NOTE 3. SALES OF ACCOUNTS RECEIVABLE

The Company has a $200.0 million U.S. sale of accounts receivable program which expires on August 15, 2017. Under the program, CMC contributes, and several of its subsidiaries sell without recourse, certain eligible trade accounts receivable to CMC Receivables, Inc. ("CMCRV"), a wholly owned subsidiary of CMC. CMCRV is structured to be a bankruptcy-remote entity and was formed for the sole purpose of buying and selling trade accounts receivable generated by the Company. CMCRV sells the trade accounts receivable in their entirety to three financial institutions. With the consent of both CMCRV and the program's administrative agent, the amount advanced by the financial institutions can be increased to a maximum of $300.0 million for all trade accounts receivable sold. The remaining portion of the purchase price of the trade accounts receivable takes the form of subordinated notes from the respective financial institutions. These notes will be satisfied from the ultimate collection of the trade accounts receivable after payment of certain fees and other costs. The Company accounts for sales of the trade accounts receivable as true sales, and the trade accounts receivable balances that are sold are removed from the consolidated balance sheets. The cash advances received are reflected as cash provided by operating activities on the Company's consolidated statements of cash flows. Additionally, the U.S. sale of accounts receivable program contains certain cross-default provisions whereby a termination event could occur if the Company defaulted under certain of its credit arrangements. The covenants contained in the receivables purchase agreement are consistent with the credit facility described in Note 7, Credit Arrangements.

At November 30, 2014 and August 31, 2014, under its U.S. sale of accounts receivable program, the Company had sold $412.9 million and $389.6 million of trade accounts receivable, respectively, to the financial institutions. At November 30, 2014, the Company had no advance payments outstanding on the sale of its trade accounts receivable. The Company had $55.0 million in advance payments outstanding on the sale of its trade accounts receivable at August 31, 2014.

In addition to the U.S. sale of accounts receivable program described above, the Company's international subsidiaries in Europe and Australia sell trade accounts receivable to financial institutions without recourse. These arrangements constitute true sales, and once the trade accounts receivable are sold, they are no longer available to the Company's creditors in the event of bankruptcy. The European program allows the Company's European subsidiaries to obtain an advance of up to 90% of eligible trade accounts receivable sold under the terms of the arrangement. In October 2014, the Company entered into a first amendment to its Australian program which extended the maturity date to October 2016. Under the Australian program, trade accounts receivable balances are sold to a special purpose vehicle, which in turn sells 100% of the eligible trade accounts receivable of Commercial Metals Pty. Ltd., CMC Steel Distribution Pty. Ltd. and G.A.M. Steel Pty. Ltd. to the financial institution. The financial institution will fund up to A$75.0 million for all trade accounts receivable sold, and the remaining portion of the purchase price of the trade accounts receivable is in the form of a subordinated note from the financial institution. This note will be satisfied from the ultimate collection of the trade accounts receivable after payment of certain fees and other costs. The Company accounts for sales of the trade accounts receivable as true sales, and the trade accounts receivable balances that are sold are removed from the consolidated balance sheets. The cash advances received are reflected as cash provided by operating activities on the Company's consolidated statements of cash flows.

At November 30, 2014 and August 31, 2014, under its European and Australian programs, the Company had sold $122.0 million and $147.3 million of trade accounts receivable, respectively, to third-party financial institutions and received advance payments of $57.3 million and $90.5 million, respectively.

During the three months ended November 30, 2014 and 2013, cash proceeds from the U.S. and international sale of accounts receivable programs were $118.9 million and $162.8 million, respectively, and cash payments to the owners of accounts receivable were $207.1 million and $159.4 million, respectively. For a nominal servicing fee, the Company is responsible for servicing the trade accounts receivable for the U.S. and Australian programs. Discounts on U.S. and international sales of trade accounts receivable were $0.5 million for both of the three months ended November 30, 2014 and 2013, and are included in selling, general and administrative expenses in the Company's consolidated statements of earnings.

The deferred purchase price on the Company's U.S. and European and the Commercial Metals Pty. Ltd. sale of accounts receivable programs are included in accounts receivable on the Company's consolidated balance sheets. The deferred purchase price on the CMC Steel Distribution Pty. Ltd. and the G.A.M. Steel Pty. Ltd. sale of accounts receivable programs are included in assets of businesses held for sale on the Company's consolidated balance sheets. The following tables summarize the activity of the deferred purchase price receivables for the U.S. and international sale of accounts receivable programs:



	Three Months Ended November 30, 2014
(in thousands)	Total			U.S.			Australia*			Europe
Beginning balance	$	385,169		$	329,797		$	34,071		$	21,301
Transfers of accounts receivable	1,128,244			949,163			90,729			88,352
Collections	(1,041,573		)	(870,640		)	(102,424		)	(68,509		)
Ending balance	$	471,840		$	408,320		$	22,376		$	41,144

* Includes the sales of accounts receivable activities related to businesses held for sale (transfers of accounts receivable of $60.5 million and collections of $63.6 million).



	Three Months Ended November 30, 2013
(in thousands)	Total			U.S.			Australia			Europe
Beginning balance	$	453,252		$	358,822		$	64,996		$	29,434
Transfers of accounts receivable	1,037,205			840,571			73,120			123,514
Collections	(1,042,922		)	(847,878		)	(65,804		)	(129,240		)
Program termination	(72,312		)	—			(72,312		)	—
Ending balance	$	375,223		$	351,515		$	—		$	23,708