: Cash equivalents $ 2,150 $ — $ — $ 2,150 Short-term investments 5 — — 5 Equity securities 6 — — 6 Derivative assets related to: Foreign currency contracts — 3 — 3 Commodity contracts 18 9 — 27 Total Assets at Fair Value $ 2,179 $ 12 $ — $ 2,191 Liabilities at Fair Value: Short-term debt instruments (1) $ — $ 1,210 $ 2 $ 1,212 Long-term debt instruments (1) — 6,653 97 6,750 Derivative liabilities related to: Foreign currency contracts — 15 — 15 Commodity contracts 9 7 — 16 Total Liabilities at Fair Value $ 9 $ 7,885 $ 99 $ 7,993 (1) Debt instruments, excluding mandatorily redeemable shares, are not recorded at fair value on a recurring basis; however, they are measured at fair value for disclosure purposes, as required by the Fair Value Measurements and Disclosures topic of the ASC. Fair Value Measurements at Aug. 31, 2017, Using (Dollars in millions) Level 1 Level 2 Level 3 Net Balance Assets at Fair Value: Cash equivalents $ 1,034 $ — $ — $ 1,034 Short-term investments 8 — — 8 Equity securities 10 — — 10 Derivative assets related to: Foreign currency contracts — 10 — 10 Commodity contracts 3 7 — 10 Total Assets at Fair Value $ 1,055 $ 17 $ — $ 1,072 Liabilities at Fair Value: Short-term debt instruments (1) $ — $ 877 $ — $ 877 Long-term debt instruments (1) — 7,499 104 7,603 Derivative liabilities related to: Foreign currency contracts — 16 — 16 Commodity contracts 7 6 — 13 Total Liabilities at Fair Value $ 7 $ 8,398 $ 104 $ 8,509 (1) Debt instruments, excluding mandatorily redeemable shares, are not recorded at fair value on a recurring basis; however, they are measured at fair value for disclosure purposes, as required by the Fair Value Measurements and Disclosures topic of the ASC. |
Level 3 Rollforward | The following table summarizes the change in fair value of the Level 3 short-term debt instrument for the six months ended Feb. 28, 2018 . (Dollars in millions) Balance Aug. 31, 2017 $ — Reclass from long-term 2 Balance Feb. 28, 2018 (1) $ 2 (1) Includes interest on 315,000 mandatorily redeemable shares outstanding with a par value of 1,000 Brazilian reais (approximately $308 ) as of Feb. 28, 2018 . The following table summarizes the change in fair value of the Level 3 long-term debt instrument for the six months ended Feb. 28, 2018 . (Dollars in millions) Balance Aug. 31, 2017 $ 104 Reclass to short-term (2 ) Accretion expense 3 Payments (5 ) Effect of foreign currency translation adjustments (3 ) Balance Feb. 28, 2018 (1) $ 97 (1) Includes 315,000 mandatorily redeemable shares outstanding with a par value of 1,000 Brazilian reais (approximately $308 ) as of Feb. 28, 2018 . |
FINANCIAL INSTRUMENTS (Tables)
FINANCIAL INSTRUMENTS (Tables) | 6 Months Ended |
Feb. 28, 2018 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Instruments (Notional Amounts) | The notional amounts of the company’s derivative instruments outstanding as of Feb. 28, 2018 , and Aug. 31, 2017 , are as follows: As of (Dollars in millions) Feb. 28, 2018 Aug. 31, 2017 Derivatives Designated as Hedges: Foreign exchange contracts $ 299 $ 453 Commodity contracts 621 430 Total Derivatives Designated as Hedges $ 920 $ 883 Derivatives Not Designated as Hedges: Foreign exchange contracts $ 1,709 $ 2,133 Commodity contracts 161 189 Interest rate contracts 7 21 Total Derivatives Not Designated as Hedges $ 1,877 $ 2,343 |
Fair Values of Derivative Instruments | The net presentation of the company’s derivative instruments outstanding was as follows: As of Feb. 28, 2018 (Dollars in millions) Gross Amounts Recognized Gross Amounts Offset in the Statement of Consolidated Financial Position Net Amounts Included in the Statement of Consolidated Financial Position Collateral Pledged Net Amounts Reported in the Statement of Consolidated Financial Position Other Items Included in the Statement of Consolidated Financial Position Statement of Consolidated Financial Position Balance Asset Derivatives: Other current assets Derivatives designated as hedges: Commodity contracts (1) $ 18 $ (9 ) $ 9 $ — $ 9 Derivatives not designated as hedges: Commodity contracts 8 — 8 — 8 Foreign exchange contracts 3 — 3 — 3 Total other current assets 29 (9 ) 20 — 20 $ 290 $ 310 Other assets Derivatives designated as hedges: Commodity contracts 1 — 1 — 1 Total other assets 1 — 1 — 1 891 892 Total Asset Derivatives $ 30 $ (9 ) $ 21 $ — $ 21 Liability Derivatives: Other current assets Derivatives designated as hedges: Commodity contracts (1) $ 9 $ (9 ) $ — $ — $ — Total other current assets 9 (9 ) — — — Miscellaneous short-term accruals Derivatives designated as hedges: Commodity contracts 1 — 1 — 1 Foreign exchange contracts 6 — 6 — 6 Derivatives not designated as hedges: Commodity contracts 6 — 6 — 6 Foreign exchange contracts 9 — 9 — 9 Total miscellaneous short-term accruals 22 — 22 — 22 $ 680 $ 702 Total Liability Derivatives $ 31 $ (9 ) $ 22 $ — $ 22 (1) As allowed by the Derivatives and Hedging topic of the ASC, commodity derivative assets and liabilities have been offset by collateral subject to an enforceable master netting arrangement or similar arrangement. Therefore, these commodity contracts that are in an asset or liability position are included in asset accounts within the Statements of Consolidated Financial Position. As of Aug. 31, 2017 (Dollars in millions) Gross Amounts Recognized Gross Amounts Offset in the Statement of Consolidated Financial Position Net Amounts Included in the Statement of Consolidated Financial Position Collateral Pledged Net Amounts Reported in the Statement of Consolidated Financial Position Other Items Included in the Statement of Consolidated Financial Position Statement of Consolidated Financial Position Balance Asset Derivatives: Other current assets Derivatives designated as hedges: Commodity contracts (1) $ 2 $ (7 ) $ (5 ) $ 5 $ — Derivatives not designated as hedges: Commodity contracts 6 — 6 — 6 Foreign exchange contracts 10 — 10 — 10 Total other current assets 18 (7 ) 11 5 16 $ 252 $ 268 Other assets Derivatives designated as hedges: Commodity contracts 1 — 1 — 1 Total other assets 1 — 1 — 1 954 955 Miscellaneous short-term accruals Derivatives designated as hedges: Commodity contracts (1) 1 (1 ) — — — Total miscellaneous short-term accruals 1 (1 ) — — — Total Asset Derivatives $ 20 $ (8 ) $ 12 $ 5 $ 17 Liability Derivatives: Other current assets Derivatives designated as hedges: Commodity contracts (1) $ 7 $ (7 ) $ — $ — $ — Total other current assets 7 (7 ) — — — Miscellaneous short-term accruals Derivatives designated as hedges: Commodity contracts (1) 3 (1 ) 2 — 2 Foreign currency contracts 14 — 14 — 14 Derivatives not designated as hedges: Commodity contracts 3 — 3 — 3 Foreign exchange contracts 2 — 2 — 2 Total miscellaneous short-term accruals 22 (1 ) 21 — 21 $ 719 $ 740 Total Liability Derivatives $ 29 $ (8 ) $ 21 $ — $ 21 (1) As allowed by the Derivatives and Hedging topic of the ASC, commodity derivative assets and liabilities have been offset by collateral subject to an enforceable master netting arrangement or similar arrangement. Therefore, these commodity contracts that are in an asset or liability position are included in asset accounts within the Statements of Consolidated Financial Position. |
Gains Losses of Derivative Instruments | The gains and losses on the company’s derivative instruments were as follows: Amount of Gain (Loss) Recognized in AOCL (1) (Effective Portion) Amount of Gain (Loss) Recognized in Income (2)(3) Three Months Ended Three Months Ended Statements of Consolidated Operations Classification (Dollars in millions) Feb. 28, 2018 Feb. 28, 2017 Feb. 28, 2018 Feb. 28, 2017 Derivatives Designated as Hedges: Fair value hedges: Commodity contracts $ (9 ) $ 3 Cost of goods sold Cash flow hedges: Foreign currency contracts $ (2 ) $ 3 1 3 Net sales Foreign currency contracts — 1 — 1 Cost of goods sold Commodity contracts 12 10 1 (12 ) Cost of goods sold Interest rate contracts — (1 ) (4 ) (4 ) Interest expense Total Derivatives Designated as Hedges 10 13 (11 ) (9 ) Derivatives Not Designated as Hedges: Foreign currency contracts (4) (3 ) 26 Other income, net Commodity contracts (1 ) 1 Net sales Commodity contracts 1 — Cost of goods sold Total Derivatives Not Designated as Hedges (3 ) 27 Total Derivatives $ 10 $ 13 $ (14 ) $ 18 (1) Accumulated other comprehensive loss (AOCL) (2) For derivatives designated as cash flow hedges under the Derivatives and Hedging topic of the ASC, this represents the effective portion of the gain (loss) reclassified from AOCL into income during the period. (3) The gain or loss on derivatives designated as hedges from ineffectiveness is not significant during the three months ended Feb. 28, 2018 , and Feb. 28, 2017 . No gains or losses were excluded from the assessment of hedge effectiveness during the three months ended Feb. 28, 2018 , and Feb. 28, 2017 . (4) Gain or loss on foreign currency contracts not designated as hedges was offset by a foreign currency transaction loss of $41 million and $21 million during the three months ended Feb. 28, 2018 , and Feb. 28, 2017 , respectively. Amount of Gain (Loss) Recognized in AOCL (1) (Effective Portion) Amount of Gain (Loss) Recognized in Income (2)(3) Six Months Ended Six Months Ended Statements of Consolidated Operations Classification (Dollars in millions) Feb. 28, 2018 Feb. 28, 2017 Feb. 28, 2018 Feb. 28, 2017 Derivatives Designated as Hedges: Fair value hedges: Commodity contracts $ (8 ) $ (10 ) Cost of goods sold Cash flow hedges: Foreign currency contracts $ 7 $ 20 3 10 Net sales Foreign currency contracts — 7 — 2 Cost of goods sold Commodity contracts 14 29 — (15 ) Cost of goods sold Interest rate contracts — — — (37 ) Other income, net Interest rate contracts — 3 (7 ) (8 ) Interest expense Total Derivatives Designated as Hedges 21 59 (12 ) (58 ) Derivatives Not Designated as Hedges: Foreign currency contracts (4) 8 (19 ) Other income, net Commodity contracts (2 ) 1 Net sales Commodity contracts 1 (1 ) Cost of goods sold Total Derivatives Not Designated as Hedges 7 (19 ) Total Derivatives $ 21 $ 59 $ (5 ) $ (77 ) (1) Accumulated other comprehensive loss (AOCL) (2) For derivatives designated as cash flow hedges under the Derivatives and Hedging topic of the ASC, this represents the effective portion of the gain (loss) reclassified from AOCL into income during the period. (3) The gain or loss on derivatives designated as hedges from ineffectiveness is not significant during the six months ended Feb. 28, 2018 , and Feb. 28, 2017 . No gains or losses were excluded from the assessment of hedge effectiveness during the six months ended Feb. 28, 2018 , and Feb. 28, 2017 . (4) Gain or loss on foreign currency contracts not designated as hedges was offset by a foreign currency transaction loss of $43 million and a gain of $18 million during the six months ended Feb. 28, 2018 , and Feb. 28, 2017 , respectively. |
