Inventory Disclosure
Adjustment to Inventory: Conversion from LIFO to FIFO
Adjusted Financial Ratios: LIFO vs. FIFO (Summary)
Adjusted Current Ratio
Adjusted Net Profit Margin
Adjusted Total Asset Turnover
Adjusted Financial Leverage
Adjusted Return on Equity (ROE)
Adjusted Return on Assets (ROA)

Monsanto Co., balance sheet: inventory

US$ in millions

	Aug 31, 2017	Aug 31, 2016	Aug 31, 2015	Aug 31, 2014	Aug 31, 2013	Aug 31, 2012
Finished goods	1,477)	1,404)	1,603)	1,591)	1,079)	1,050)
Goods in process	1,446)	1,489)	1,627)	1,721)	1,619)	1,537)
Raw materials and supplies	561)	498)	420)	445)	418)	395)
Inventory at FIFO cost	3,484)	3,391)	3,650)	3,757)	3,116)	2,982)
Excess of FIFO over LIFO cost	(144)	(150)	(154)	(160)	(169)	(143)
Inventory, net	3,340)	3,241)	3,496)	3,597)	2,947)	2,839)

Based on: 10-K (reporting date: 2017-08-31), 10-K (reporting date: 2016-08-31), 10-K (reporting date: 2015-08-31), 10-K (reporting date: 2014-08-31), 10-K (reporting date: 2013-08-31), 10-K (reporting date: 2012-08-31).

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Item	Description	The company
Inventory, net	Amount after valuation and LIFO reserves of inventory expected to be sold, or consumed within one year or operating cycle, if longer.	Monsanto Co. inventory, net decreased from 2015 to 2016 but then slightly increased from 2016 to 2017.

Adjusting LIFO Inventory to FIFO (Current) Cost

US$ in millions

	Aug 31, 2017	Aug 31, 2016	Aug 31, 2015	Aug 31, 2014	Aug 31, 2013	Aug 31, 2012
Adjustment to Inventory, Net
Inventory, net at LIFO (as reported)	3,340)	3,241)	3,496)	3,597)	2,947)	2,839)
Add: Inventory LIFO reserve	144)	150)	154)	160)	169)	143)
Inventory, net at FIFO (adjusted)	3,484)	3,391)	3,650)	3,757)	3,116)	2,982)
Adjustment to Current Assets
Current assets (as reported)	8,651)	8,157)	10,625)	9,675)	10,077)	9,658)
Add: Inventory LIFO reserve	144)	150)	154)	160)	169)	143)
Current assets (adjusted)	8,795)	8,307)	10,779)	9,835)	10,246)	9,801)
Adjustment to Total Assets
Total assets (as reported)	21,333)	19,736)	21,920)	21,981)	20,664)	20,224)
Add: Inventory LIFO reserve	144)	150)	154)	160)	169)	143)
Total assets (adjusted)	21,477)	19,886)	22,074)	22,141)	20,833)	20,367)
Adjustment to Total Monsanto Company Shareowners’ Equity
Total Monsanto Company shareowners’ equity (as reported)	6,438)	4,534)	6,990)	7,875)	12,559)	11,833)
Add: Inventory LIFO reserve	144)	150)	154)	160)	169)	143)
Total Monsanto Company shareowners’ equity (adjusted)	6,582)	4,684)	7,144)	8,035)	12,728)	11,976)
Adjustment to Net Income Attributable To Monsanto Company
Net income attributable to Monsanto Company (as reported)	2,260)	1,336)	2,314)	2,740)	2,482)	2,045)
Add: Increase (decrease) in inventory LIFO reserve	(6)	(4)	(6)	(9)	26)	(43)
Net income attributable to Monsanto Company (adjusted)	2,254)	1,332)	2,308)	2,731)	2,508)	2,002)

Based on: 10-K (reporting date: 2017-08-31), 10-K (reporting date: 2016-08-31), 10-K (reporting date: 2015-08-31), 10-K (reporting date: 2014-08-31), 10-K (reporting date: 2013-08-31), 10-K (reporting date: 2012-08-31).

