September 30, 2015 QUARTERLY REPORT TO SHAREHOLDERS

Transcription

1 September 30, 2015 QUARTERLY REPORT TO SHAREHOLDERS OFFICE LOCATIONS Blackfoot Admin/Branch Office Rexburg Branch Office American Falls Branch Office 188 W Judicial St 1586 N 2 nd E 2883 Highway 39 PO Box 985 PO Box 386 PO Box 300 Blackfoot, ID Rexburg, ID American Falls, Idaho (208) or (800) (208) or (800) (208) or (800) Twin Falls Contact Point Suite 100A 1096 Eastland Drive North Twin Falls, ID (208) or (800) DIRECTORS, OFFICERS AND STAFF BOARD OF DIRECTORS Ken Black, Chairman...Burley Twain S. Hayden, Vice Chairman... Arbon Jennifer Ellis... Blackfoot Scott R. Giltner...Jerome Bruce Ricks...Sugar City Dennis W. Snarr... Idaho Falls Mike Virtue... Blackfoot OFFICERS Marc Fonnesbeck... President, CEO and CCO Jim Chase...Secretary and CFO Adam C. Jensen...Vice President Kirk Powell...Assistant Vice President HEADQUARTERS STAFF Ryan Funk...IT Administrator and Programmer Ingrid Denning... Operations Assistant Jan Gamble... Operations Assistant BRANCH STAFF Blackfoot Branch (208) Katie Wallace... Branch Manager Andy Line...Loan Officer Leisa Cushman...Operations Assistant Rexburg Branch (208) Kirk Powell... Branch Manager Doug Eck...Senior Loan Officer Nick Bazil...Loan Officer Mike Hale...Credit Analyst Carrie Mackert...Senior Operations Assistant Tina Morton...Senior Loan Processing Specialist Louise Hymas...Operations Assistant American Falls Branch (208) Dana Wood... Branch Manager Rachel Jenkins...Operations Assistant Meagan Reed...Operations Assistant Twin Falls Contact Point (208) Sean Zaugg...Senior Loan Officer Tianna Fife...Loan Officer

2 Idaho AgCredit, ACA Quarterly Report Page 2 REPORT OF MANAGEMENT The consolidated financial statements of Idaho AgCredit, ACA and its wholly owned subsidiaries Idaho AgCredit, FLCA and Idaho AgCredit, PCA (collectively Idaho AgCredit) are prepared by management, which is responsible for their integrity and objectivity, including amounts that must necessarily be based on judgments and estimates. The consolidated financial statements have been prepared in conformity with generally accepted accounting principles appropriate under the circumstances and under the oversight of the Audit Committee (comprised of all board members), and in the opinion of management, fairly present the financial condition and results of operations of Idaho AgCredit. To meet its responsibility for reliable financial information, management depends on Idaho AgCredit's accounting and internal control systems, which have been designed to provide reasonable, but not absolute, assurance that assets are safeguarded and that transactions are properly authorized and recorded. The systems have been designed to provide the information to facilitate the recognition of costs in relation to benefits derived. To monitor compliance, Idaho AgCredit's staff, contract auditors, CoBank, ACB (CoBank) and an independent accounting firm perform reviews of the accounting records, review accounting systems and internal controls, and recommend improvements as appropriate. The 2014 consolidated financial statements of Idaho AgCredit were audited by Wipfli LLP, certified public accountants (CPAs), who also conducted a review of the accounting records and such other auditing procedures as they considered necessary to comply with generally accepted auditing standards. A copy of their report was presented in the 2014 Annual Report to Shareholders (Annual Report). The activities of Idaho AgCredit are also reviewed by the Farm Credit Administration (FCA), and certain actions of Idaho AgCredit are subject to approval by CoBank. Certain actions of CoBank are also subject to FCA approval. Idaho AgCredit (and therefore shareholders' investment in Idaho AgCredit) is materially affected by CoBank's financial condition and results of operations. The annual and quarterly reports of Idaho AgCredit and CoBank are available upon request at no cost at Idaho AgCredit's administrative and branch offices, or on the websites at and respectively. The Board of Directors and Audit Committee have overall responsibility for Idaho AgCredit's systems of internal control and financial reporting. In connection with this obligation, each consults regularly with management and periodically reviews the scope and results of work performed by the CPAs. The CPAs also have direct access to the Board of Directors and Audit Committee. The undersigned hereby certify that this report has been reviewed and prepared in accordance with all applicable statutory or regulatory requirements and that the information contained herein is true, accurate, and complete to the best of the undersigned's knowledge and belief. Ken Black, Marc Fonnesbeck, Jim Chase Board Chairman and President, CEO and CCO Secretary and CFO Audit Committee Chairman October 20, 2015