POSTRETIREMENT BENEFITS - PEN38
POSTRETIREMENT BENEFITS - PENSIONS, HEALTH CARE AND OTHER (Tables) | 6 Months Ended |
Feb. 28, 2018 | |
Retirement Benefits [Abstract] | |
Components of Net Periodic Benefit Cost | Pension Benefits Three Months Ended Feb. 28, 2018 Three Months Ended Feb. 28, 2017 (Dollars in millions) U.S. Outside the U.S. Total U.S. Outside the U.S. Total Service Cost for Benefits Earned During the Period $ 14 $ 3 $ 17 $ 15 $ 3 $ 18 Interest Cost on Benefit Obligation 22 1 23 20 1 21 Assumed Return on Plan Assets (43 ) (2 ) (45 ) (43 ) (2 ) (45 ) Amortization of Unrecognized Net Loss 10 1 11 12 1 13 Restructuring Charges — — — — 2 2 Total Net Periodic Benefit Cost $ 3 $ 3 $ 6 $ 4 $ 5 $ 9 Pension Benefits Six Months Ended Feb. 28, 2018 Six Months Ended Feb. 28, 2017 (Dollars in millions) U.S. Outside the U.S. Total U.S. Outside the U.S. Total Service Cost for Benefits Earned During the Period $ 28 $ 6 $ 34 $ 30 $ 6 $ 36 Interest Cost on Benefit Obligation 44 3 47 41 3 44 Assumed Return on Plan Assets (86 ) (5 ) (91 ) (85 ) (4 ) (89 ) Amortization of Unrecognized Net Loss 20 2 22 24 2 26 Restructuring Charges — — — — 2 2 Total Net Periodic Benefit Cost $ 6 $ 6 $ 12 $ 10 $ 9 $ 19 |
Net Periodic Cost Postretirement | Health Care and Other Postretirement Benefits Three Months Ended (Dollars in millions) Feb. 28, 2018 Feb. 28, 2017 Service Cost for Benefits Earned During the Period $ 2 $ 2 Interest Cost on Benefit Obligation 1 1 Amortization of Unrecognized Net (Gain)/Loss (1 ) 2 Restructuring Charges — 2 Total Net Periodic Benefit Cost $ 2 $ 7 Health Care and Other Postretirement Benefits Six Months Ended (Dollars in millions) Feb. 28, 2018 Feb. 28, 2017 Service Cost for Benefits Earned During the Period $ 4 $ 3 Interest Cost on Benefit Obligation 2 2 Amortization of Unrecognized Net (Gain)/Loss (2 ) 3 Restructuring Charges — 2 Total Net Periodic Benefit Cost $ 4 $ 10 |
STOCK BASED COMPENSATION PLAN39
STOCK BASED COMPENSATION PLANS (Tables) | 6 Months Ended |
Feb. 28, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Components of Stock Based Compensation | The following table shows total stock-based compensation expense included in the Statements of Consolidated Operations for the three and six months ended Feb. 28, 2018 , and Feb. 28, 2017 . Three Months Ended Six Months Ended (Dollars in millions) Feb. 28, 2018 Feb. 28, 2017 Feb. 28, 2018 Feb. 28, 2017 Cost of Goods Sold $ 4 $ 4 $ 8 $ 7 Selling, General and Administrative Expenses 18 19 43 45 Research and Development Expenses 6 7 12 13 Restructuring Charges — — — 1 Pre-Tax Stock-Based Compensation Expense 28 30 63 66 Income Tax Benefit (2 ) (10 ) (18 ) (23 ) Net Stock-Based Compensation Expense $ 26 $ 20 $ 45 $ 43 |
ACCUMULATED OTHER COMPREHENSI40
ACCUMULATED OTHER COMPREHENSIVE LOSS (Tables) | 6 Months Ended |
Feb. 28, 2018 | |
Equity [Abstract] | |
Components of Accumulated Other Comprehensive Income | The following table sets forth the after-tax components of accumulated other comprehensive loss and changes thereto: (Dollars in millions) Foreign Currency Translation Adjustments Postretirement Benefit Items Net Unrealized Gain (Loss) on Available-for-Sale Securities Cash Flow Hedges Total Accumulated Other Comprehensive (Loss) Income Balance as of Aug. 31, 2016 $ (2,292 ) $ (340 ) $ 1 $ (177 ) $ (2,808 ) Other comprehensive income (loss) before reclassifications 233 55 (2 ) 21 307 Amounts reclassified from accumulated other comprehensive loss — 38 2 34 74 Net current-period other comprehensive income 233 93 — 55 381 Balance as of Aug. 31, 2017 $ (2,059 ) $ (247 ) $ 1 $ (122 ) $ (2,427 ) Other comprehensive income (loss) before reclassifications 25 (48 ) (1 ) (11 ) (35 ) Amounts reclassified from accumulated other comprehensive loss (income) — 15 (1 ) 3 17 Net current-period other comprehensive income (loss) 25 (33 ) (2 ) (8 ) (18 ) Balance as of Feb. 28, 2018 $ (2,034 ) $ (280 ) $ (1 ) $ (130 ) $ (2,445 ) |
Reclassification out of Accumulated Other Comprehensive Income [Table Text Block] | The following table provides additional information regarding items reclassified out of accumulated other comprehensive loss into earnings. Three Months Ended Six Months Ended (Dollars in millions) Feb. 28, 2018 Feb. 28, 2017 Feb. 28, 2018 Feb. 28, 2017 Affected Line Item in the Statements of Consolidated Operations Available for Sale Securities: (Gain) Loss on Equity Security $ (1 ) $ 2 $ (1 ) $ 2 Other income, net (1 ) 2 (1 ) 2 Total before income taxes — (1) — (1) Income tax provision $ (1 ) $ 1 $ (1 ) $ 1 Net of tax Cash Flow Hedges: Foreign Exchange Contracts $ (1 ) $ (3 ) $ (3 ) $ (10 ) Net sales Foreign Exchange Contracts — (1 ) — (2 ) Cost of goods sold Commodity Contracts (1 ) 12 — 15 Cost of goods sold Interest Rate Contracts — — — 37 Other income, net Interest Rate Contracts 4 4 7 8 Interest expense 2 12 4 48 Total before income taxes (1 ) (4 ) (1 ) (19 ) Income tax provision $ 1 $ 8 $ 3 $ 29 Net of tax Postretirement Benefit Items: Amortization of Unrecognized Net Loss $ 3 $ 5 $ 7 $ 11 Inventory/Cost of goods sold (1) Amortization of Unrecognized Net Loss 7 10 13 20 Selling, general and administrative expenses Amortization of Unrecognized Net Loss — 4 — 4 Restructuring charges 10 19 20 35 Total before income taxes (1 ) (6 ) (5 ) (12 ) Income tax provision $ 9 $ 13 $ 15 $ 23 Net of tax Total Reclassifications For The Period $ 9 $ 22 $ 17 $ 53 Net of tax (1) The amortization of unrecognized net loss is recorded to net periodic benefit cost, which is allocated to selling, general and administrative expenses and to inventory, which is recognized through cost of goods sold. The company recorded $3 million and $5 million of net periodic benefit cost to inventory, of which approximately $2 million and $3 million was recognized in cost of goods sold during the three months ended Feb. 28, 2018 , and Feb. 28, 2017 , respectively. The company recorded $7 million and $11 million of net periodic benefit cost to inventory, of which approximately $7 million and $10 million was recognized in cost of goods sold during the six months ended Feb. 28, 2018 , and Feb. 28, 2017 , respectively. See Note 14 — Postretirement Benefits - Pensions, Health Care and Other — for additional information. |
EARNINGS PER SHARE (Tables)
EARNINGS PER SHARE (Tables) | 6 Months Ended |
Feb. 28, 2018 | |
Earnings Per Share [Abstract] | |
Basic Earnings Per Share Table | Three Months Ended Six Months Ended (Shares in millions) Feb. 28, 2018 Feb. 28, 2017 Feb. 28, 2018 Feb. 28, 2017 Weighted-Average Number of Common Shares 441.0 438.7 440.6 438.4 Dilutive Potential Common Shares 4.5 3.6 5.3 3.9 Antidilutive Potential Common Shares 0.1 2.2 0.1 4.0 |
SUPPLEMENTAL CASH FLOW INFORM42
SUPPLEMENTAL CASH FLOW INFORMATION SUPPLEMENTAL CASH FLOW INFORMATION (Tables) | 6 Months Ended |
Feb. 28, 2018 | |
Supplemental Cash Flow Information [Abstract] | |
Cash Payments For Interest And Taxes | Cash payments for interest and taxes were as follows: Six Months Ended (Dollars in millions) Feb. 28, 2018 Feb. 28, 2017 Interest $ 235 $ 225 Taxes 229 187 |
SEGMENT AND GEOGRAPHIC DATA (Ta
SEGMENT AND GEOGRAPHIC DATA (Tables) | 6 Months Ended |
Feb. 28, 2018 | |
Segment Reporting [Abstract] | |
Operating Segment Information | Data for the Seeds and Genomics and Agricultural Productivity reportable segments, as well as for Monsanto’s significant operating segments, is presented in the table as follows: Three Months Ended Six Months Ended (Dollars in millions) Feb. 28, 2018 Feb. 28, 2017 Feb. 28, 2018 Feb. 28, 2017 Net Sales (1) Corn seed and traits $ 2,721 $ 2,902 $ 3,508 $ 3,851 Soybean seed and traits 912 862 1,640 1,462 Cotton seed and traits 123 108 243 224 Vegetable seeds 198 193 312 324 All other crops seeds and traits 134 121 155 173 Total Seeds and Genomics $ 4,088 $ 4,186 $ 5,858 $ 6,034 Agricultural productivity 931 888 1,819 1,690 Total Agricultural Productivity $ 931 $ 888 $ 1,819 $ 1,690 Total $ 5,019 $ 5,074 $ 7,677 $ 7,724 Gross Profit Corn seed and traits $ 1,790 $ 1,932 $ 2,205 $ 2,467 Soybean seed and traits 672 628 1,260 1,079 Cotton seed and traits 101 77 174 150 Vegetable seeds 93 99 151 168 All other crops seeds and traits 81 41 79 53 Total Seeds and Genomics $ 2,737 $ 2,777 $ 3,869 $ 3,917 Agricultural productivity 229 175 409 294 Total Agricultural Productivity $ 229 $ 175 $ 409 $ 294 Total $ 2,966 $ 2,952 $ 4,278 $ 4,211 EBIT (2)(3)(4) Seeds and Genomics $ 1,779 $ 1,839 $ 2,081 $ 2,038 Agricultural Productivity 143 119 181 132 Total $ 1,922 $ 1,958 $ 2,262 $ 2,170 Depreciation and Amortization Expense Seeds and Genomics $ 152 $ 142 $ 301 $ 285 Agricultural Productivity 41 41 80 87 Total $ 193 $ 183 $ 381 $ 372 (1) Represents net sales from continuing operations. (2) EBIT is defined as earnings (loss) before interest and taxes; see the following table for reconciliation. Earnings (loss) is intended to mean net income (loss) attributable to Monsanto Company as presented in the Statements of Consolidated Operations under U.S. GAAP. EBIT is an operating performance measure for the two reportable segments. (3) Agricultural Productivity EBIT includes income from operations of discontinued businesses of $2 million and $5 million for the three months ended Feb. 28, 2018, and Feb. 28, 2017, respectively. Agricultural Productivity EBIT includes income from operations of discontinued businesses of $4 million and $21 million for the six months ended Feb. 28, 2018 , and Feb. 28, 2017 , respectively. (4) Seeds and Genomics EBIT includes a loss from operations of noncontrolling interests of $2 million for the three months ended Feb. 28, 2017. Agricultural Productivity EBIT includes income from operations of noncontrolling interests of $1 million for the three months ended Feb. 28, 2018 , and Feb. 28, 2017. Seeds and Genomics EBIT includes income from operations of noncontrolling interests of $2 million and $6 million for the six months ended Feb. 28, 2018, and Feb. 28, 2017, respectively. Agricultural Productivity EBIT includes income from operations of noncontrolling interests of $1 million for the six months ended Feb. 28, 2018, and Feb. 28, 2017. |
