Golden Growers Cooperative (GGROU) 10-Q 13 Nov 17 2017 Q3 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	9 Months Ended
	Sep. 30, 2017	Nov. 10, 2017
Document and Entity Information
Entity Registrant Name	Golden Growers Cooperative
Entity Central Index Key	1,489,874
Document Type	10-Q
Document Period End Date	Sep. 30, 2017
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Current Reporting Status	Yes
Entity Filer Category	Non-accelerated Filer
Entity Common Stock, Shares Outstanding		15,490,480
Document Fiscal Year Focus	2,017
Document Fiscal Period Focus	Q3

CONDENSED BALANCE SHEETS

CONDENSED BALANCE SHEETS - USD ($) $ in Thousands	Sep. 30, 2017	Dec. 31, 2016
Current Assets:
Cash and Cash Equivalents	$ 5,855	$ 2,792
Short-Term Investments	220	219
Prepaid Expenses		342
Total Current Assets	6,075	3,353
Furniture and Equipment, Net		1
Investment in ProGold Limited Liability Company	19,978	20,484
Total Assets	26,053	23,838
Current Liabilities:
Accounts Payable		1
Accrued Liabilities	2,169	221
Total Current Liabilities	2,169	222
Members' Equity
Membership Units, Authorized 60,000,000 Units, Issued and Outstanding 15,490,480 as of September 30, 2017 and December 31, 2016	23,884	23,616
Total Members' Equity	23,884	23,616
Total Liabilities and Members' Equity	$ 26,053	$ 23,838

CONDENSED BALANCE SHEETS (Paren

CONDENSED BALANCE SHEETS (Parenthetical) - shares	Sep. 30, 2017	Dec. 31, 2016
BALANCE SHEETS
Membership Units, Authorized	60,000,000	60,000,000
Membership Units, Issued	15,490,480	15,490,480
Membership Units, Outstanding	15,490,480	15,490,480

CONDENSED STATEMENTS OF OPERATI

CONDENSED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2017	Sep. 30, 2016	Sep. 30, 2017	Sep. 30, 2016
OPERATIONS
Corn Revenue	$ 10,286	$ 12,664	$ 39,026	$ 43,466
Corn Expense	(10,309)	(12,699)	(39,093)	(43,545)
Net Income from ProGold Limited Liability Company	2,440	1,309	7,333	4,068
General & Administrative Expenses	(125)	(104)	(463)	(447)
Net Income from Operations	2,292	1,170	6,803	3,542
Interest Income	12	2	18	6
Net Income Before Income Tax	2,304	1,172	6,821	3,548
Net Income	$ 2,304	$ 1,172	$ 6,821	$ 3,548
Weighted Average Shares/Units Outstanding	15,490,480	15,490,480	15,490,480	15,490,480
Earnings per Share/Membership Unit (In dollars per share)	$ 0.15	$ 0.08	$ 0.44	$ 0.23

CONDENSED STATEMENTS OF COMPREH

CONDENSED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2017	Sep. 30, 2016	Sep. 30, 2017	Sep. 30, 2016
COMPREHENSIVE INCOME
Net income	$ 2,304	$ 1,172	$ 6,821	$ 3,548
Pension Liability Adjustment				48
Comprehensive Income	$ 2,304	$ 1,172	$ 6,821	$ 3,596

CONDENSED STATEMENTS OF CASH FL

CONDENSED STATEMENTS OF CASH FLOWS - USD ($)	9 Months Ended
	Sep. 30, 2017	Sep. 30, 2016
Cash Flows from Operating Activities
Net income	$ 6,821,000	$ 3,548,000
Net (Income) from ProGold Limited Liability Company	(7,333,000)	(4,068,000)
Depreciation	1,000	2,000
Changes in assets and liabilities
Prepaids Expenses	342,000	(303,000)
Accrued liabilities and payables	(222,000)	(248,000)
Net cash used in operating activities	(391,000)	(1,069,000)
Cash Flows from Investing Activities
Distribution Received from ProGold LLC	7,838,000	8,077,000
Net cash Provided in Investing Activities	7,838,000	8,077,000
Cash Flows from Financing Activities
Member Distributions Paid	(4,384,000)	(6,196,000)
Net Cash Used by Financing Activities	(4,384,000)	(6,196,000)
Increase (Decrease) in Cash and Cash Equivalents	3,063,000	812,000
Cash and Cash Equivalents, Beginning of Period	2,792,000	2,272,000
Cash and Cash Equivalents, End of Period	5,855,000	3,084,000
Non-Cash Financing Activity
Accrued Dividend Payable to Members	$ 2,169,000	$ 3,253,000