3 Idaho AgCredit, ACA Quarterly Report Page 3 MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Overview and Economic Conditions: The following discussion summarizes the financial position and results of operations of Idaho AgCredit for the three months ended September 30, 2015, with comparisons to prior periods. You should read these comments along with the accompanying financial statements and footnotes and the 2014 Annual Report to Shareholders. The accompanying financial statements were prepared under the oversight of the Audit Committee. Economic conditions for the three months ended September 30, 2015, reflect average commodity prices except potatoes and alfalfa, which are at breakeven or below. Projected prices for 2015 reflect a general weakening in prices, with margins narrowing because costs for inputs are unlikely to weaken as much as commodity prices. Most crops and livestock are expected to remain profitable, but some may remain near or below breakeven. Water has been adequate in most areas. Agricultural real estate prices appear to be steady and strong. The increases in real estate values in the last several years could lead to increased loan risk on those operations which purchased higher cost land if real estate values and rental rates decrease. Idaho AgCredit's net income reflects the strong economic success of its customers. Loan Portfolio: Gross loan volume as of September 30, 2015, increased $10,822,669 from $236,196,888 at the prior quarter end to $247,019,557, and increased $2,340,816 compared to September 30 of the prior year. The current quarter change in loan volume reflected seasonal increases in operating loan volume and a slight increase in mortgage loan volume. The increase in gross loan volume from the prior year reflects higher borrowing by farmers in part due to some net operating losses for 2014 and some expanded operations. Nonaccrual loan volume at September 30, 2015, was $62,319, or.03% of gross loan volume, compared to $74,435, or.03% on the same date in the prior year. Idaho AgCredit's total loan portfolio is presently graded 99.9% acceptable compared to 99.9% acceptable in the prior year. Idaho AgCredit's long-term goal for acceptable credit remains at 90.0% or better. Idaho AgCredit had no net investment in other property owned (aka acquired property) at September 30, 2015, which was the same as on the same date in the prior year. Idaho AgCredit's investment in accrual sales contracts at September 30, 2015, was $90,304 compared to $97,593 in the prior year. Idaho AgCredit's ratio of liabilities to net worth at September 30, 2015, was 4.01:1 compared to 4.16:1 the prior year. This ratio change (which reflects that net worth has increased in proportion to total liabilities) has been caused by slower loan volume growth, adequate earnings and an overall strong capital position. Results of Operations: Idaho AgCredit's net income of $1,078,727 for the quarter was up $82,614 compared to the same quarter in the prior year. The net interest income after the provision for losses of loan principal and commitment was $26,048 higher than the same period in the prior year due to an increase in net interest income of $33,703 and an increase in the net provision for loan losses of $7,655. Noninterest income was $2,286 higher. Noninterest expenses for the current quarter were $76,630 lower than the prior year due to the decrease in salaries of $79,959, decrease in occupancy of $17,661, increase in Farm Credit Insurance Fund premiums of $4,000, increase in purchased services of $28,017 and decrease in all other noninterest expenses of $11,027. The provision for income taxes was $22,350 higher than the prior year due to a higher estimate of income taxes. The Allowance for Loan Losses account balance at September 30, 2015 totaled $974,608 or.39% of gross loan volume compared to an allowance of $957,769 or.39% of gross loan volume for the same date in the prior year. This increase of $16,839 from the prior year reflects a reduction due to a calculation methodology change to exclude loan commitment, an increase of $100,000 due to a management adjustment to reflect current risk factors in the portfolio, and an increase due to normal changes in credit quality and volume. After assessing the relative risk based upon economic conditions, historical annual loan loss experience and potential future losses, management believes the allowance for loan losses adequately covers the inherent risk in the loan portfolio. Ultimate losses which may be experienced by Idaho AgCredit depend upon the impact of future commodity prices, real estate values, government subsidy and disaster programs, weather-related occurrences, operating decisions and public policy. These same factors may also generate recoveries to of losses previously recognized.