The reconciliation of EBIT to Net Income | A reconciliation of EBIT to net income attributable to Monsanto Company for each period is as follows: Three Months Ended Six Months Ended (Dollars in millions) Feb. 28, 2018 Feb. 28, 2017 Feb. 28, 2018 Feb. 28, 2017 EBIT (1) $ 1,922 $ 1,958 $ 2,262 $ 2,170 Interest Expense — Net 81 84 190 202 Income Tax Provision (2) 382 506 444 571 Net Income Attributable to Monsanto Company $ 1,459 $ 1,368 $ 1,628 $ 1,397 (1) Includes the income from operations of discontinued businesses and the income (loss) from operations of noncontrolling interests. (2) Includes the income tax provision on discontinued operations and the income tax provision (benefit) of noncontrolling interests. |
BACKGROUND AND BASIS OF PRESE44
BACKGROUND AND BASIS OF PRESENTATION (Details) $ in Millions | Oct. 01, 2008 | Feb. 28, 2018USD ($) | Nov. 30, 2017USD ($) | Feb. 28, 2017USD ($) | Feb. 28, 2018USD ($)segment | Feb. 28, 2017USD ($) | Aug. 31, 2017USD ($) | Jul. 25, 2017USD ($) |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||||
Number of Reportable Segments | segment | 2 | |||||||
Earn-out period, length of time | 10 years | |||||||
Gain on disposal | $ 118 | $ 83 | ||||||
Other income | $ 24 | $ 88 | 121 | 45 | ||||
Disposal Group, Held-for-sale, Not Discontinued Operations [Member] | ||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||||
Other income | 50 | 83 | ||||||
Agricultural Productivity [Member] | Disposal Group, Held-for-sale, Not Discontinued Operations [Member] | ||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||||
Other income | $ 50 | 50 | ||||||
Seeds And Genomics [Member] | Disposal Group, Held-for-sale, Not Discontinued Operations [Member] | ||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||||
Other income | $ 33 | |||||||
Precision Planting [Member] | Disposal Group, Held-for-sale, Not Discontinued Operations [Member] | ||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||||
Consideration | $ 200 | |||||||
Gain on disposal | $ 52 | |||||||
Precision Planting [Member] | Other Current Assets [Member] | Disposal Group, Held-for-sale, Not Discontinued Operations [Member] | ||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||||
Assets | $ 156 | |||||||
Precision Planting [Member] | Other Current Liabilities [Member] | Disposal Group, Held-for-sale, Not Discontinued Operations [Member] | ||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||||
Liabilities | $ 12 | |||||||
Silthiofam [Member] | ||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||||
Consideration | 140 | 140 | ||||||
Silthiofam [Member] | Disposal Group, Held-for-sale, Not Discontinued Operations [Member] | ||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||||
Assets | 2 | $ 2 | ||||||
Other income | 85 | |||||||
Silthiofam [Member] | Disposal Group, Held-for-sale, Not Discontinued Operations [Member] | Contingent On Silthiofam Re-Registration [Member] | ||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||||
Other income | $ 55 |
NEW ACCOUNTING STANDARDS (Detai
NEW ACCOUNTING STANDARDS (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended |
Feb. 28, 2018 | Feb. 28, 2018 | |
NEW ACCOUNTING STANDARDS [Abstract] | ||
Reclassification of income from AOCI into retained earnings due to change in corporate income tax rate | $ 68 | $ 68 |
RESTRUCTURING - Schedule of res
RESTRUCTURING - Schedule of restructuring charges recored in the statement of consolidated operations (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||||
Feb. 28, 2018 | Feb. 28, 2017 | Feb. 28, 2018 | Feb. 28, 2017 | |||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring charges | $ (1) | $ 23 | $ 3 | $ (13) | ||
Cost of Sales [Member] | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring charges | [1] | 4 | 6 | 17 | 7 | |
Restructuring Charges [Member] | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring charges | [1] | (1) | 23 | 3 | (13) | |
Income (Loss) from Continuing Operations before Income Taxes [Member] | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring charges | 3 | 29 | 20 | (6) | ||
Income Tax (Expense) Benefit [Member] | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring charges | (15) | (15) | (23) | (5) | ||
Net Income (Loss) [Member] | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring charges | (12) | 14 | (3) | (11) | ||
Seeds And Genomics [Member] | Cost of Sales [Member] | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring charges | 5 | 10 | 6 | |||
Seeds And Genomics [Member] | Restructuring Charges [Member] | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring charges | 1 | (22) | (2) | 12 | ||
Agricultural Productivity [Member] | Cost of Sales [Member] | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring charges | $ 4 | [1] | 1 | 7 | 1 | |
Agricultural Productivity [Member] | Restructuring Charges [Member] | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring charges | $ (1) | $ (1) | $ 1 | |||
[1] | (1)For the three months ended Feb. 28, 2018, $4 million of restructuring charges in cost of goods sold was recorded in the Agricultural Productivity segment. For the three months ended Feb. 28, 2017, $6 million of restructuring charges in cost of goods sold was split by segment as follows: $5 million in Seeds and Genomics and $1 million in Agricultural Productivity. For the six months ended Feb. 28, 2018, $17 million of restructuring charges in cost of goods sold was split by segment as follows: $10 million in Seeds and Genomics and $7 million in Agricultural Productivity. For the six months ended Feb. 28, 2017, $7 million of restructuring charges in cost of goods sold was split by segment as follows: $6 million in Seeds and Genomics and $1 million in Agricultural Productivity. |
RESTRUCTURING - Pretax restruct
RESTRUCTURING - Pretax restructuring charges related to 2015 restructuring (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | 12 Months Ended | 30 Months Ended | ||
Feb. 28, 2018 | Feb. 28, 2017 | Feb. 28, 2018 | Feb. 28, 2017 | Aug. 31, 2017 | Feb. 28, 2018 | |
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring charges | $ (1) | $ 23 | $ 3 | $ (13) | ||
Restructuring Plan 2015 [Member] | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring charges | 3 | 29 | 20 | (6) | $ (11) | $ 866 |
Employee Severance [Member] | Restructuring Plan 2015 [Member] | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring charge reversal | 8 | 12 | 14 | 57 | ||
Restructuring charges | (7) | 2 | (11) | (36) | (81) | 314 |
Facility Closing [Member] | Restructuring Plan 2015 [Member] | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring charges | 10 | 9 | 29 | 11 | 24 | 81 |
Impairment Of Asset [Member] | Restructuring Plan 2015 [Member] | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring charges | 2 | $ 46 | ||||
Impairment in value of Property, Plant and Equipment [Member] | Restructuring Plan 2015 [Member] | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring charges | 0 | 19 | 0 | 20 | 156 | |
Inventory Valuation and Obsolescence [Member] | Restructuring Plan 2015 [Member] | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring charges | 0 | (1) | 2 | 0 | 106 | |
Goodwill and Other Assets [Member] | Restructuring Plan 2015 [Member] | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring charges | 0 | 0 | 0 | (1) | 209 | |
Seeds And Genomics [Member] | Restructuring Plan 2015 [Member] | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring charges | (1) | 27 | 12 | (6) | 807 | |
Seeds And Genomics [Member] | Employee Severance [Member] | Restructuring Plan 2015 [Member] | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring charges | (6) | 2 | (10) | (34) | 297 | |
Seeds And Genomics [Member] | Facility Closing [Member] | Restructuring Plan 2015 [Member] | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring charges | 5 | 8 | 20 | 10 | 62 | |
Seeds And Genomics [Member] | Impairment in value of Property, Plant and Equipment [Member] | Restructuring Plan 2015 [Member] | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring charges | 0 | 18 | 0 | 19 | 153 | |
Seeds And Genomics [Member] | Inventory Valuation and Obsolescence [Member] | Restructuring Plan 2015 [Member] | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring charges | 0 | (1) | 2 | 0 | 106 | |
Seeds And Genomics [Member] | Goodwill and Other Assets [Member] | Restructuring Plan 2015 [Member] | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring charges | 0 | 0 | 0 | (1) | 189 | |
Agricultural Productivity [Member] | Restructuring Plan 2015 [Member] | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring charges | 4 | 2 | 8 | 0 | 59 | |
Agricultural Productivity [Member] | Employee Severance [Member] | Restructuring Plan 2015 [Member] | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring charges | (1) | 0 | (1) | (2) | 17 | |
Agricultural Productivity [Member] | Facility Closing [Member] | Restructuring Plan 2015 [Member] | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring charges | 5 | 1 | 9 | 1 | 19 | |
Agricultural Productivity [Member] | Impairment in value of Property, Plant and Equipment [Member] | Restructuring Plan 2015 [Member] | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring charges | 0 | 1 | 0 | 1 | 3 | |
Agricultural Productivity [Member] | Inventory Valuation and Obsolescence [Member] | Restructuring Plan 2015 [Member] | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring charges | 0 | 0 | 0 | 0 | 0 | |
Agricultural Productivity [Member] | Goodwill and Other Assets [Member] | Restructuring Plan 2015 [Member] | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring charges | 0 | $ 0 | 0 | $ 0 | 20 | |
Minimum [Member] | Restructuring Plan 2015 [Member] | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Estimated restructuring charges | 890 | 890 | 890 | |||
Minimum [Member] | Employee Severance [Member] | Restructuring Plan 2015 [Member] | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Estimated restructuring charges | 315 | 315 | 315 | |||
Minimum [Member] | Facility Closing [Member] | Restructuring Plan 2015 [Member] | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Estimated restructuring charges | 95 | 95 | 95 | |||
Minimum [Member] | Impairment Of Asset [Member] | Restructuring Plan 2015 [Member] | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Estimated restructuring charges | 480 | 480 | 480 | |||
Maximum [Member] | Restructuring Plan 2015 [Member] | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Estimated restructuring charges | 955 | 955 | 955 | |||
Maximum [Member] | Employee Severance [Member] | Restructuring Plan 2015 [Member] | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Estimated restructuring charges | 325 | 325 | 325 | |||