BASIS OF PRESENTATION

BASIS OF PRESENTATION	9 Months Ended
	Sep. 30, 2017
BASIS OF PRESENTATION
BASIS OF PRESENTATION	NOTE 1 – BASIS OF PRESENTATION The condensed financial statements of Golden Growers Cooperative (the “Cooperative”) for the nine-month periods ended September 30, 2017 and 2016 are unaudited and reflect all adjustments consisting of normal recurring adjustments which are, in the opinion of management, necessary for a fair presentation of the financial position and operating results for the interim period. The condensed financial statements should be read in conjunction with the financial statements and notes thereto, contained in the Cooperative’s Annual Report on Form 10-K for the fiscal year ended December 31, 2016. The results of operations for the nine-month period ended September 30, 2017 are not necessarily indicative of the results for the entire fiscal year ending December 31, 2017.

EXPENSES

EXPENSES	9 Months Ended
	Sep. 30, 2017
EXPENSES
EXPENSES	NOTE 2 – EXPENSES The Cooperative contracts with Cargill, Incorporated (“Cargill”) in connection with the procurement of corn and other agency services for an annual fee of $92,000, which is paid by the Cooperative to Cargill in quarterly installments and terminates on December 31, 2017.

PROGOLD LIMITED LIABILITY COMPA

PROGOLD LIMITED LIABILITY COMPANY	9 Months Ended
	Sep. 30, 2017
PROGOLD LIMITED LIABILITY COMPANY
PROGOLD LIMITED LIABILITY COMPANY	NOTE 3 – PROGOLD LIMITED LIABILITY COMPANY The Cooperative has a 49% ownership interest in ProGold Limited Liability Company (“ProGold LLC”). Following is summary financial information for ProGold LLC, which were derived from the monthly unaudited financial statements of ProGold LLC: September 30, December 31, (In Thousands) 2017 2016 2016 Current Assets $ 533 $ 137 $ 125 Long-Term Assets 40,352 44,906 42,086 Total Assets $ 40,885 $ 45,043 $ 42,211 Current Liabilities $ 113 $ 412 $ 407 Long-Term Liabilities — 100 0 Total Liabilities 113 512 407 Members’ Equity 40,772 44,531 41,804 Total Liabilities and Members’ Equity $ 40,885 $ 45,043 $ 42,211 Rent Revenue on Operating Lease $ 17,200 $ 17,226 $ 22,837 Expenses 2,236 8,922 11,866 Net Income $ 14,964 $ 8,304 $ 10,971

INVESTMENTS

INVESTMENTS	9 Months Ended
	Sep. 30, 2017
INVESTMENTS
INVESTMENTS	NOTE 4 – INVESTMENTS Fair value is defined as the price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Quoted market prices are generally not available for the Cooperative’s financial instruments. Fair values are based on judgments regarding anticipated cash flows, future expected loss experience, current economic conditions, risk characteristics of various financial instruments and other factors. These estimates involve uncertainties and matters of judgment, and therefore, cannot be determined with precision. Changes in assumptions could significantly affect the estimates. The Cooperative has determined fair value of its investments held to maturity based on Level 1 inputs. The Cooperative’s investments held to maturity are as follows as of September 30, 2017 and December 31, 2016 (in thousands): Gross Gross Amortized Unrealized Unrealized Cost Gains Losses Fair Value September 30, 2017: Money Market & CD’s $ 220 $ — $ — $ 220 December 31, 2016: Money Market & CD’s $ 219 $ — $ — $ 219