4 Idaho AgCredit, ACA Quarterly Report Page 4 Capital Resources: Shareholders' equity at September 30, 2015, was $52,732,394, which increased $2,867,746 from $49,864,648 at December 31, This increase is due to net income plus net stock changes. Since January 1, 2005, Idaho AgCredit's stock requirement has been the minimum allowed by regulation, which is the lesser of 2% of the outstanding principal balance or $1,000 per customer.

5 Idaho AgCredit, ACA Quarterly Report Page 5 CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION September 30 December 31, September Unaudited Audited Unaudited ASSETS Loans $247,019,557 $254,990,837 $244,678,741 Less allowance for loan losses 974, , ,769 Net loans 246,044, ,029, ,720,972 Cash 728,791 1,402, ,672 Accrued interest receivable 4,310,515 3,839,441 4,428,509 Investment in CoBank 10,923,007 10,913,184 10,913,184 Premises and equipment, net 1,299,517 1,335,462 1,315,024 Other property owned Deferred tax asset, net 89,000 89,000 87,000 Other assets 863,604 1,093, ,150 Total assets $264,259,383 $272,702,629 $261,477,511 LIABILITIES Note payable to CoBank $207,804,911 $215,815,206 $205,253,800 Advance conditional payments 2,552,550 4,085,087 4,371,324 Accrued interest payable 360, , ,879 Patronage distributions payable 0 1,859,442 0 Pension liability 248, , ,578 Reserve for losses on loan commitment 35, Other liabilities 524, , ,834 Total liabilities $211,526,989 $222,837,981 $210,844,415 Commitments and Contingencies (See Notes) SHAREHOLDERS' EQUITY Capital stock and participation certificates $419,005 $390,785 $406,905 Allocated retained earnings Unallocated retained earnings 52,313,389 49,473,863 50,226,191 Accumulated other comprehensive income/(loss) Total shareholders' equity $52,732,394 $49,864,648 $50,633,096 Total liabilities and shareholders' equity $264,259,383 $272,702,629 $261,477,511 The accompanying notes are an integral part of these financial statements.

6 Idaho AgCredit, ACA Quarterly Report Page 6 CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME Three Months Ended Nine Months Ended September 30 September INTEREST INCOME Loans $2,784,595 $2,765,852 $8,034,544 $8,025,721 Other Total interest income 2,784,595 2,765,852 8,034,544 8,025,721 INTEREST EXPENSE Notes payable to CoBank 1,058,485 1,072,814 3,141,173 3,151,537 Advance conditional payments 4,559 5,190 18,314 23,770 Total interest expense 1,063,044 1,078,004 3,159,487 3,175,307 Net interest income 1,721,551 1,687,848 4,875,057 4,850,414 (Provision for) or reversal of loan losses (25,586) (17,931) (49,347) (30,087) Net interest income after (provision)/reversal 1,695,965 1,669,917 4,825,710 4,820,327 NONINTEREST INCOME Patronage distributions from CoBank 238, , , ,506 Patronage distributions from other Farm Credit Inst ,008 37,793 51,594 Loan fees 8,725 9,335 70,315 70,041 Financially related services income 1,119 1,746 3,399 3,154 Other noninterest income 1,235 (15,136) 1,939 3,174 Total Noninterest Income 249, , , ,469 NONINTEREST EXPENSE Salaries and employee benefits 511, ,108 1,748,951 1,841,240 Director's Compensation 6,564 7,015 22,013 21,969 Occupancy and equipment 33,084 50, , ,220 Farm Credit Insurance Fund premiums 55,000 51, , ,000 Supervisory and examination costs 19,144 20,473 64,044 61,421 Data processing services 2,430 3,690 7,710 11,070 Purchased services 77,253 49, , ,694 Losses/(Gains) on other property owned, net Other noninterest expense 93, , , ,363 Total noninterest expense 798, ,857 2,565,385 2,662,977 Income (loss) before income taxes 1,146,977 1,042,013 3,054,767 2,958,819 (Provision for)/benefit from income taxes (68,250) (45,900) (215,242) (129,950) Net Income/Comprehensive income $1,078,727 $996,113 $2,839,525 $2,828,869 The accompanying notes are an integral part of these financial statements.