Monsanto Co. inventory value on Aug 31, 2017 would be $3,484) (in millions) if the FIFO inventory method was used instead of LIFO. Monsanto Co. inventories, valued on a LIFO basis, on Aug 31, 2017 were $3,340). Monsanto Co. inventories would have been $144) higher than reported on Aug 31, 2017 if the FIFO method had been used instead.

Monsanto Co., Financial Data: Reported vs. Adjusted

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Monsanto Co., adjusted financial ratios

	Aug 31, 2017	Aug 31, 2016	Aug 31, 2015	Aug 31, 2014	Aug 31, 2013	Aug 31, 2012
Current Ratio
Reported current ratio (LIFO)	1.35	1.21	2.05	1.89	2.32	2.29
Adjusted current ratio (FIFO)	1.37	1.23	2.08	1.92	2.36	2.32
Net Profit Margin
Reported net profit margin (LIFO)	15.44%	9.89%	15.43%	17.28%	16.70%	15.14%
Adjusted net profit margin (FIFO)	15.40%	9.87%	15.39%	17.22%	16.88%	14.83%
Total Asset Turnover
Reported total asset turnover (LIFO)	0.69	0.68	0.68	0.72	0.72	0.67
Adjusted total asset turnover (FIFO)	0.68	0.68	0.68	0.72	0.71	0.66
Financial Leverage
Reported financial leverage (LIFO)	3.31	4.35	3.14	2.79	1.65	1.71
Adjusted financial leverage (FIFO)	3.26	4.25	3.09	2.76	1.64	1.70
Return on Equity (ROE)
Reported ROE (LIFO)	35.10%	29.47%	33.10%	34.79%	19.76%	17.28%
Adjusted ROE (FIFO)	34.24%	28.44%	32.31%	33.99%	19.70%	16.72%
Return on Assets (ROA)
Reported ROA (LIFO)	10.59%	6.77%	10.56%	12.47%	12.01%	10.11%
Adjusted ROA (FIFO)	10.49%	6.70%	10.46%	12.33%	12.04%	9.83%

Based on: 10-K (reporting date: 2017-08-31), 10-K (reporting date: 2016-08-31), 10-K (reporting date: 2015-08-31), 10-K (reporting date: 2014-08-31), 10-K (reporting date: 2013-08-31), 10-K (reporting date: 2012-08-31).

Financial ratio	Description	The company
Adjusted current ratio	A liquidity ratio calculated as adjusted current assets divided by current liabilities.	Monsanto Co. adjusted current ratio deteriorated from 2015 to 2016 but then slightly improved from 2016 to 2017.
Adjusted net profit margin	An indicator of profitability, calculated as adjusted net income divided by revenue.	Monsanto Co. adjusted net profit margin ratio deteriorated from 2015 to 2016 but then improved from 2016 to 2017 exceeding 2015 level.
Adjusted total asset turnover	An activity ratio calculated as total revenue divided by adjusted total assets.	Monsanto Co. adjusted total asset turnover ratio deteriorated from 2015 to 2016 but then improved from 2016 to 2017 exceeding 2015 level.
Adjusted financial leverage	A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity. Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income.	Monsanto Co. adjusted financial leverage ratio increased from 2015 to 2016 but then slightly decreased from 2016 to 2017 not reaching 2015 level.
Adjusted ROE	A profitability ratio calculated as adjusted net income divided by adjusted shareholders’ equity.	Monsanto Co. adjusted ROE deteriorated from 2015 to 2016 but then improved from 2016 to 2017 exceeding 2015 level.
Adjusted ROA	A profitability ratio calculated as adjusted net income divided by adjusted total assets.	Monsanto Co. adjusted ROA deteriorated from 2015 to 2016 but then improved from 2016 to 2017 exceeding 2015 level.