EMPLOYEE BENEFIT PLANS

EMPLOYEE BENEFIT PLANS	9 Months Ended
	Sep. 30, 2017
EMPLOYEE BENEFIT PLANS
EMPLOYEE BENEFIT PLANS	NOTE 5 – EMPLOYEE BENEFIT PLANS Pension Plan – In December 2012, the Cooperative approved a change to freeze the Cooperative’s defined benefit plan. As a result, no additional benefits will accrue to participants in the plan and no new employees are eligible for the plan. The following schedules provide the components of Net Periodic Benefit Cost for the nine months ended September 30, 2017 and September 30, 2016 (in thousands) : September 30, September 30, 2017 2016 Service Cost $ — $ — Interest Cost 26 28 Expected Return on Plan Assets (36) (33) Amortization of Net (Gain) Loss 1 8 Net Periodic Pension Cost $ (9) $ 3 Through the nine months ended September 30, 2017, the Cooperative has made $3,000 in contributions as compared to $12,000 through the nine months ended September 30, 2016. The Cooperative anticipates making a total of $6,000 in contributions in 2017. Contributions in 2016 totaled $12,000.

RECENTLY ISSUED ACCOUNTING PRON

RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS	9 Months Ended
	Sep. 30, 2017
RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS
RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS	NOTE 6 – RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS In May 2014, the FASB issued ASU 2014-09, Revenues from Contracts with Customers. The new revenue guidance broadly replaces the revenue guidance provided throughout the Codification. The core principle of the revenue guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. To achieve that core principle, an entity should apply the following steps: (1) identify the contract(s) with a customer, (2) identify the performance obligations in the contract, (3) determine the transaction price, (4) allocate the transaction price to the performance obligations in the contract, and (5) recognize revenue when (or as) the entity satisfies a performance obligation. The new revenue guidance also requires the capitalization of certain contract acquisition costs. Reporting entities must prepare new disclosures providing qualitative and quantitative information on the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. New disclosures also include qualitative and quantitative information on significant judgments, changes in judgments, and contract acquisition assets. At issuance, ASU 2014-09 was effective starting in 2017 for calendar-year public entities, and interim periods within that year. In August 2015, the FASB issued ASU 2015-14, Revenue from Contracts with Customers: Deferral of the Effective Date, which defers the adoption of ASU 2014-09 to annual reporting periods beginning after December 15, 2017, including interim reporting periods within that reporting period. Earlier application is permitted only as of annual reporting periods beginning after December 15, 2016, including interim reporting periods within that reporting period. During the fourth quarter of 2016, the Cooperative completed the initial evaluation of the new standard and the related assessment and review of existing revenue contracts with its customers. The Cooperative determined, on a preliminary basis, that the timing, pattern and amount of revenue recognized during the year should remain substantially the same. The Cooperative anticipates utilizing the full retrospective transition method. The primary impact of the adoption on the Cooperative’s financial statements will be the additional required disclosures around revenue recognition in the notes to the financial statements.

CHANGE IN ACCOUNTING STANDARDS

CHANGE IN ACCOUNTING STANDARDS	9 Months Ended
	Sep. 30, 2017
CHANGE IN ACCOUNTING STANDARDS
CHANGE IN ACCOUNTING STANDARDS	NOTE 7 – CHANGE IN ACCOUNTING STANDARDS The Cooperative has not been impacted by any changes in Accounting Standards since the filing of its most recent 10-K.