7 Idaho AgCredit, ACA Quarterly Report Page 7 CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY Capital Accumulated Stock and Unallocated Other Total Participation Retained Comprehensive Shareholders' Certificates Earnings Income/(Loss) Equity Balance at December 31, 2013 $390,780 $47,397,322 $0 $47,788,102 Net income/comprehensive Income 2,828,869 2,828,869 Stock issued 99,840 99,840 Stock retired (83,715) (83,715) Other (rounding) 0 0 Balance at September 30, 2014 $406,905 $50,226,191 $0 $50,633,096 Balance at December 31, 2014 $390,785 $49,473,863 $0 $49,864,648 Net income/comprehensive Income 2,839,525 2,839,525 Stock issued 127, ,890 Stock retired (99,670) (99,670) Other (rounding) 1 1 Balance at September 30, 2015 $419,005 $52,313,389 $0 $52,732,394 The accompanying notes are an integral part of these financial statements.

8 Idaho AgCredit, ACA Quarterly Report Page 8 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Note 1 Organization and Significant Accounting Policies: A description of the organization and operations of Idaho AgCredit, ACA (Idaho AgCredit), the significant accounting policies followed, and the financial condition and results of operations as of and for the year ended December 31, 2014, are contained in the 2014 Annual Report to Shareholders (Annual Report). The accompanying unaudited thirdquarter 2015 financial statements have been prepared in accordance with the accounting principles generally accepted in the U.S. (GAAP) for interim financial information. Accordingly, they do not include all the disclosures required by GAAP for annual financial statements and should be read in conjunction with the audited financial statements as of and for the year ended December 31, 2014, as contained in the Annual Report. In the opinion of management, the unaudited financial information is complete and reflects all adjustments necessary for a fair statement of results for the interim periods. The preparation of financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates. The results of operations for interim periods are not necessarily indicative of the results to be expected for the full year ending December 31, Descriptions of the significant accounting policies are included in the Annual Report. In the opinion of management, these policies and the presentation of the interim financial condition and results of operations conform with GAAP and prevailing practices within the banking industry. In May 2014, the Financial Accounting Standards Board (FASB) issued guidance entitled, Revenue from Contracts with Customers. The guidance governs revenue recognition from contracts with customers and requires an entity to 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. Financial instruments and other contractual rights within the scope of other guidance issued by the FASB are excluded from the scope of this new revenue recognition guidance. In this regard, a majority of our contracts would be excluded from the scope of this new guidance. In August 2015, the FASB issued an update that defers this guidance by one year, which results in the new revenue standard becoming effective for interim and annual reporting periods beginning after December 15, Idaho AgCredit is in the process of reviewing contracts to determine the effect, if any, on its financial condition or its results of operations. In August 2014, the FASB issued guidance entitled "Presentation of Financial Statements Going Concern." The guidance governs management's responsibility to evaluate whether there is substantial doubt about an entity's ability to continue as a going concern and to provide related footnote disclosures. This guidance requires management to perform interim and annual assessments of an entity's ability to continue as a going concern within one year after the date the financial statements are issued or within one year after the financial statements are available to be issued, when applicable. Substantial doubt exists if it is probable that the entity will be unable to meet its obligations for the assessed period. This guidance becomes effective for the interim and annual periods ending after December 15, 2016, and early application is permitted. Management will be required to make its initial assessment as of December 31, Certain amounts in the prior period s financial statements have been reclassified to conform to the current period s financial statement presentation. Idaho AgCredit may have loans in the categories of real estate mortgage, production and intermediate term, agribusiness (which may be further broken down into loans to cooperatives, processing or marketing and farm related business), communications, energy, water and waste water, rural residential real estate, agricultural export finance, lease receivables and loans to other financial institutions. Only those categories for which Idaho AgCredit had loans are shown in these schedules. Note 2 Loans and Allowance for Loan Losses: A summary of loans (excluding related accrued interest) follows: Loans September 30, 2015 December 31, 2014 Real estate mortgage $134,357,200 $141,848,236 Production and intermediate term 105,337, ,648,338 Processing and marketing 3,318, ,371 Farm related business 4,006,858 4,753,892 Total loans $247,019,557 $254,990,837