Monsanto Co., Financial Ratios: Reported vs. Adjusted

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	Aug 31, 2017	Aug 31, 2016	Aug 31, 2015	Aug 31, 2014	Aug 31, 2013	Aug 31, 2012
As Reported
Selected Financial Data (US$ in millions)
Current assets	8,651)	8,157)	10,625)	9,675)	10,077)	9,658)
Current liabilities	6,398)	6,729)	5,177)	5,112)	4,336)	4,221)
Liquidity Ratio
Current ratio¹	1.35	1.21	2.05	1.89	2.32	2.29
Adjusted: After Conversion from LIFO to FIFO
Selected Financial Data (US$ in millions)
Adjusted current assets	8,795)	8,307)	10,779)	9,835)	10,246)	9,801)
Current liabilities	6,398)	6,729)	5,177)	5,112)	4,336)	4,221)
Liquidity Ratio
Adjusted current ratio²	1.37	1.23	2.08	1.92	2.36	2.32

Based on: 10-K (reporting date: 2017-08-31), 10-K (reporting date: 2016-08-31), 10-K (reporting date: 2015-08-31), 10-K (reporting date: 2014-08-31), 10-K (reporting date: 2013-08-31), 10-K (reporting date: 2012-08-31).

2017 Calculations

¹ Current ratio = Current assets ÷ Current liabilities
= 8,651 ÷ 6,398 = 1.35

² Adjusted current ratio = Adjusted current assets ÷ Current liabilities
= 8,795 ÷ 6,398 = 1.37

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Liquidity ratio	Description	The company
Adjusted current ratio	A liquidity ratio calculated as adjusted current assets divided by current liabilities.	Monsanto Co. adjusted current ratio deteriorated from 2015 to 2016 but then slightly improved from 2016 to 2017.

	Aug 31, 2017	Aug 31, 2016	Aug 31, 2015	Aug 31, 2014	Aug 31, 2013	Aug 31, 2012
As Reported
Selected Financial Data (US$ in millions)
Net income attributable to Monsanto Company	2,260)	1,336)	2,314)	2,740)	2,482)	2,045)
Net sales	14,640)	13,502)	15,001)	15,855)	14,861)	13,504)
Profitability Ratio
Net profit margin¹	15.44%	9.89%	15.43%	17.28%	16.70%	15.14%
Adjusted: After Conversion from LIFO to FIFO
Selected Financial Data (US$ in millions)
Adjusted net income attributable to Monsanto Company	2,254)	1,332)	2,308)	2,731)	2,508)	2,002)
Net sales	14,640)	13,502)	15,001)	15,855)	14,861)	13,504)
Profitability Ratio
Adjusted net profit margin²	15.40%	9.87%	15.39%	17.22%	16.88%	14.83%

Based on: 10-K (reporting date: 2017-08-31), 10-K (reporting date: 2016-08-31), 10-K (reporting date: 2015-08-31), 10-K (reporting date: 2014-08-31), 10-K (reporting date: 2013-08-31), 10-K (reporting date: 2012-08-31).

2017 Calculations

¹ Net profit margin = 100 × Net income attributable to Monsanto Company ÷ Net sales
= 100 × 2,260 ÷ 14,640 = 15.44%

² Adjusted net profit margin = 100 × Adjusted net income attributable to Monsanto Company ÷ Net sales
= 100 × 2,254 ÷ 14,640 = 15.40%

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Profitability ratio	Description	The company
Adjusted net profit margin	An indicator of profitability, calculated as adjusted net income divided by revenue.	Monsanto Co. adjusted net profit margin ratio deteriorated from 2015 to 2016 but then improved from 2016 to 2017 exceeding 2015 level.