DISTRIBUTIONS TO MEMBERS

DISTRIBUTIONS TO MEMBERS	9 Months Ended
	Sep. 30, 2017
DISTRIBUTIONS TO MEMBERS
DISTRIBUTIONS TO MEMBERS	NOTE 8 – DISTRIBUTIONS TO MEMBERS On February 16, 2017, the Cooperative made distributions to its members totaling $2,215,139 or $0.143 per outstanding membership unit. On June 23, 2017, the Cooperative made distributions to its members totaling $2,168,667 or $0.14 per outstanding membership unit. At its September meeting, the Cooperative’s board authorized a distribution to its members totaling $2,168,667 or $0.14 per outstanding membership unit to be paid in October 2017. On October 9, 2017, the Cooperative made the distribution to its members. Traditionally, the Cooperative has issued distributions near $0.20/bushel. The reduced distribution in February was due to ProGold LLC’s suspension of automatic distributions to its members until such time as a final decision had been made for the use of ProGold LLC’s corn wet-milling facility starting on January 1, 2018. Therefore, the Cooperative issued a distribution to its members equal to 30% of allocated income, the minimum amount required to be distributed according to the Cooperative’s Bylaws. On April 4, 2017, ProGold and Cargill entered into a Second Amended and Restated Facility Lease commencing on January 1, 2018 and continuing through December 31, 2022. Subsequent to the lease, the ProGold LLC Board of Governors voted in May of 2017 to resume monthly distributions to its members. In determining the amount of the June and October distributions, the Cooperative evaluated revenue and cash flows for the current year and through the end of the new lease, including the potential for reduced distributions from ProGold LLC due to payments ProGold must make for infrastructure maintenance and certain capital improvements under the lease. The Cooperative also considered its potential purchase and payment obligations under the Consent Agreement, dated as of April 4, 2017 to be effective on January 1, 2018, by and among the Cooperative, Cargill, and American Crystal Sugar Company.

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES	9 Months Ended
	Sep. 30, 2017
COMMITMENTS AND CONTINGENCIES.
COMMITMENTS AND CONTINGENCIES	NOTE 9 – COMMITMENTS AND CONTINGENCIES The Cooperative contracted with Cargill in connection with the procurement of corn which includes an annual fee of $92,000 paid by the Cooperative to Cargill in quarterly installments and terminates December 31, 2017.

SUBSEQUENT EVENTS

SUBSEQUENT EVENTS	9 Months Ended
	Sep. 30, 2017
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS	NOTE 10 – SUBSEQUENT EVENTS The Cooperative has evaluated events through the date the financial statements were issued for potential recognition or disclosure in the September 30, 2017 financial statements and concluded that no subsequent events have occurred that would require recognition in the September 30, 2017 financial statements.

PROGOLD LIMITED LIABILITY COM17

PROGOLD LIMITED LIABILITY COMPANY (Tables)	9 Months Ended
	Sep. 30, 2017
PROGOLD LIMITED LIABILITY COMPANY
Schedule of financial information for ProGold LLC	September 30, December 31, (In Thousands) 2017 2016 2016 Current Assets $ 533 $ 137 $ 125 Long-Term Assets 40,352 44,906 42,086 Total Assets $ 40,885 $ 45,043 $ 42,211 Current Liabilities $ 113 $ 412 $ 407 Long-Term Liabilities — 100 0 Total Liabilities 113 512 407 Members’ Equity 40,772 44,531 41,804 Total Liabilities and Members’ Equity $ 40,885 $ 45,043 $ 42,211 Rent Revenue on Operating Lease $ 17,200 $ 17,226 $ 22,837 Expenses 2,236 8,922 11,866 Net Income $ 14,964 $ 8,304 $ 10,971

INVESTMENTS (Tables)

INVESTMENTS (Tables)	9 Months Ended
	Sep. 30, 2017
INVESTMENTS
Schedule of investments held to maturity	The Cooperative’s investments held to maturity are as follows as of September 30, 2017 and December 31, 2016 (in thousands): Gross Gross Amortized Unrealized Unrealized Cost Gains Losses Fair Value September 30, 2017: Money Market & CD’s $ 220 $ — $ — $ 220 December 31, 2016: Money Market & CD’s $ 219 $ — $ — $ 219

EMPLOYEE BENEFIT PLANS (Tables)

