DuPont 2012 Annual Report Download - page 68

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(Dollars in millions, except per share)
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Accounts receivable – trade1$4,069 $4,598
Notes receivable – trade1,2 131 207
Other31,252 1,217
$ 5,452 $6,022
1. Accounts and notes receivable – trade are net of allowances of $243 in 2012 and $292 in 2011. Allowances are equal to the estimated uncollectible amounts. That estimate is based
on historical collection experience, current economic and market conditions, and review of the current status of customers' accounts.
2. Notes receivable – trade primarily consists of receivables within the Agriculture segment for deferred payment loan programs for the sale of seed products to customers. These loans
have terms of one year or less and are primarily concentrated in North America. The company maintains a rigid pre-approval process for extending credit to customers in order to
manage overall risk and exposure associated with credit losses. As of December 31, 2012 and 2011, there were no significant past due notes receivable, nor were there any significant
impairments related to current loan agreements.
3. Other includes receivables in relation to Cozaar ®/Hyzaar® interests, fair value of derivative instruments, value added tax, general sales tax and other taxes.
Accounts and notes receivable are carried at amounts that approximate fair value.
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Finished products $4,519 $ 4,541
Semifinished products 2,407 2,293
Raw materials, stores and supplies 1,332 1,262
8,258 8,096
Adjustment of inventories to a LIFO basis (836)(901)
$ 7,422 $ 7,195
Inventory values, before LIFO adjustment, are generally determined by the average cost method, which approximates current cost. Domestic and foreign
inventories, excluding seeds, certain food-ingredients, enzymes, stores and supplies, valued under the LIFO method comprised 85 percent and 78 percent of
consolidated inventories before LIFO adjustment as of December 31, 2012 and 2011, respectively. Seed, certain food-ingredient and enzyme inventories of
$3,926 and $3,432 at December 31, 2012 and 2011, respectively, were valued under the FIFO method. Stores and supplies inventories of $263 and $258 at
December 31, 2012 and 2011, respectively, were valued under the average cost method.
Effective January 1, 2013, the company changed its method of valuing inventory held at certain of its foreign and U.S. locations from the LIFO method to the
average cost method. The company believes that the average cost method is preferable to the LIFO method as it more clearly aligns with how the company
actually manages its inventory and will improve financial reporting by better matching revenues and expenses. In addition, the change from LIFO to average
cost will enhance the comparability of our financial results with our peer companies. The impact of this change on income from continuing operations is $21,
$(73), and $2 for 2012, 2011 and 2010, respectively. As described in the accounting guidance for accounting changes and error corrections, beginning with
the first quarter 2013, the comparative Consolidated Financial Statements of prior periods will be adjusted to apply the new accounting method retrospectively.
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Buildings $5,490 $5,297
Equipment 24,090 25,338
Land 691 669
Construction 1,555 1,457
$ 31,826 $32,761
F-20