Maximum [Member] | Facility Closing [Member] | Restructuring Plan 2015 [Member] | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Estimated restructuring charges | 130 | 130 | 130 | |||
Maximum [Member] | Impairment Of Asset [Member] | Restructuring Plan 2015 [Member] | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Estimated restructuring charges | $ 500 | $ 500 | $ 500 |
RESTRUCTURING - Restructuring C
RESTRUCTURING - Restructuring Charges by Activity (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | 12 Months Ended | 30 Months Ended | |||
Feb. 28, 2018 | Feb. 28, 2017 | Feb. 28, 2018 | Feb. 28, 2017 | Aug. 31, 2017 | Feb. 28, 2018 | ||
Restructuring Reserve [Roll Forward] | |||||||
Restructuring charges | $ (1) | $ 23 | $ 3 | $ (13) | |||
Restructuring Plan 2015 [Member] | |||||||
Restructuring Reserve [Roll Forward] | |||||||
Beginning balance | 46 | 244 | $ 244 | ||||
Restructuring charges | 3 | 29 | 20 | (6) | (11) | $ 866 | |
Cash Payments | (46) | (141) | |||||
Asset impairments and write-offs | (2) | (46) | |||||
Ending balance | 18 | 18 | 46 | 18 | |||
Employee Severance [Member] | Restructuring Plan 2015 [Member] | |||||||
Restructuring Reserve [Roll Forward] | |||||||
Beginning balance | [1] | 44 | 244 | 244 | |||
Restructuring charges | (7) | 2 | (11) | (36) | (81) | 314 | |
Cash Payments | (17) | (119) | |||||
Asset impairments and write-offs | 0 | 0 | |||||
Ending balance | [1] | 16 | 16 | 44 | 16 | ||
Long-Term Restructuring Reserves | 0 | 0 | 8 | 0 | |||
Facility Closing [Member] | Restructuring Plan 2015 [Member] | |||||||
Restructuring Reserve [Roll Forward] | |||||||
Beginning balance | 2 | 0 | 0 | ||||
Restructuring charges | 10 | $ 9 | 29 | 11 | 24 | 81 | |
Cash Payments | (29) | (22) | |||||
Asset impairments and write-offs | 0 | 0 | |||||
Ending balance | 2 | 2 | 2 | 2 | |||
Long-Term Restructuring Reserves | 0 | 0 | 1 | 0 | |||
Impairment Of Asset [Member] | Restructuring Plan 2015 [Member] | |||||||
Restructuring Reserve [Roll Forward] | |||||||
Beginning balance | 0 | $ 0 | 0 | ||||
Restructuring charges | 2 | 46 | |||||
Cash Payments | 0 | 0 | |||||
Asset impairments and write-offs | (2) | (46) | |||||
Ending balance | $ 0 | $ 0 | $ 0 | $ 0 | |||
[1] | (1)There was no long-term restructuring liability balance as of Feb. 28, 2018. The restructuring liability balance included $8 million of long-term liabilities that was recorded in other liabilities in the Statement of Consolidated Financial Position as of Aug. 31, 2017. |
RESTRUCTURING - Narrative (Deta
RESTRUCTURING - Narrative (Details) - Restructuring Plan 2015 [Member] - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Feb. 28, 2018 | Feb. 28, 2017 | Feb. 28, 2018 | Feb. 28, 2017 | |
Employee Severance [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charge reversal | $ 8 | $ 12 | $ 14 | $ 57 |
Minimum [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Estimated restructuring charges | 890 | 890 | ||
Minimum [Member] | Employee Severance [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Estimated restructuring charges | 315 | 315 | ||
Minimum [Member] | Facility Closing [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Estimated restructuring charges | 95 | 95 | ||
Minimum [Member] | Impairment Of Asset [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Estimated restructuring charges | 480 | 480 | ||
Maximum [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Estimated restructuring charges | 955 | 955 | ||
Maximum [Member] | Employee Severance [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Estimated restructuring charges | 325 | 325 | ||
Maximum [Member] | Facility Closing [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Estimated restructuring charges | 130 | 130 | ||
Maximum [Member] | Impairment Of Asset [Member] | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Estimated restructuring charges | $ 500 | $ 500 |
CUSTOMER FINANCING PROGRAMS (De
CUSTOMER FINANCING PROGRAMS (Details) R$ in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | |||||
Feb. 28, 2018USD ($) | Feb. 28, 2017USD ($) | Feb. 28, 2018USD ($) | Feb. 28, 2018BRL (R$) | Feb. 28, 2017USD ($) | Aug. 31, 2017USD ($) | ||
US agreement to sell trade receivables [Member] | |||||||
Customer Financing Programs [Line Items] | |||||||
Outstanding balance | [1] | $ 47 | $ 47 | $ 539 | |||
Maximum future payout under recourse provisions | [1] | 15 | 15 | 21 | |||
Transactions that Qualify for Sales Treatment | [1] | 0 | $ 0 | 13 | $ 115 | ||
Maximum Amount of Potential Sales of Receivables | 1,400 | ||||||
Other agreements to sell trade receivables [Member] | |||||||
Customer Financing Programs [Line Items] | |||||||
Outstanding balance | [2] | 19 | 19 | 107 | |||
Maximum future payout under recourse provisions | [2] | 5 | 5 | 27 | |||
Transactions that Qualify for Sales Treatment | [2] | 7 | $ 5 | 15 | $ 11 | ||
Agreements With Lenders [Member] | |||||||
Customer Financing Programs [Line Items] | |||||||
Outstanding balance | [3] | 96 | 96 | 92 | |||
Maximum future payout under recourse provisions | [3] | $ 50 | 50 | $ 52 | |||
Brazil Revolving Financing Program [Member] | |||||||
Customer Financing Programs [Line Items] | |||||||
Maximum Amount of Potential Sales of Receivables | $ 108 | R$ 350 | |||||
[1] | Monsanto has agreements in the United States to sell trade receivables, both with and without recourse, up to a maximum outstanding balance of $1.4 billion and to service such accounts. These receivables qualify for sales treatment under the Transfers and Servicing topic of the ASC and, accordingly, the proceeds are included in net cash provided by operating activities in the Statements of Consolidated Cash Flows. The liability for the guarantees for sales with recourse is recorded at an amount that approximates fair value, based upon the company’s historical collection experience and a current assessment of credit exposure. | ||||||
[2] | Monsanto has various agreements in European and Latin American countries to sell trade receivables, both with and without recourse. These receivables qualify for sales treatment under the Transfers and Servicing topic of the ASC and, accordingly, the proceeds are included in net cash provided by operating activities in the Statements of Consolidated Cash Flows. The liability for the guarantees for sales with recourse is recorded at an amount that approximates fair value, based upon the company’s historical collection experience and a current assessment of credit exposure. | ||||||
[3] | Monsanto has additional agreements with lenders to establish programs that provide financing for select customers in the United States, Latin America and Europe. Monsanto provides various levels of recourse through guarantees of the accounts in the event of customer default. The term of the guarantee is equivalent to the term of the customer loans. The liability for the guarantees is recorded at an amount that approximates fair value, based on the company’s historical collection experience with customers that participate in the program and a current assessment of credit exposure. If performance is required under the guarantee, Monsanto may retain amounts that are subsequently collected from customers. |
VARIABLE INTEREST ENTITIES - Na
VARIABLE INTEREST ENTITIES - Narrative (Details) - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended |
Feb. 28, 2018 | Aug. 31, 2017 | |
Revolving Financing Programs [Line Items] | ||
Variable Interest Entity, Financial or Other Support, Percentage | 11.10% | |
Variable Interest Entity, Reporting Entity Involvement, Maximum Loss Exposure, Amount | $ 25 | $ 1 |
Senior Interest [Member] | ||
Revolving Financing Programs [Line Items] | ||
Variable Interest Entity, Qualitative or Quantitative Information, Ownership Percentage | 80.00% | 85.00% |
Monsanto Interest [Member] | ||
Revolving Financing Programs [Line Items] | ||
Variable Interest Entity, Qualitative or Quantitative Information, Ownership Percentage | 20.00% | 15.00% |
Herbicides [Member] | ||
Revolving Financing Programs [Line Items] | ||
Product Liability Contingency, Loss Exposure Not Accrued, Best Estimate | $ 29 | $ 29 |
VARIABLE INTEREST ENTITIES - Eq
VARIABLE INTEREST ENTITIES - Equity Method Investments and Cost Method Investments (Details) - USD ($) $ in Millions | Feb. 28, 2018 | Aug. 31, 2017 |
Equity Method Investments and Joint Ventures [Abstract] | ||
Equity Method Investments | $ 163 | $ 166 |
Cost Basis Investments | 124 | 116 |
Total | $ 287 | $ 282 |
RECEIVABLES (Details)
RECEIVABLES (Details) - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended | |
Feb. 28, 2018 | Aug. 31, 2017 | ||
Allowance For Doubtful Accounts Current [Abstract] | |||
Net allowances | $ 89 | $ 78 | |
Long Term Receivables [Abstract] | |||
Long term customer receivables, gross | 338 | 398 | |
Allowance for Doubtful Accounts Receivable [Roll Forward] | |||
Beginning Balance | 277 | 228 | |
Incremental Provision | 7 | 20 | |
Recoveries | (1) | (38) | |
Write-offs | (2) | ||
Allowance for Doubtful Accounts Receivable, Reclassification From Allowance For Current Receivables | 1 | 67 | |
Other | [1] | (4) | 2 |
Ending Balance | $ 280 | $ 277 | |
[1] | (Dollars in millions) Balance as of Aug. 31, 2016$228Incremental provision20Recoveries(38)Write-offs(2)Reclassifications from allowance for current receivables67Foreign currency translation adjustments2Balance as of Aug. 31, 2017$277Incremental provision7Recoveries(1)Reclassifications from allowance for current receivables1Foreign currency translation adjustments(4)Balance as of Feb. 28, 2018$280 |
INVENTORY (Details)
INVENTORY (Details) - USD ($) $ in Millions | Feb. 28, 2018 | Aug. 31, 2017 |
Inventory Disclosure [Abstract] | ||
Finished Goods | $ 1,964 | $ 1,477 |
Goods In Process | 1,466 | 1,446 |
Raw Materials and Supplies | 743 | 561 |
Inventory at FIFO Cost | 4,173 | 3,484 |
Excess of FIFO over LIFO Cost | (158) | (144) |
Total | $ 4,015 | $ 3,340 |
GOODWILL AND OTHER INTANGIBLE55
GOODWILL AND OTHER INTANGIBLE ASSETS Schedule of net carrying amount of goodwill (Details) $ in Millions | 6 Months Ended |
Feb. 28, 2018USD ($) | |
Goodwill [Roll Forward] | |
Balance as of Aug. 31, 2017 | $ 4,088 |
Effect of foreign currency translation and other adjustments | 12 |
Balance as of Feb. 28, 2018 | 4,100 |
Seeds And Genomics [Member] | |
Goodwill [Roll Forward] | |
Balance as of Aug. 31, 2017 | 4,039 |
Effect of foreign currency translation and other adjustments | 12 |
Balance as of Feb. 28, 2018 | 4,051 |
Agricultural Productivity [Member] | |
Goodwill [Roll Forward] | |
Balance as of Aug. 31, 2017 | 49 |