9 Idaho AgCredit, ACA Quarterly Report Page 9 Idaho AgCredit purchases or sells participation interests with other parties in order to diversify risk, manage loan volume and comply with Farm Credit Administration regulations. All of Idaho AgCredit's participations purchased and participations sold are with other Farm Credit Institutions. The following table presents information regarding participations purchased and sold (excluding related accrued interest) as of September 30, 2015: Participations Purchased Participations Sold Real estate mortgage $22,449,890 $13,075,239 Production and intermediate term 0 424,370 Agribusiness 2,740, ,336 Total $25,190,821 $13,943,945 Nonperforming assets (including related accrued interest) and related credit quality statistics are as follows: September 30, 2015 December 31, 2014 Nonaccrual loans: Real estate mortgage $62,319 $71,406 Production and Intermediate term $0 $0 Total nonaccrual loans $62,319 $71,406 Accruing restructured loans: Total accruing restructured loans $0 $0 Accruing loans 90 days or more past due: Total accruing loans 90 days or more past due $0 $0 Total nonperforming loans $62,319 $71,406 Other property owned $0 $0 Total nonperforming assets $62,319 $71,406 The following table shows loans and related accrued interest classified under the Farm Credit Administration Uniform Loan Classification System as a percentage of total loans and related accrued interest receivable by loan type as of: September 30, 2015 December 31, 2014 Real estate mortgage Acceptable 98.8% 98.4% OAEM 1.0% 1.4% Substandard 0.2% 0.2% 100.0% 100.0% Production and intermediate term Acceptable 98.3% 98.4% OAEM 1.7% 1.6% Substandard 0.0% 0.0% 100.0% 100.0% Agribusiness Acceptable 100.0% 100.0% OAEM 0.0% 0.0% Substandard 0.0% 0.0% 100.0% 100.0% Total loans Acceptable 98.6% 98.4% OAEM 1.3% 1.5% Substandard 0.1% 0.1% 100.0% 100.0%

10 Idaho AgCredit, ACA Quarterly Report Page 10 The recorded investment in loan receivables is the face amount increased or decreased by applicable accrued interest and unamortized premium, discount, finance charges, or acquisition costs and may also reflect a previous direct write-down of the investment. The following tables provide an age analysis of past due loans (including accrued interest) as of: Days Past Due 90 Days or More Past Due Total Past Due Not Past Due or <30 Days Past Due 90 Days or More Past Due and Accruing (Dollars in Thousands) Total Loans September 30, 2015 Real estate mortgage $0 $0 $0 $137,487 $137,487 $0 Production and intermediate term , ,485 0 Processing and marketing ,321 3,321 0 Farm related business ,037 4,037 0 Total $0 $0 $0 $251,330 $251,330 $0 December 31, 2014 Real estate mortgage $0 $0 $0 $144,711 $144,711 $0 Production and intermediate term , ,601 0 Processing and marketing Farm related business ,773 4,773 0 Total $68 $0 $68 $258,762 $258,830 $0 Additional impaired loan information is as follows: At September 30, 2015 At December 31, 2014 Contractual Contractual Recorded Investment Principal Balance Related Allowance Recorded Investment Principal Balance Related Allowance Impaired loans with a related allowance for credit losses: Real estate mortgage $0 $0 $0 $0 $0 $0 Production and intermediate term Total $0 $0 $0 $0 $0 $0 Impaired loans with no related allowance for credit losses: Real estate mortgage $62,319 $103,456 $0 $71,406 $107,175 $0 Production and intermediate term Total $62,319 $103,456 $0 $71,406 $107,175 $0 Total impaired loans: Real estate mortgage $62,319 $103,456 $0 $71,406 $107,175 $0 Production and intermediate term Total $62,319 $103,456 $0 $71,406 $107,175 $0

