Short-Term Financing Arrangements

9 Months Ended

Jun. 30, 2011

Short-Term Financing Arrangements

Short-Term Financing Arrangements

NOTE 13 – SHORT-TERM FINANCING ARRANGEMENTS

The Company has an agreement to sell, on an ongoing basis, all of the trade accounts receivable of certain of its subsidiaries to a wholly owned, bankruptcy-remote subsidiary named Ralcorp Receivables Corporation (RRC).  As of June 30, 2011, the accounts receivable of the AIPC, J.T. Bakeries, North American Baking, Sepp's Gourmet Foods, Post Foods Canada, Bloomfield Bakers, Western Waffles, and Medallion Foods businesses had not been incorporated into the agreement and were not being sold to RRC.  RRC can in turn sell up to $135.0 of ownership interests in qualifying receivables to bank commercial paper conduits.  Ralcorp continues to service the receivables (with no significant servicing assets or liabilities) and remits collections to RRC, who remits the appropriate portion to the conduits as part of a monthly net settlement including the sale of an additional month of receivables.  Interest incurred on the funding received from the conduits totaled $.4 and $1.1 in the three and nine months ended June 30, 2011.  Accounting for this agreement changed as of the beginning of fiscal 2011, as described in Note 2.

In December 2010, the Company entered into uncommitted credit arrangements with banks totaling $150.0.  The arrangements expire in December 2011.

As of June 30, 2011, funding from the receivables securitization was $135.0 at a weighted-average interest rate of 1.19%, and borrowings under the uncommitted credit arrangements (which had an initial term maturing July 6, 2011) were $50.0 at a weighted-average interest rate of 1.66%.  These amounts are reflected on the Company's consolidated balance sheet in "Accounts and notes payable."  There were no corresponding amounts as of September 30, 2010.