Effect of foreign currency translation and other adjustments | 0 |
Balance as of Feb. 28, 2018 | $ 49 |
GOODWILL AND OTHER INTANGIBLE56
GOODWILL AND OTHER INTANGIBLE ASSETS GOODWILL AND OTHER INTANGIBLE ASSETS Information of other intangible assets (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Feb. 28, 2018 | Feb. 28, 2017 | Feb. 28, 2018 | Feb. 28, 2017 | Aug. 31, 2017 | |
Acquired Finite-Lived Intangible Assets [Line Items] | |||||
Carrying Amount | $ 2,863 | $ 2,863 | $ 2,850 | ||
Accumulated Amortization | (1,979) | (1,979) | (1,918) | ||
Net | 884 | 884 | 932 | ||
Total Other Intangible Assets, Carrying Amount | 2,956 | 2,956 | 2,942 | ||
Other Intangible Assets, Net | 977 | 977 | 1,024 | ||
Amortization expense | 31 | $ 28 | 54 | $ 58 | |
Acquired Intellectual Property [Member] | |||||
Acquired Finite-Lived Intangible Assets [Line Items] | |||||
Carrying Amount | 1,079 | 1,079 | 1,079 | ||
Accumulated Amortization | (700) | (700) | (671) | ||
Net | 379 | 379 | 408 | ||
Acquired Germplasm [Member] | |||||
Acquired Finite-Lived Intangible Assets [Line Items] | |||||
Carrying Amount | 1,080 | 1,080 | 1,077 | ||
Accumulated Amortization | (827) | (827) | (814) | ||
Net | 253 | 253 | 263 | ||
Trademarks [Member] | |||||
Acquired Finite-Lived Intangible Assets [Line Items] | |||||
Carrying Amount | 336 | 336 | 335 | ||
Accumulated Amortization | (171) | (171) | (165) | ||
Net | 165 | 165 | 170 | ||
Customer Relationships [Member] | |||||
Acquired Finite-Lived Intangible Assets [Line Items] | |||||
Carrying Amount | 293 | 293 | 291 | ||
Accumulated Amortization | (237) | (237) | (228) | ||
Net | 56 | 56 | 63 | ||
Other Intangible Assets [Member] | |||||
Acquired Finite-Lived Intangible Assets [Line Items] | |||||
Carrying Amount | 75 | 75 | 68 | ||
Accumulated Amortization | (44) | (44) | (40) | ||
Net | 31 | 31 | 28 | ||
In Process Research and Development [Member] | |||||
Acquired Finite-Lived Intangible Assets [Line Items] | |||||
In Process Research & Development, Indefinite Lives | $ 93 | $ 93 | $ 92 |
GOODWILL AND OTHER INTANGIBLE57
GOODWILL AND OTHER INTANGIBLE ASSETS GOODWILL AND OTHER INTANGIBLE ASSETS Schedule of estimated amortization expense (Details) $ in Millions | Feb. 28, 2018USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
2,018 | $ 111 |
2,019 | 111 |
2,020 | 110 |
2,021 | 108 |
2,022 | $ 103 |
DEFERRED REVENUE (Details)
DEFERRED REVENUE (Details) - USD ($) $ in Millions | Feb. 28, 2018 | Aug. 31, 2017 |
Revenue Recognition and Deferred Revenue [Abstract] | ||
Deferred Revenue, Current | $ 1,686 | $ 727 |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended |
Feb. 28, 2018 | Aug. 31, 2018 | |
Income Taxes [Line Items] | ||
Provisional discrete tax benefit from change in enacted rate | $ 165 | |
Discrete tax expense from Transition Tax | 168 | |
Tax Cuts And Jobs Act Of 2017, Incomplete Accounting, Net Expense | 3 | |
Discrete tax benefit for various other adjustments | 47 | |
Total discrete tax benefit | 44 | |
U.S. State Tax [Member] | ||
Income Taxes [Line Items] | ||
Discrete tax expense from Transition Tax | $ 3 | |
Scenario, Forecast [Member] | ||
Income Taxes [Line Items] | ||
Blended rate | 25.70% |
DEBT AND OTHER CREDIT ARRANGE60
DEBT AND OTHER CREDIT ARRANGEMENTS (Details) - USD ($) | Jan. 29, 2018 | Feb. 28, 2018 | Aug. 31, 2017 | Oct. 31, 2016 | Apr. 30, 2016 | |||
Debt Instrument [Line Items] | ||||||||
Shelf registration, maximum aggregate amount | $ 6,000,000,000 | |||||||
Short-term Debt, Fair Value | [1] | $ 1,212,000,000 | $ 877,000,000 | |||||
Long-term Debt, Fair Value | 6,750,000,000 | [1] | $ 7,603,000,000 | [2] | ||||
Line of Credit [Member] | Revolving Credit Facility [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Credit facility, maximum borrowing capacity | 3,000,000,000 | |||||||
Line of Credit Facility, Fair Value of Amount Outstanding | 0 | |||||||
Line of Credit [Member] | Term Loan Facility [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Credit facility, maximum borrowing capacity | $ 1,000,000,000 | |||||||
Line of credit outstanding | $ 500,000,000 | |||||||
Senior Notes Due Twenty Forty Five [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt redeemed | $ 365,000,000 | |||||||
Interest rate | 4.30% | |||||||
[1] | Debt instruments, excluding mandatorily redeemable shares, are not recorded at fair value on a recurring basis; however, they are measured at fair value for disclosure purposes, as required by the Fair Value Measurements and Disclosures topic of the ASC. | |||||||
[2] | Debt instruments, excluding mandatorily redeemable shares, are not recorded at fair value on a recurring basis; however, they are measured at fair value for disclosure purposes, as required by the Fair Value Measurements and Disclosures topic of the ASC. |
FAIR VALUE MEASUREMENTS FAIR VA
FAIR VALUE MEASUREMENTS FAIR VALUE MEASUREMENTS Fair Value Hierarchy Levels (Details) - USD ($) $ in Millions | 6 Months Ended | |||||
Feb. 28, 2018 | Feb. 28, 2017 | Aug. 31, 2017 | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Cash equivalents | $ 2,150 | $ 1,034 | ||||
Short-term investments | 5 | 8 | ||||
Equity securities | 6 | 10 | ||||
Foreign currency contracts | 3 | 10 | ||||
Commodity contracts | 27 | 10 | ||||
Total Assets at Fair Value | 2,191 | 1,072 | ||||
Foreign currency contracts | 15 | 16 | ||||
Commodity contracts | 16 | 13 | ||||
Short-term Debt, Fair Value | [1] | 1,212 | 877 | |||
Long-term Debt, Fair Value | 6,750 | [1] | 7,603 | [2] | ||
Total Liabilities Recorded and Not Recorded at Fair Value | 7,993 | 8,509 | ||||
Assets, Fair Value Disclosure, Nonrecurring | 0 | |||||
Liabilities, Fair Value Adjustment | 0 | $ 0 | ||||
Fair Value, Inputs, Level 1 [Member] | ||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Cash equivalents | 2,150 | 1,034 | ||||
Short-term investments | 5 | 8 | ||||
Equity securities | 6 | 10 | ||||
Foreign currency contracts | 0 | 0 | ||||
Commodity contracts | 18 | 3 | ||||
Total Assets at Fair Value | 2,179 | 1,055 | ||||
Foreign currency contracts | 0 | 0 | ||||
Commodity contracts | 9 | 7 | ||||
Short-term Debt, Fair Value | 0 | [1] | 0 | |||
Long-term Debt, Fair Value | 0 | [1] | 0 | [2] | ||
Total Liabilities Recorded and Not Recorded at Fair Value | 9 | 7 | ||||
Fair Value, Inputs, Level 2 [Member] | ||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Cash equivalents | 0 | 0 | ||||
Short-term investments | 0 | 0 | ||||
Equity securities | 0 | 0 | ||||
Foreign currency contracts | 3 | 10 | ||||
Commodity contracts | 9 | 7 | ||||
Total Assets at Fair Value | 12 | 17 | ||||
Foreign currency contracts | 15 | 16 | ||||
Commodity contracts | 7 | 6 | ||||
Short-term Debt, Fair Value | 1,210 | [1] | 877 | |||
Long-term Debt, Fair Value | 6,653 | [1] | 7,499 | [2] | ||
Total Liabilities Recorded and Not Recorded at Fair Value | 7,885 | 8,398 | ||||
Fair Value, Inputs, Level 3 [Member] | ||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Cash equivalents | 0 | 0 | ||||
Short-term investments | 0 | 0 | ||||
Equity securities | 0 | 0 | ||||
Foreign currency contracts | 0 | 0 | ||||
Commodity contracts | 0 | 0 | ||||
Total Assets at Fair Value | 0 | 0 | ||||
Foreign currency contracts | 0 | 0 | ||||
Commodity contracts | 0 | 0 | ||||
Short-term Debt, Fair Value | 2 | [1] | 0 | |||
Long-term Debt, Fair Value | 97 | [1] | 104 | [2] | ||
Total Liabilities Recorded and Not Recorded at Fair Value | $ 99 | $ 104 | ||||
[1] | Debt instruments, excluding mandatorily redeemable shares, are not recorded at fair value on a recurring basis; however, they are measured at fair value for disclosure purposes, as required by the Fair Value Measurements and Disclosures topic of the ASC. | |||||
[2] | Debt instruments, excluding mandatorily redeemable shares, are not recorded at fair value on a recurring basis; however, they are measured at fair value for disclosure purposes, as required by the Fair Value Measurements and Disclosures topic of the ASC. |
FAIR VALUE MEASUREMENTS Summary
FAIR VALUE MEASUREMENTS Summary of the Change in Level 3 Liability (Details) $ / shares in Units, $ in Millions | 6 Months Ended | ||
Feb. 28, 2018USD ($)$ / sharesshares | Feb. 28, 2018R$ / sharesshares | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Mandatorily Redeemable Shares Outstanding | shares | 315,000 | 315,000 | |
Mandatorily Redeemable Shares, Par Value | (per share) | $ 308 | R$ 1000 | |
Short-term Debt [Member] | |||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Beginning Balance | $ 0 | [1] | |
Accretion expense | 2 | ||
Ending Balance | 2 | [1] | |
Long-term Debt [Member] | |||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |||
Beginning Balance | 104 | [1] | |
Reclass to short-term | (2) | ||
Accretion expense | 3 | ||
Payments | (5) | ||
Effect of foreign currency translation adjustments | (3) | ||
Ending Balance | $ 97 | [1] | |
[1] | Includes 315,000 mandatorily redeemable shares outstanding with a par value of 1,000 Brazilian reais (approximately $308) as of Feb. 28, 2018. |
FAIR VALUE MEASUREMENTS FAIR 63
FAIR VALUE MEASUREMENTS FAIR VALUE MEASUREMENTS - Narrative (Details) - USD ($) $ in Millions | 6 Months Ended | ||
Feb. 28, 2017 | Feb. 28, 2018 | Aug. 31, 2017 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Net book value | $ 6,109 | $ 5,930 | |
Seeds And Genomics [Member] | Impairment Of Asset [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Net book value | $ 18 | ||
Seeds And Genomics [Member] | Estimate of Fair Value Measurement [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Net book value | 7 | ||
Seeds And Genomics [Member] | Property, Plant and Equipment [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Asset impairment charges | 11 | ||
Seeds And Genomics [Member] | Cost of Goods Sold [Member] | Property, Plant and Equipment [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Asset impairment charges | 4 | ||
Seeds And Genomics [Member] | Restructuring Charges [Member] | Property, Plant and Equipment [Member] | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Asset impairment charges | $ 7 |
FINANCIAL INSTRUMENTS Narrative
FINANCIAL INSTRUMENTS Narrative (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Feb. 28, 2017 | Feb. 28, 2018 | Feb. 28, 2017 | Aug. 31, 2017 | |
Derivatives, Fair Value [Line Items] | ||||
Cash Flow Hedge Gain (Loss) to be Reclassified within Twelve Months | $ (15,000,000) | |||
Discontinuation of Cash Flow Hedge | $ 1,000,000 | $ 37,000,000 | ||
subject to master netting arrangement, or similar agreement [Member] | ||||
Derivatives, Fair Value [Line Items] | ||||