11 Idaho AgCredit, ACA Quarterly Report Page 11 For the Quarter Ended September 30, 2015 September 30, 2014 Average Impaired Loans Interest Income Recognized Average Impaired Loans Interest Income Recognized For the Nine Months Ended September 30, 2015 September 30, 2014 Average Impaired Loans Interest Income Recognized Average Impaired Loans Interest Income Recognized (Dollars in Thousands) Impaired with a related allowance for credit losses: Real estate mortgage $0 $0 $0 $0 $0 $0 $0 $0 Prod. and intermediate term Total $0 $0 $0 $0 $0 $0 $0 $0 Impaired with no related allowance for credit losses: Real estate mortgage $64 $0 $76 $0 $67 $0 $99 $0 Prod. and intermediate term Total $64 $0 $76 $2 $74 $0 $99 $0 Total impaired loans: Real estate mortgage $64 $0 $76 $0 $67 $0 $99 $0 Prod. and intermediate term Total $64 $0 $76 $2 $74 $0 $99 $0 A summary of changes in the allowance for loan losses and period end recorded investment in loans is as follows: Provision for Loan Losses/ Beginning Balance Charge-offs Recoveries (Loan Loss Reversals) Ending Balance June 30, 2015 to September 30, 2015 Real estate mortgage $417,282 $0 $0 $1,735 $419,017 Production and intermediate term 515, , ,151 Agribusiness 6, ,440 Total $939,577 $0 $0 $35,031 $974,608 June 30, 2014 to September 30, 2014 Real estate mortgage $416,696 $0 $0 $12,173 $428,869 Production and intermediate term 516, , ,117 Agribusiness 6, (30) 6,783 Total $939,838 $0 $0 $17,931 $957,769 December 31, 2014 to September 30, 2015 Real estate mortgage $424,899 $0 $0 ($5,882) $419,017 Production and intermediate term 528, , ,151 Agribusiness 7, ,440 Total $961,043 $0 $0 $13,565 $974,608 December 31, 2013 to September 30, 2014 Real estate mortgage $435,980 $0 $0 ($7,111) $428,869 Production and intermediate term 487, , ,117 Agribusiness 4, ,325 6,783 Total $927,682 $0 $0 $30,087 $957,769

12 Idaho AgCredit, ACA Quarterly Report Page 12 A summary of recorded investment (including accrued interest) for allowance evaluations is as follows: Recorded Investments in Allowance for Loan Losses Loans Outstanding Individually Collectively Individually Collectively evaluated for evaluated for evaluated for evaluated for impairment impairment impairment impairment September 30, 2015 Real estate mortgage $0 $419,017 $62,319 $137,424,178 Production and intermediate term 0 548, ,484,845 Agribusiness 0 7, ,358,730 Total $0 $974,608 $62,319 $251,267,753 December 31, 2014 Real estate mortgage $0 $424,899 $71,406 $144,640,013 Production and intermediate term 0 528, ,600,662 Agribusiness 0 7, ,518,197 Total $0 $961,043 $71,406 $258,758,872 September 30, 2014 Real estate mortgage $0 $428,869 $74,435 $146,417,163 Production and intermediate term 0 522, ,540,514 Agribusiness 0 6, ,075,139 Total $0 $957,769 $74,435 $249,032,816 There were no loans acquired which had credit quality that had deteriorated since origination for the periods shown. A restructuring of debt constitutes troubled debt restructuring if the creditor for economic or legal reasons related to the debtor's financial difficulties grants a concession to the debtor that it would not otherwise consider. Idaho AgCredit had no troubled debt restructurings that occurred during the years represented in these statements. Note 3 Capital: There have not been any significant capitalization bylaw changes or significant other capitalization plan or status changes since the date of the Annual Report and Idaho AgCredit is in compliance with FCA capital regulations. Note 4 Income Taxes: There have not been any significant changes in the composition or valuation of tax assets or liabilities since the date of the Annual Report. Note 5 Fair Value Measurements: FASB guidance defines fair value as the exchange price that would be received for an asset or paid to transfer a liability in the principal or most advantageous market for the asset or liability. See Note 15 "Fair Value Measurements" of the Annual Report for a more complete description. Note 6 Contingent Liabilities and Litigation: Idaho AgCredit has various commitments outstanding and contingent liabilities, as described in Note 14 "Commitments and Contingencies" of the Annual Report. There have not been any significant changes related to this subject area since that report, other than normal seasonal and operational variations in the amounts of outstanding commitments and deposit balances. There are no legal actions pending against Idaho AgCredit. Note 7 Whistleblower Notices: Idaho AgCredit has established a whistleblower program to encourage reporting by any employee, customer or member of the public about any improper accounting or other activity to the Association's Audit Committee. Details about the whistleblower program and contact information for making whistleblower complaints are listed on the Association website at

13 Idaho AgCredit, ACA Quarterly Report Page 13 Note 8 Subsequent Events: Idaho AgCredit has evaluated subsequent events through October 20, 2015, which is the date the financial statements were available to be issued.