	Aug 31, 2017	Aug 31, 2016	Aug 31, 2015	Aug 31, 2014	Aug 31, 2013	Aug 31, 2012
As Reported
Selected Financial Data (US$ in millions)
Net sales	14,640)	13,502)	15,001)	15,855)	14,861)	13,504)
Total assets	21,333)	19,736)	21,920)	21,981)	20,664)	20,224)
Activity Ratio
Total asset turnover¹	0.69	0.68	0.68	0.72	0.72	0.67
Adjusted: After Conversion from LIFO to FIFO
Selected Financial Data (US$ in millions)
Net sales	14,640)	13,502)	15,001)	15,855)	14,861)	13,504)
Adjusted total assets	21,477)	19,886)	22,074)	22,141)	20,833)	20,367)
Activity Ratio
Adjusted total asset turnover²	0.68	0.68	0.68	0.72	0.71	0.66

Based on: 10-K (reporting date: 2017-08-31), 10-K (reporting date: 2016-08-31), 10-K (reporting date: 2015-08-31), 10-K (reporting date: 2014-08-31), 10-K (reporting date: 2013-08-31), 10-K (reporting date: 2012-08-31).

2017 Calculations

¹ Total asset turnover = Net sales ÷ Total assets
= 14,640 ÷ 21,333 = 0.69

² Adjusted total asset turnover = Net sales ÷ Adjusted total assets
= 14,640 ÷ 21,477 = 0.68

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Activity ratio	Description	The company
Adjusted total asset turnover	An activity ratio calculated as total revenue divided by adjusted total assets.	Monsanto Co. adjusted total asset turnover ratio deteriorated from 2015 to 2016 but then improved from 2016 to 2017 exceeding 2015 level.

	Aug 31, 2017	Aug 31, 2016	Aug 31, 2015	Aug 31, 2014	Aug 31, 2013	Aug 31, 2012
As Reported
Selected Financial Data (US$ in millions)
Total assets	21,333)	19,736)	21,920)	21,981)	20,664)	20,224)
Total Monsanto Company shareowners’ equity	6,438)	4,534)	6,990)	7,875)	12,559)	11,833)
Solvency Ratio
Financial leverage¹	3.31	4.35	3.14	2.79	1.65	1.71
Adjusted: After Conversion from LIFO to FIFO
Selected Financial Data (US$ in millions)
Adjusted total assets	21,477)	19,886)	22,074)	22,141)	20,833)	20,367)
Adjusted total Monsanto Company shareowners’ equity	6,582)	4,684)	7,144)	8,035)	12,728)	11,976)
Solvency Ratio
Adjusted financial leverage²	3.26	4.25	3.09	2.76	1.64	1.70

Based on: 10-K (reporting date: 2017-08-31), 10-K (reporting date: 2016-08-31), 10-K (reporting date: 2015-08-31), 10-K (reporting date: 2014-08-31), 10-K (reporting date: 2013-08-31), 10-K (reporting date: 2012-08-31).

2017 Calculations

¹ Financial leverage = Total assets ÷ Total Monsanto Company shareowners’ equity
= 21,333 ÷ 6,438 = 3.31

² Adjusted financial leverage = Adjusted total assets ÷ Adjusted total Monsanto Company shareowners’ equity
= 21,477 ÷ 6,582 = 3.26

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Solvency ratio	Description	The company
Adjusted financial leverage	A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity. Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income.	Monsanto Co. adjusted financial leverage ratio increased from 2015 to 2016 but then slightly decreased from 2016 to 2017 not reaching 2015 level.