Derivative Liability Subject to Master Netting Arrangement, or Similar Agreement | $ 11,000,000 | $ 19,000,000 | ||
Foreign Exchange Contract [Member] | ||||
Derivatives, Fair Value [Line Items] | ||||
Maximum Length of Time Hedged in Cash Flow Hedge | 6 months | |||
Commodity Contracts | ||||
Derivatives, Fair Value [Line Items] | ||||
Maximum Length of Time Hedged in Cash Flow Hedge | 30 months |
FINANCIAL INSTRUMENTS FINANCIAL
FINANCIAL INSTRUMENTS FINANCIAL INSTRUMENTS Notional Amounts of Derivative Instruments Outstanding (Details) - USD ($) $ in Millions | Feb. 28, 2018 | Aug. 31, 2017 |
Designated as Hedging Instrument | ||
Derivatives, Notional [Line Items] | ||
Total Derivatives | $ 920 | $ 883 |
Not Designated as Hedging Instrument | ||
Derivatives, Notional [Line Items] | ||
Total Derivatives | 1,877 | 2,343 |
Foreign Exchange Contract [Member] | Designated as Hedging Instrument | ||
Derivatives, Notional [Line Items] | ||
Total Derivatives | 299 | 453 |
Foreign Exchange Contract [Member] | Not Designated as Hedging Instrument | ||
Derivatives, Notional [Line Items] | ||
Total Derivatives | 1,709 | 2,133 |
Commodity Contracts | Designated as Hedging Instrument | ||
Derivatives, Notional [Line Items] | ||
Total Derivatives | 621 | 430 |
Commodity Contracts | Not Designated as Hedging Instrument | ||
Derivatives, Notional [Line Items] | ||
Total Derivatives | 161 | 189 |
Interest Rate Contracts [Member] | Not Designated as Hedging Instrument | ||
Derivatives, Notional [Line Items] | ||
Total Derivatives | $ 7 | $ 21 |
FINANCIAL INSTRUMENTS FINANCI66
FINANCIAL INSTRUMENTS FINANCIAL INSTRUMENTS Fair Value of Derivatives Outstanding (Details) - USD ($) $ in Millions | Feb. 28, 2018 | Aug. 31, 2017 | ||
Derivatives, Fair Value [Line Items] | ||||
Derivative Asset, Fair Value, Gross Asset | $ 30 | $ 20 | ||
Derivative Asset, Collateral, Obligation to Return Cash, Offset | (9) | (8) | ||
Derivative Asset, Fair Value, Amount Offset Against Collateral | 21 | 12 | ||
Derivative Asset, Fair Value of Collateral | 0 | 5 | ||
Derivative Asset | 21 | 17 | ||
Other Assets, Current | 310 | 268 | ||
Other Assets, Noncurrent | 892 | 955 | ||
Derivative Liability, Fair Value, Gross Liability | 31 | 29 | ||
Derivative Liability, Collateral, Right to Reclaim Cash, Offset | (9) | (8) | ||
Derivative Liability, Fair Value, Amount Offset Against Collateral | 22 | 21 | ||
Derivative Liability, Fair Value of Collateral | 0 | 0 | ||
Derivative Liability | 22 | 21 | ||
Miscellaneous short-term accruals (variable interest entity restricted - 2018: $2 and 2017: $2) | 702 | 740 | ||
Other Liabilities, Noncurrent | 368 | 386 | ||
Other Assets | ||||
Derivatives, Fair Value [Line Items] | ||||
Derivative Asset, Fair Value, Gross Asset | 1 | 1 | ||
Derivative Asset, Collateral, Obligation to Return Cash, Offset | 0 | 0 | ||
Derivative Asset, Fair Value, Amount Offset Against Collateral | 1 | 1 | ||
Derivative Asset, Fair Value of Collateral | 0 | 0 | ||
Derivative Asset | 1 | 1 | ||
Non-derivative Balances | 891 | 954 | ||
Other current assets | ||||
Derivatives, Fair Value [Line Items] | ||||
Derivative Asset, Fair Value, Gross Asset | 29 | 18 | ||
Derivative Asset, Collateral, Obligation to Return Cash, Offset | (9) | (7) | ||
Derivative Asset, Fair Value, Amount Offset Against Collateral | 20 | 11 | ||
Derivative Asset, Fair Value of Collateral | 0 | 5 | ||
Derivative Asset | 20 | 16 | ||
Non-derivative Balances | 290 | 252 | ||
Derivative Liability, Fair Value, Gross Liability | 9 | 7 | ||
Derivative Liability, Collateral, Right to Reclaim Cash, Offset | (9) | (7) | ||
Derivative Liability, Fair Value, Amount Offset Against Collateral | 0 | 0 | ||
Derivative Liability, Fair Value of Collateral | 0 | 0 | ||
Derivative Liability | 0 | 0 | ||
Miscellaneous short term accruals | ||||
Derivatives, Fair Value [Line Items] | ||||
Derivative Asset, Fair Value, Gross Asset | 1 | |||
Derivative Asset, Collateral, Obligation to Return Cash, Offset | (1) | |||
Derivative Asset, Fair Value, Amount Offset Against Collateral | 0 | |||
Derivative Asset, Fair Value of Collateral | 0 | |||
Derivative Asset | 0 | |||
Non-derivative Balances | 680 | 719 | ||
Derivative Liability, Fair Value, Gross Liability | 22 | 22 | ||
Derivative Liability, Collateral, Right to Reclaim Cash, Offset | 0 | (1) | ||
Derivative Liability, Fair Value, Amount Offset Against Collateral | 22 | 21 | ||
Derivative Liability, Fair Value of Collateral | 0 | 0 | ||
Derivative Liability | 22 | 21 | ||
Foreign Exchange Contract [Member] | Other current assets | Not Designated as Hedging Instrument | ||||
Derivatives, Fair Value [Line Items] | ||||
Derivative Asset, Fair Value, Gross Asset | 3 | 10 | ||
Derivative Asset, Collateral, Obligation to Return Cash, Offset | 0 | 0 | ||
Derivative Asset, Fair Value, Amount Offset Against Collateral | 3 | 10 | ||
Derivative Asset, Fair Value of Collateral | 0 | 0 | ||
Derivative Asset | 3 | 10 | ||
Foreign Exchange Contract [Member] | Miscellaneous short term accruals | Designated as Hedging Instrument | ||||
Derivatives, Fair Value [Line Items] | ||||
Derivative Liability, Fair Value, Gross Liability | 6 | 14 | ||
Derivative Liability, Collateral, Right to Reclaim Cash, Offset | 0 | 0 | ||
Derivative Liability, Fair Value, Amount Offset Against Collateral | 6 | 14 | ||
Derivative Liability, Fair Value of Collateral | 0 | 0 | ||
Derivative Liability | 6 | 14 | ||
Foreign Exchange Contract [Member] | Miscellaneous short term accruals | Not Designated as Hedging Instrument | ||||
Derivatives, Fair Value [Line Items] | ||||
Derivative Liability, Fair Value, Gross Liability | 9 | 2 | ||
Derivative Liability, Collateral, Right to Reclaim Cash, Offset | 0 | 0 | ||
Derivative Liability, Fair Value, Amount Offset Against Collateral | 9 | 2 | ||
Derivative Liability, Fair Value of Collateral | 0 | 0 | ||
Derivative Liability | 9 | 2 | ||
Commodity Contract [Member] | Other Assets | Designated as Hedging Instrument | ||||
Derivatives, Fair Value [Line Items] | ||||
Derivative Asset, Fair Value, Gross Asset | 1 | 1 | ||
Derivative Asset, Collateral, Obligation to Return Cash, Offset | 0 | 0 | ||
Derivative Asset, Fair Value, Amount Offset Against Collateral | 1 | 1 | ||
Derivative Asset, Fair Value of Collateral | 0 | 0 | ||
Derivative Asset | 1 | 1 | ||
Commodity Contract [Member] | Other current assets | Designated as Hedging Instrument | ||||
Derivatives, Fair Value [Line Items] | ||||
Derivative Asset, Fair Value, Gross Asset | 18 | [1] | 2 | [2] |
Derivative Asset, Collateral, Obligation to Return Cash, Offset | (9) | [1] | (7) | [2] |
Derivative Asset, Fair Value, Amount Offset Against Collateral | 9 | [1] | (5) | [2] |
Derivative Asset, Fair Value of Collateral | 0 | [1] | 5 | [2] |
Derivative Asset | 9 | [1] | 0 | [2] |
Derivative Liability, Fair Value, Gross Liability | 9 | [1] | 7 | [2] |
Derivative Liability, Collateral, Right to Reclaim Cash, Offset | (9) | [1] | (7) | [2] |
Derivative Liability, Fair Value, Amount Offset Against Collateral | 0 | [1] | 0 | [2] |
Derivative Liability, Fair Value of Collateral | 0 | [1] | 0 | [2] |
Derivative Liability | 0 | [1] | 0 | [2] |
Commodity Contract [Member] | Other current assets | Not Designated as Hedging Instrument | ||||
Derivatives, Fair Value [Line Items] | ||||
Derivative Asset, Fair Value, Gross Asset | 8 | [1] | 6 | [2] |
Derivative Asset, Collateral, Obligation to Return Cash, Offset | 0 | [1] | 0 | [2] |
Derivative Asset, Fair Value, Amount Offset Against Collateral | 8 | [1] | 6 | [2] |
Derivative Asset, Fair Value of Collateral | 0 | [1] | 0 | [2] |
Derivative Asset | 8 | [1] | 6 | [2] |
Commodity Contract [Member] | Miscellaneous short term accruals | Designated as Hedging Instrument | ||||
Derivatives, Fair Value [Line Items] | ||||
Derivative Asset, Fair Value, Gross Asset | 1 | |||
Derivative Asset, Collateral, Obligation to Return Cash, Offset | (1) | |||
Derivative Asset, Fair Value, Amount Offset Against Collateral | 0 | |||
Derivative Asset, Fair Value of Collateral | 0 | |||
Derivative Asset | 0 | |||
Derivative Liability, Fair Value, Gross Liability | 1 | 3 | ||
Derivative Liability, Collateral, Right to Reclaim Cash, Offset | 0 | (1) | ||
Derivative Liability, Fair Value, Amount Offset Against Collateral | 1 | 2 | ||
Derivative Liability, Fair Value of Collateral | 0 | 0 | ||
Derivative Liability | 1 | 2 | ||
Commodity Contract [Member] | Miscellaneous short term accruals | Not Designated as Hedging Instrument | ||||
Derivatives, Fair Value [Line Items] | ||||
Derivative Liability, Fair Value, Gross Liability | 6 | [1] | 3 | |
Derivative Liability, Collateral, Right to Reclaim Cash, Offset | 0 | [1] | 0 | |
Derivative Liability, Fair Value, Amount Offset Against Collateral | 6 | [1] | 3 | |
Derivative Liability, Fair Value of Collateral | 0 | [1] | 0 | |
Derivative Liability | $ 6 | [1] | $ 3 | |
[1] | As allowed by the Derivatives and Hedging topic of the ASC, commodity derivative assets and liabilities have been offset by collateral subject to an enforceable master netting arrangement or similar arrangement. Therefore, these commodity contracts that are in an asset or liability position are included in asset accounts within the Statements of Consolidated Financial Position. | |||
[2] | As allowed by the Derivatives and Hedging topic of the ASC, commodity derivative assets and liabilities have been offset by collateral subject to an enforceable master netting arrangement or similar arrangement. Therefore, these commodity contracts that are in an asset or liability position are included in asset accounts within the Statements of Consolidated Financial Position. |
FINANCIAL INSTRUMENTS FINANCI67
FINANCIAL INSTRUMENTS FINANCIAL INSTRUMENTS Gain (Loss) from Derivatives (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Feb. 28, 2018 | Feb. 28, 2017 | Feb. 28, 2018 | Feb. 28, 2017 | ||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Amount of Gain (Loss) Recognized in AOCI (Effective Portion) | $ 10,000,000 | $ 13,000,000 | $ 21,000,000 | $ 59,000,000 | |
Amount of Gain (Loss) Recognized in Income | (14,000,000) | 18,000,000 | (5,000,000) | (77,000,000) | |
Gain (Loss) from Components Excluded from Assessment of Cash Flow Hedge Effectiveness, Net | 0 | 0 | 0 | 0 | |
Discontinuation of Cash Flow Hedge | 1,000,000 | 37,000,000 | |||
Foreign Currency Transaction Gain (Loss) Realized | 41,000,000 | (21,000,000) | 43,000,000 | (18,000,000) | |
Designated as Hedging Instrument | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Amount of Gain (Loss) Recognized in AOCI (Effective Portion) | 10,000,000 | 13,000,000 | 21,000,000 | 59,000,000 | |
