Financial Instruments

3 Months Ended

Nov. 30, 2022

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivatives

In the normal course of business, we use derivative financial instruments to manage foreign currency exchange rate risk. Our derivative financial instruments consist of deliverable and non-deliverable foreign currency forward contracts.

Cash Flow Hedges

For a cash flow hedge, the effective portion of the change in estimated fair value of a hedging instrument is recorded in Accumulated other comprehensive loss as a separate component of Shareholders’ Equity and is reclassified into Cost of services in the Consolidated Income Statements during the period in which the hedged transaction is recognized. For information related to derivatives designated as cash flow hedges that were reclassified into Cost of services during the three months ended November 30, 2022 and 2021, as well as those expected to be reclassified into Cost of services in the next 12 months, see Note 4 (Accumulated Other Comprehensive Loss) to these Consolidated Financial Statements.

Other Derivatives

Realized gains or losses and changes in the estimated fair value of foreign currency forward contracts that have not been designated as hedges were net losses of $29,691 and $23,479 for the three months ended November 30, 2022 and 2021, respectively. Gains and losses on these contracts are recorded in Other income (expense), net in the Consolidated Income Statements and are offset by gains and losses on the related hedged items.

Fair Value of Derivative Instruments

The notional and fair values of all derivative instruments are as follows:


	November 30, 2022		August 31, 2022
Assets
Cash Flow Hedges
Other current assets	$	61,110	$	89,867
Other non-current assets	54,177		69,209
Other Derivatives
Other current assets	44,147		8,657
Total assets	$	159,434	$	167,733
Liabilities
Cash Flow Hedges
Other accrued liabilities	$	77,023	$	61,156
Other non-current liabilities	34,649		42,537
Other Derivatives
Other accrued liabilities	5,562		83,792
Total liabilities	$	117,234	$	187,485
Total fair value	$	42,200	$	(19,752)
Total notional value	$	10,646,500	$	11,095,604

We utilize standard counterparty master agreements containing provisions for the netting of certain foreign currency transaction obligations and for the set-off of certain obligations in the event of an insolvency of one of the parties to the transaction. In the Consolidated Balance Sheets, we record derivative assets and liabilities at gross fair value. The potential effect of netting derivative assets against liabilities under the counterparty master agreements is as follows:


	November 30, 2022		August 31, 2022
Net derivative assets	$	90,380	$	140,073
Net derivative liabilities	48,180		159,825
Total fair value	$	42,200	$	(19,752)