	Aug 31, 2017	Aug 31, 2016	Aug 31, 2015	Aug 31, 2014	Aug 31, 2013	Aug 31, 2012
As Reported
Selected Financial Data (US$ in millions)
Net income attributable to Monsanto Company	2,260)	1,336)	2,314)	2,740)	2,482)	2,045)
Total Monsanto Company shareowners’ equity	6,438)	4,534)	6,990)	7,875)	12,559)	11,833)
Profitability Ratio
ROE¹	35.10%	29.47%	33.10%	34.79%	19.76%	17.28%
Adjusted: After Conversion from LIFO to FIFO
Selected Financial Data (US$ in millions)
Adjusted net income attributable to Monsanto Company	2,254)	1,332)	2,308)	2,731)	2,508)	2,002)
Adjusted total Monsanto Company shareowners’ equity	6,582)	4,684)	7,144)	8,035)	12,728)	11,976)
Profitability Ratio
Adjusted ROE²	34.24%	28.44%	32.31%	33.99%	19.70%	16.72%

Based on: 10-K (reporting date: 2017-08-31), 10-K (reporting date: 2016-08-31), 10-K (reporting date: 2015-08-31), 10-K (reporting date: 2014-08-31), 10-K (reporting date: 2013-08-31), 10-K (reporting date: 2012-08-31).

2017 Calculations

¹ ROE = 100 × Net income attributable to Monsanto Company ÷ Total Monsanto Company shareowners’ equity
= 100 × 2,260 ÷ 6,438 = 35.10%

² Adjusted ROE = 100 × Adjusted net income attributable to Monsanto Company ÷ Adjusted total Monsanto Company shareowners’ equity
= 100 × 2,254 ÷ 6,582 = 34.24%

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Profitability ratio	Description	The company
Adjusted ROE	A profitability ratio calculated as adjusted net income divided by adjusted shareholders’ equity.	Monsanto Co. adjusted ROE deteriorated from 2015 to 2016 but then improved from 2016 to 2017 exceeding 2015 level.

	Aug 31, 2017	Aug 31, 2016	Aug 31, 2015	Aug 31, 2014	Aug 31, 2013	Aug 31, 2012
As Reported
Selected Financial Data (US$ in millions)
Net income attributable to Monsanto Company	2,260)	1,336)	2,314)	2,740)	2,482)	2,045)
Total assets	21,333)	19,736)	21,920)	21,981)	20,664)	20,224)
Profitability Ratio
ROA¹	10.59%	6.77%	10.56%	12.47%	12.01%	10.11%
Adjusted: After Conversion from LIFO to FIFO
Selected Financial Data (US$ in millions)
Adjusted net income attributable to Monsanto Company	2,254)	1,332)	2,308)	2,731)	2,508)	2,002)
Adjusted total assets	21,477)	19,886)	22,074)	22,141)	20,833)	20,367)
Profitability Ratio
Adjusted ROA²	10.49%	6.70%	10.46%	12.33%	12.04%	9.83%

Based on: 10-K (reporting date: 2017-08-31), 10-K (reporting date: 2016-08-31), 10-K (reporting date: 2015-08-31), 10-K (reporting date: 2014-08-31), 10-K (reporting date: 2013-08-31), 10-K (reporting date: 2012-08-31).

2017 Calculations

¹ ROA = 100 × Net income attributable to Monsanto Company ÷ Total assets
= 100 × 2,260 ÷ 21,333 = 10.59%

² Adjusted ROA = 100 × Adjusted net income attributable to Monsanto Company ÷ Adjusted total assets
= 100 × 2,254 ÷ 21,477 = 10.49%

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Profitability ratio	Description	The company
Adjusted ROA	A profitability ratio calculated as adjusted net income divided by adjusted total assets.	Monsanto Co. adjusted ROA deteriorated from 2015 to 2016 but then improved from 2016 to 2017 exceeding 2015 level.

Monsanto Co. (NYSE:MON)

Analysis of Inventory

Inventory Disclosure

Adjustment to Inventory: Conversion from LIFO to FIFO

Monsanto Co., Financial Data: Reported vs. Adjusted

Adjusted Financial Ratios: LIFO vs. FIFO (Summary)

Monsanto Co., Financial Ratios: Reported vs. Adjusted

Adjusted Current Ratio

Adjusted Net Profit Margin

Adjusted Total Asset Turnover

Adjusted Financial Leverage

Adjusted Return on Equity (ROE)

Adjusted Return on Assets (ROA)