Amount of Gain (Loss) Recognized in Income | (11,000,000) | (9,000,000) | (12,000,000) | (58,000,000) | |
Not Designated as Hedging Instrument | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Amount of Gain (Loss) Recognized in Income | (3,000,000) | 27,000,000 | 7,000,000 | (19,000,000) | |
Commodity Contracts | Cost of Sales [Member] | Not Designated as Hedging Instrument | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Amount of Gain (Loss) Recognized in Income | 1,000,000 | 0 | 1,000,000 | (1,000,000) | |
Commodity Contracts | Net Sales [Member] | Not Designated as Hedging Instrument | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Amount of Gain (Loss) Recognized in Income | (1,000,000) | 1,000,000 | (2,000,000) | 1,000,000 | |
Foreign Exchange Contract [Member] | Other expense, net [Member] | Not Designated as Hedging Instrument | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Amount of Gain (Loss) Recognized in Income | [1] | (3,000,000) | 26,000,000 | 8,000,000 | (19,000,000) |
Fair Value Hedges | Commodity Contracts | Cost of Sales [Member] | Designated as Hedging Instrument | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Amount of Gain (Loss) Recognized in Income | [2] | (9,000,000) | 3,000,000 | (8,000,000) | (10,000,000) |
Cash Flow Hedging [Member] | Commodity Contracts | Cost of Sales [Member] | Designated as Hedging Instrument | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Amount of Gain (Loss) Recognized in AOCI (Effective Portion) | [3] | 12,000,000 | 10,000,000 | 14,000,000 | 29,000,000 |
Amount of Gain (Loss) Recognized in Income | [2],[4] | 1,000,000 | (12,000,000) | 0 | (15,000,000) |
Cash Flow Hedging [Member] | Foreign Exchange Contract [Member] | Cost of Sales [Member] | Designated as Hedging Instrument | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Amount of Gain (Loss) Recognized in AOCI (Effective Portion) | [3] | 0 | 1,000,000 | 0 | 7,000,000 |
Amount of Gain (Loss) Recognized in Income | [2],[4] | 0 | 1,000,000 | 0 | 2,000,000 |
Cash Flow Hedging [Member] | Foreign Exchange Contract [Member] | Net Sales [Member] | Designated as Hedging Instrument | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Amount of Gain (Loss) Recognized in AOCI (Effective Portion) | [3] | (2,000,000) | 3,000,000 | 7,000,000 | 20,000,000 |
Amount of Gain (Loss) Recognized in Income | [2],[4] | 1,000,000 | 3,000,000 | 3,000,000 | 10,000,000 |
Cash Flow Hedging [Member] | Interest Rate Contracts [Member] | Interest Expense [Member] | Designated as Hedging Instrument | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Amount of Gain (Loss) Recognized in AOCI (Effective Portion) | [3] | 0 | (1,000,000) | 0 | 3,000,000 |
Amount of Gain (Loss) Recognized in Income | [2],[4] | $ (4,000,000) | $ (4,000,000) | (7,000,000) | (8,000,000) |
Cash Flow Hedging [Member] | Interest Rate Contracts [Member] | Other expense, net [Member] | Designated as Hedging Instrument | |||||
Derivative Instruments, Gain (Loss) [Line Items] | |||||
Amount of Gain (Loss) Recognized in AOCI (Effective Portion) | [3] | 0 | 0 | ||
Amount of Gain (Loss) Recognized in Income | [2],[4] | $ 0 | $ (37,000,000) | ||
[1] | Gain or loss on foreign currency contracts not designated as hedges was offset by a foreign currency transaction loss of $41 million and $21 million during the three months ended Feb. 28, 2018, and Feb. 28, 2017, respectively. | ||||
[2] | The gain or loss on derivatives designated as hedges from ineffectiveness is not significant during the three months ended Feb. 28, 2018, and Feb. 28, 2017. No gains or losses were excluded from the assessment of hedge effectiveness during the three months ended Feb. 28, 2018, and Feb. 28, 2017. | ||||
[3] | Accumulated other comprehensive loss (AOCL) | ||||
[4] | For derivatives designated as cash flow hedges under the Derivatives and Hedging topic of the ASC, this represents the effective portion of the gain (loss) reclassified from AOCL into income during the period. |
POSTRETIREMENT BENEFITS - PEN68
POSTRETIREMENT BENEFITS - PENSIONS, HEALTH CARE AND OTHER (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Feb. 28, 2018 | Feb. 28, 2017 | Feb. 28, 2018 | Feb. 28, 2017 | |
Pension Benefits | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service Cost for Benefits Earned During the Period | $ 17 | $ 18 | $ 34 | $ 36 |
Interest Cost on Benefit Obligation | 23 | 21 | 47 | 44 |
Assumed Return on Plan Assets | (45) | (45) | (91) | (89) |
Amortization of Unrecognized Net (Gain)/Loss | 11 | 13 | 22 | 26 |
Restructuring Charges | 0 | 2 | 0 | 2 |
Total Net Periodic Benefit Cost | 6 | 9 | 12 | 19 |
Pension Benefits | U.S. | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service Cost for Benefits Earned During the Period | 14 | 15 | 28 | 30 |
Interest Cost on Benefit Obligation | 22 | 20 | 44 | 41 |
Assumed Return on Plan Assets | (43) | (43) | (86) | (85) |
Amortization of Unrecognized Net (Gain)/Loss | 10 | 12 | 20 | 24 |
Restructuring Charges | 0 | 0 | 0 | 0 |
Total Net Periodic Benefit Cost | 3 | 4 | 6 | 10 |
Pension Benefits | Outside the U.S. | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service Cost for Benefits Earned During the Period | 3 | 3 | 6 | 6 |
Interest Cost on Benefit Obligation | 1 | 1 | 3 | 3 |
Assumed Return on Plan Assets | (2) | (2) | (5) | (4) |
Amortization of Unrecognized Net (Gain)/Loss | 1 | 1 | 2 | 2 |
Restructuring Charges | 0 | 2 | 0 | 2 |
Total Net Periodic Benefit Cost | 3 | 5 | 6 | 9 |
Health Care and Other Postretirement Benefits | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service Cost for Benefits Earned During the Period | 2 | 2 | 4 | 3 |
Interest Cost on Benefit Obligation | 1 | 1 | 2 | 2 |
Amortization of Unrecognized Net (Gain)/Loss | (1) | 2 | (2) | 3 |
Restructuring Charges | 0 | 2 | 0 | 2 |
Total Net Periodic Benefit Cost | $ 2 | $ 7 | $ 4 | $ 10 |
STOCK BASED COMPENSATION PLAN69
STOCK BASED COMPENSATION PLANS Schedule of Stock-based Compensation Expense (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Feb. 28, 2018 | Feb. 28, 2017 | Feb. 28, 2018 | Feb. 28, 2017 | |
Cost of Goods Sold [Member] | ||||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Allocated Stock Based Compensation Expense | $ 4 | $ 4 | $ 8 | $ 7 |
Selling, General and Administrative Expenses [Member] | ||||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Allocated Stock Based Compensation Expense | 18 | 19 | 43 | 45 |
Research and Development Expenses [Member] | ||||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Allocated Stock Based Compensation Expense | 6 | 7 | 12 | 13 |
Restructuring Charges [Member] | ||||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Allocated Stock Based Compensation Expense | 0 | 0 | 0 | 1 |
Pre-Tax Stock-Based Compensation Expense [Member] | ||||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Allocated Stock Based Compensation Expense | 28 | 30 | 63 | 66 |
Income Tax Benefit [Member] | ||||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Allocated Stock Based Compensation Expense | (2) | (10) | (18) | (23) |
Net Stock Based Compensation [Member] | ||||
Employee Service Share Based Compensation Allocation Of Recognized Period Costs [Line Items] | ||||
Allocated Stock Based Compensation Expense | $ 26 | $ 20 | $ 45 | $ 43 |
ACCUMULATED OTHER COMPREHENSI70
ACCUMULATED OTHER COMPREHENSIVE LOSS (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||
Feb. 28, 2018 | Feb. 28, 2017 | Feb. 28, 2018 | Feb. 28, 2017 | Aug. 31, 2017 | ||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||||||
Beginning balance | $ (2,427) | $ (2,808) | $ (2,808) | |||
Other comprehensive income (loss) before reclassifications | (35) | 307 | ||||
Amounts reclassified from accumulated other comprehensive loss (income) | $ 9 | $ 22 | 17 | 53 | 74 | |
Total Other Comprehensive Income (Loss), Net of Tax | 50 | 199 | (18) | (9) | 381 | |
Ending balance | (2,445) | (2,445) | (2,427) | |||
Realized net derivative (gains) losses, tax (expense) benefit | (1) | (4) | (1) | (19) | ||
Amounts reclassified from accumulated other comprehensive loss (income) | 9 | 22 | 17 | 53 | 74 | |
Available-for-sale Securities [Member] | ||||||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||||||
Beginning balance | 1 | 1 | 1 | |||
Other comprehensive income (loss) before reclassifications | (1) | (2) | ||||
Amounts reclassified from accumulated other comprehensive loss (income) | 1 | (1) | (1) | (1) | 2 | |
Total Other Comprehensive Income (Loss), Net of Tax | (2) | 0 | ||||
Ending balance | (1) | (1) | 1 | |||
Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax | 1 | (2) | 1 | (2) | ||
Realized net derivative (gains) losses, tax (expense) benefit | 0 | 1 | 0 | 1 | ||
Amounts reclassified from accumulated other comprehensive loss (income) | 1 | (1) | (1) | (1) | 2 | |
Pension Benefits | ||||||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||||||
Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax | 10 | 19 | 20 | 35 | ||
Other Comprehensive (Income) Loss, Pension and Other Postretirement Benefit Plans, Tax | (1) | (6) | (5) | (12) | ||
Accumulated Translation Adjustment [Member] | ||||||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||||||
Beginning balance | (2,059) | (2,292) | (2,292) | |||
Other comprehensive income (loss) before reclassifications | 25 | 233 | ||||
Amounts reclassified from accumulated other comprehensive loss (income) | 0 | 0 | ||||
Total Other Comprehensive Income (Loss), Net of Tax | 25 | 233 | ||||
Ending balance | (2,034) | (2,034) | (2,059) | |||
Amounts reclassified from accumulated other comprehensive loss (income) | 0 | 0 | ||||
Accumulated Net Gain (Loss) from Designated or Qualifying Cash Flow Hedges [Member] | ||||||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||||||
Beginning balance | (122) | (177) | (177) | |||
Other comprehensive income (loss) before reclassifications | (11) | 21 | ||||
Amounts reclassified from accumulated other comprehensive loss (income) | 1 | 8 | 3 | 29 | 34 | |
Total Other Comprehensive Income (Loss), Net of Tax | (8) | 55 | ||||
Ending balance | (130) | (130) | (122) | |||
Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax | 2 | 12 | 4 | 48 | ||
Realized net derivative (gains) losses, tax (expense) benefit | (1) | (4) | (1) | (19) | ||
Amounts reclassified from accumulated other comprehensive loss (income) | 1 | 8 | 3 | 29 | 34 | |
Accumulated Defined Benefit Plans Adjustment Attributable to Parent [Member] | ||||||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||||||
Beginning balance | (247) | (340) | (340) | |||