EMPLOYEE BENEFIT PLANS (Tables)	9 Months Ended
	Sep. 30, 2017
EMPLOYEE BENEFIT PLANS
Components of Net Periodic Benefit Cost	The following schedules provide the components of Net Periodic Benefit Cost for the nine months ended September 30, 2017 and September 30, 2016 (in thousands) : September 30, September 30, 2017 2016 Service Cost $ — $ — Interest Cost 26 28 Expected Return on Plan Assets (36) (33) Amortization of Net (Gain) Loss 1 8 Net Periodic Pension Cost $ (9) $ 3

EXPENSES (Details)

EXPENSES (Details)	12 Months Ended
	Dec. 31, 2017USD ($)
EXPENSES
Annual contractual payments to Cargill to arrange for the delivery of the corn and other agency services	$ 92,000

PROGOLD LIMITED LIABILITY COM21

PROGOLD LIMITED LIABILITY COMPANY (Details) - USD ($) $ in Thousands	9 Months Ended		12 Months Ended
	Sep. 30, 2017	Sep. 30, 2016	Dec. 31, 2016
Financial information for ProGold LLC
Current Assets	$ 533	$ 137	$ 125
Long-Term Assets	40,352	44,906	42,086
Total Assets	40,885	45,043	42,211
Current Liabilities	113	412	407
Long-Term Liabilities		100	0
Total Liabilities	113	512	407
Members' Equity	40,772	44,531	41,804
Total Liabilities and Members' Equity	40,885	45,043	42,211
Rent Revenue on Operating Lease	17,200	17,226	22,837
Expenses	2,236	8,922	11,866
Net Income	$ 14,964	$ 8,304	$ 10,971
ProGold LLC
ProGold Limited Liability Company
Ownership percentage in joint venture	49.00%

INVESTMENTS (Details)

INVESTMENTS (Details) - Money Market & CD's. - USD ($) $ in Thousands	Sep. 30, 2017	Dec. 31, 2016
Investments held to maturity
Amortized Cost	$ 220	$ 219
Fair Value	$ 220	$ 219

EMPLOYEE BENEFIT PLANS (Details

EMPLOYEE BENEFIT PLANS (Details)	1 Months Ended	9 Months Ended		12 Months Ended
	Dec. 31, 2012USD ($)employee	Sep. 30, 2017USD ($)	Sep. 30, 2016USD ($)	Dec. 31, 2017USD ($)	Dec. 31, 2016USD ($)
Components of Net Periodic Benefit Cost
Service Cost
Interest Cost		26,000	28,000
Expected return on plan assets		(36,000)	(33,000)
Amortization of net (gain) loss		1,000	8,000
Net periodic pension cost		(9,000)	3,000
Cooperative contributions		$ 3,000	$ 12,000		$ 12,000
Anticipated 2017 Contributions	$ 0			$ 6,000
Number of new employees eligible under the plan | employee	0

DISTRIBUTIONS TO MEMBERS (Detai

DISTRIBUTIONS TO MEMBERS (Details)	Jun. 23, 2017USD ($)$ / shares$ / bu	Feb. 16, 2017USD ($)$ / shares$ / bu	Sep. 30, 2017USD ($)$ / shares	Sep. 30, 2017USD ($)	Sep. 30, 2016USD ($)
DISTRIBUTIONS TO MEMBERS
Member distributions paid | $	$ 2,168,667	$ 2,215,139		$ 4,384,000	$ 6,196,000
Distribution to members per outstanding membership unit (in dollars per unit) | $ / shares	$ 0.14	$ 0.143
Authorized distribution | $			$ 2,168,667	$ 2,169,000	$ 3,253,000
Distribution to members per outstanding membership unit to be paid (in dollars per unit) | $ / shares			$ 0.14
Prior Year Approximate Distribution Paid to Members, per Bushel | $ / bu	0.20	0.20
Distribution issued (as a percent of allocated income)		30.00%

COMMITMENTS AND CONTINGENCIES (

COMMITMENTS AND CONTINGENCIES (Details)	12 Months Ended
	Dec. 31, 2017USD ($)
COMMITMENTS AND CONTINGENCIES.
Annual contractual payments to Cargill for procurement of corn	$ 92,000