Other comprehensive income (loss) before reclassifications | (48) | 55 | ||||
Amounts reclassified from accumulated other comprehensive loss (income) | 9 | 13 | 15 | 23 | 38 | |
Total Other Comprehensive Income (Loss), Net of Tax | (33) | 93 | ||||
Ending balance | (280) | (280) | (247) | |||
Amounts reclassified from accumulated other comprehensive loss (income) | 9 | 13 | 15 | 23 | $ 38 | |
Cost of Sales [Member] | Pension Benefits | ||||||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||||||
Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax | (2) | (3) | (7) | (10) | ||
Other Expense [Member] | Available-for-sale Securities [Member] | ||||||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||||||
Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax | 1 | (2) | 1 | (2) | ||
Selling, General and Administrative Expenses [Member] | Pension Benefits | ||||||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||||||
Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax | 7 | 10 | 13 | 20 | ||
Restructuring Charges [Member] | Pension Benefits | ||||||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||||||
Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax | 0 | 4 | 0 | 4 | ||
Inventory [Member] | Pension Benefits | ||||||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||||||
Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax | [1] | 3 | 5 | 7 | 11 | |
Foreign Exchange Contract [Member] | Net Sales [Member] | Accumulated Net Gain (Loss) from Designated or Qualifying Cash Flow Hedges [Member] | ||||||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||||||
Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax | (1) | (3) | (3) | (10) | ||
Foreign Exchange Contract [Member] | Cost of Sales [Member] | Accumulated Net Gain (Loss) from Designated or Qualifying Cash Flow Hedges [Member] | ||||||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||||||
Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax | 0 | (1) | 0 | (2) | ||
Commodity Contract [Member] | Cost of Sales [Member] | Accumulated Net Gain (Loss) from Designated or Qualifying Cash Flow Hedges [Member] | ||||||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||||||
Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax | (1) | 12 | 0 | 15 | ||
Interest Rate Contracts [Member] | Other Expense [Member] | Accumulated Net Gain (Loss) from Designated or Qualifying Cash Flow Hedges [Member] | ||||||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||||||
Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax | 0 | 0 | 0 | 37 | ||
Interest Rate Contracts [Member] | Interest Expense [Member] | Accumulated Net Gain (Loss) from Designated or Qualifying Cash Flow Hedges [Member] | ||||||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||||||
Reclassification from Accumulated Other Comprehensive Income, Current Period, before Tax | $ 4 | $ 4 | $ 7 | $ 8 | ||
[1] | The amortization of unrecognized net loss is recorded to net periodic benefit cost, which is allocated to selling, general and administrative expenses and to inventory, which is recognized through cost of goods sold. The company recorded $3 million and $5 million of net periodic benefit cost to inventory, of which approximately $2 million and $3 million was recognized in cost of goods sold during the three months ended Feb. 28, 2018, and Feb. 28, 2017, respectively. The company recorded $7 million and $11 million of net periodic benefit cost to inventory, of which approximately $7 million and $10 million was recognized in cost of goods sold during the six months ended Feb. 28, 2018, and Feb. 28, 2017, respectively. See Note 14 — Postretirement Benefits - Pensions, Health Care and Other — for additional information. |
EARNINGS PER SHARE (Details)
EARNINGS PER SHARE (Details) - shares shares in Millions | 3 Months Ended | 6 Months Ended | ||
Feb. 28, 2018 | Feb. 28, 2017 | Feb. 28, 2018 | Feb. 28, 2017 | |
Earnings Per Share [Abstract] | ||||
Weighted-Average Number of Common Shares | 441 | 438.7 | 440.6 | 438.4 |
Dilutive Potential Common Shares | 4.5 | 3.6 | 5.3 | 3.9 |
Antidilutive Potential Common Shares | 0.1 | 2.2 | 0.1 | 4 |
SUPPLEMENTAL CASH FLOW INFORM72
SUPPLEMENTAL CASH FLOW INFORMATION (Details) - USD ($) $ in Millions | 6 Months Ended | |
Feb. 28, 2018 | Feb. 28, 2017 | |
Supplemental Cash Flow Information [Abstract] | ||
Interest | $ 235 | $ 225 |
Taxes | 229 | 187 |
Capital expenditures incurred but not yet paid | 103 | 117 |
Dividend payable | 239 | $ 237 |
Noncash transactions related to capital leases | $ 46 |
COMMITMENTS AND CONTINGENCIES E
COMMITMENTS AND CONTINGENCIES ENVIRONMENTAL AND LITIGATION (Details) $ in Millions | 1 Months Ended | 6 Months Ended | 12 Months Ended | 14 Months Ended | |
Sep. 30, 2016USD ($) | Feb. 28, 2018USD ($)plaintiff | Aug. 31, 2017USD ($)personclaim | Dec. 31, 2017USD ($) | Aug. 31, 2016USD ($) | |
Accrual For Environmental And Litigation Loss Contingencies [Abstract] | |||||
Accrual For Environmental And Litigation Loss Contingencies | $ 254 | $ 277 | |||
Pending Litigation [Member] | Personal Injury Lawsuits [Member] | State Courts in St Louis, Missouri and Los Angeles, California [Member] | |||||
Accrual For Environmental And Litigation Loss Contingencies [Abstract] | |||||
Loss Contingency, Pending Claims, Number | claim | 30 | ||||
Loss Contingency, Number of Plaintiffs | person | 750 | ||||
Pending Litigation [Member] | Personal Injury Lawsuits [Member] | Various State And Federal Courts [Member] | |||||
Accrual For Environmental And Litigation Loss Contingencies [Abstract] | |||||
Loss Contingency, Number of Plaintiffs | plaintiff | 5,200 | ||||
Settled Litigation [Member] | Personal Injury Lawsuits [Member] | Other Current Liabilities [Member] | State Courts in St Louis, Missouri and Los Angeles, California [Member] | |||||
Accrual For Environmental And Litigation Loss Contingencies [Abstract] | |||||
Accrual | $ 280 | ||||
Loss Contingency, Loss in Period | $ 280 | ||||
Subsequent Event [Member] | Settled Litigation [Member] | Personal Injury Lawsuits [Member] | Maximum [Member] | State Courts in St Louis, Missouri and Los Angeles, California [Member] | |||||
Accrual For Environmental And Litigation Loss Contingencies [Abstract] | |||||
Settlement received (paid) | $ 280 |
COMMITMENTS AND CONTINGENCIES O
COMMITMENTS AND CONTINGENCIES OFF-BALANCE SHEET ARRANGEMENTS (Details) $ in Millions | Dec. 31, 2013USD ($) |
Bond [Member] | |
Off Balance Sheet Arrangement [Line Items] | |
Fair Value Disclosure, Off-balance Sheet Risks, Face Amount, Asset | $ 470 |
SEGMENT AND GEOGRAPHIC DATA (De
SEGMENT AND GEOGRAPHIC DATA (Details) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Feb. 28, 2018USD ($) | Feb. 28, 2017USD ($) | Feb. 28, 2018USD ($)segment | Feb. 28, 2017USD ($) | ||
Segment Reporting Information [Line Items] | |||||
Number of Reportable Segments | segment | 2 | ||||
Income from operations of discontinued business | $ 2 | $ 5 | $ 4 | $ 21 | |
Net Sales | [1] | 5,019 | 5,074 | 7,677 | 7,724 |
Gross Profit | 2,966 | 2,952 | 4,278 | 4,211 | |
EBIT | [2],[3],[4] | 1,922 | 1,958 | 2,262 | 2,170 |
Depreciation and Amortization Expense | 193 | 183 | 381 | 372 | |
Reconciliation of EBIT to Net Income [Abstract] | |||||
EBIT | [2],[3],[4] | 1,922 | 1,958 | 2,262 | 2,170 |
Interest Expense — Net | 81 | 84 | 190 | 202 | |
Income Tax Provision | [5] | 382 | 506 | 444 | 571 |
Net Income Attributable to Monsanto Company | 1,459 | 1,368 | 1,628 | 1,397 | |
Corn seed and traits [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Net Sales | [1] | 2,721 | 2,902 | 3,508 | 3,851 |
Gross Profit | 1,790 | 1,932 | 2,205 | 2,467 | |
Soybean seed and traits [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Net Sales | [1] | 912 | 862 | 1,640 | 1,462 |
Gross Profit | 672 | 628 | 1,260 | 1,079 | |
Cotton seed and traits [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Net Sales | [1] | 123 | 108 | 243 | 224 |
Gross Profit | 101 | 77 | 174 | 150 | |
Vegetable seeds [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Net Sales | [1] | 198 | 193 | 312 | 324 |
Gross Profit | 93 | 99 | 151 | 168 | |
All other crops seeds and traits [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Net Sales | [1] | 134 | 121 | 155 | 173 |
Gross Profit | 81 | 41 | 79 | 53 | |
Total Seeds and Genomics [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Income attributable to non-controlling interest, before tax | 2 | 2 | 6 | ||
Net Sales | [1] | 4,088 | 4,186 | 5,858 | 6,034 |
Gross Profit | 2,737 | 2,777 | 3,869 | 3,917 | |
EBIT | [3],[4] | 1,779 | 1,839 | 2,081 | 2,038 |
Depreciation and Amortization Expense | 152 | 142 | 301 | 285 | |
Reconciliation of EBIT to Net Income [Abstract] | |||||
EBIT | [3],[4] | 1,779 | 1,839 | 2,081 | 2,038 |
Agricultural Productivity [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Net Sales | [1] | 931 | 888 | 1,819 | 1,690 |
Gross Profit | 229 | 175 | 409 | 294 | |
Total Agricultural Productivity [Member] | |||||
Segment Reporting Information [Line Items] | |||||
Income from operations of discontinued business | 2 | 5 | 4 | 21 | |
Income attributable to non-controlling interest, before tax | 1 | 1 | 1 | 1 | |
Net Sales | [1] | 931 | 888 | 1,819 | 1,690 |
Gross Profit | 229 | 175 | 409 | 294 | |
EBIT | [3],[4] | 143 | 119 | 181 | 132 |
Depreciation and Amortization Expense | 41 | 41 | 80 | 87 | |
Reconciliation of EBIT to Net Income [Abstract] | |||||
EBIT | [3],[4] | $ 143 | $ 119 | $ 181 | $ 132 |
[1] | (1)Represents net sales from continuing operations. | ||||
[2] | (1)Includes the income from operations of discontinued businesses and the income (loss) from operations of noncontrolling interests. | ||||
[3] | (2)EBIT is defined as earnings (loss) before interest and taxes; see the following table for reconciliation. Earnings (loss) is intended to mean net income (loss) attributable to Monsanto Company as presented in the Statements of Consolidated Operations under U.S. GAAP. EBIT is an operating performance measure for the two reportable segments. | ||||
[4] | (3)Agricultural Productivity EBIT includes income from operations of discontinued businesses of $2 million and $5 million for the three months ended Feb. 28, 2018, and Feb. 28, 2017, respectively. Agricultural Productivity EBIT includes income from operations of discontinued businesses of $4 million and $21 million for the six months ended Feb. 28, 2018, and Feb. 28, 2017, respectively. | ||||
[5] | (2)Includes the income tax provision on discontinued operations and the income tax provision (benefit) of noncontrolling interests. |