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Income Taxes | 12 Months Ended
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Aug. 26, 2017
Income Tax Disclosure [Abstract] |
Income Taxes | Note D – Income Taxes The components of income from continuing operations before income taxes are as follows:
|  | Year Ended |
(in thousands) |  | August 26, 2017 |  |  | August 27, 2016 |  |  | August 29, 2015 |
Domestic |  | $ | 1,737,401 |  |  | $ | 1,737,727 |  |  | $ | 1,676,640 |
International |  |  | 188,088 |  |  |  | 174,987 |  |  |  | 125,972 |
|  | $ | 1,925,489 |  |  | $ | 1,912,714 |  |  | $ | 1,802,612 |
The provision for income tax expense consisted of the following:
|  | Year Ended |
(in thousands) |  | August 26, 2017 |  |  | August 27, 2016 |  |  | August 29, 2015 |
Current: |  |  |  |  |  |  |  |  |  |  |  |
Federal |  | $ | 487,492 |  |  | $ | 534,621 |  |  | $ | 522,073 |
State |  |  | 31,733 |  |  |  | 39,223 |  |  |  | 41,921 |
International |  |  | 50,493 |  |  |  | 52,844 |  |  |  | 42,406 |
|  |  | 569,718 |  |  |  | 626,688 |  |  |  | 606,400 |
Deferred: |  |  |  |  |  |  |  |  |  |  |  |
Federal |  |  | 72,208 |  |  |  | 48,509 |  |  |  | 38,299 |
State |  |  | 7,769 |  |  |  | 9,453 |  |  |  | 941 |
International |  |  | (5,075 | ) |  |  | (12,943 | ) |  |  | (3,269 | )
|  |  | 74,902 |  |  |  | 45,019 |  |  |  | 35,971 |
Income tax expense |  | $ | 644,620 |  |  | $ | 671,707 |  |  | $ | 642,371 |
A reconciliation of the provision for income taxes to the amount computed by applying the federal statutory tax rate of 35% to income before income taxes is as follows:
|  | Year Ended |
(in thousands) |  | August 26, 2017 |  |  | August 27, 2016 |  |  | August 29, 2015 |
Federal tax at statutory U.S. income tax rate |  |  | 35.0% |  |  |  | 35.0% |  |  |  | 35.0% |
State income taxes, net |  |  | 1.3% |  |  |  | 1.6% |  |  |  | 1.5% |
Other |  |  | (2.8% | ) |  |  | (1.5% | ) |  |  | (0.9% | )
Effective tax rate |  |  | 33.5% |  |  |  | 35.1% |  |  |  | 35.6% |
Significant components of the Company’s deferred tax assets and liabilities were as follows:
(in thousands) |  | August 26, 2017 |  |  | August 27, 2016 |
Deferred tax assets: |  |  |  |  |  |  |  |
Net operating loss and credit carryforwards |  | $ | 48,062 |  |  | $ | 50,859 |
Accrued benefits |  |  | 96,664 |  |  |  | 93,212 |
Other |  |  | 56,052 |  |  |  | 68,600 |
Total deferred tax assets |  |  | 200,778 |  |  |  | 212,671 |
Less: Valuation allowances |  |  | (13,501 | ) |  |  | (13,338 | )
Net deferred tax asset |  |  | 187,277 |  |  |  | 199,333 |
Deferred tax liabilities: |  |  |  |  |  |  |  |
Property and equipment |  |  | (117,580 | ) |  |  | (93,943 | )
Inventory |  |  | (333,422 | ) |  |  | (315,563 | )
Prepaid Expenses |  |  | (60,920 | ) |  |  | (27,395 | )
Other |  |  | (11,158 | ) |  |  | (10,077 | )
Total deferred tax liabilities |  |  | (523,080 | ) |  |  | (446,978 | )
Net deferred tax liability |  | $ | (335,803 | ) |  | $ | (247,645 | )
Deferred taxes are not provided for temporary differences of approximately $712.6 million at August 26, 2017, and $572.0 million at August 27, 2016, representing earnings of non-U.S. subsidiaries that are intended to be permanently reinvested. If a deferred tax liability associated with these undistributed earnings had been recorded it would have been approximately $37.5 million and $35.0 million at August 26, 2017 and August 27, 2016, respectively. At August 26, 2017 and August 27, 2016, the Company had deferred tax assets of $30.8 million and $25.2 million, respectively, from net operating loss (“NOL”) carryforwards available to reduce future taxable income totaling approximately $198.2 million and $122.0 million, respectively. Certain NOLs have no expiration date and others will expire, if not utilized, in various years from fiscal 2018 through 2037. At August 26, 2017 and August 27, 2016, the Company had deferred tax assets for income tax credit carryforwards of $17.2 million and $25.7 million, respectively. Income tax credit carryforwards will expire, if not utilized, in various years from fiscal 2023 through 2027. At August 26, 2017 and August 27, 2016, the Company had a valuation allowance of $13.5 million and $13.3 million, respectively, on deferred tax assets associated with NOL and tax credit carryforwards for which management has determined it is more likely than not that the deferred tax asset will not be realized. Management believes it is more likely than not that the remaining deferred tax assets will be fully realized. A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:
(in thousands) |  | August 26, 2017 |  |  | August 27, 2016 |
Beginning balance |  | $ | 27,726 |  |  | $ | 28,434 |
Additions based on tax positions related to the current year |  |  | 7,089 |  |  |  | 7,172 |
Additions for tax positions of prior years |  |  | 278 |  |  |  | 95 |
Reductions for tax positions of prior years |  |  | (6,954 | ) |  |  | (2,405 | )
Reductions due to settlements |  |  | (1,964 | ) |  |  | (858 | )
Reductions due to statute of limitations |  |  | (3,974 | ) |  |  | (4,712 | )
Ending balance |  | $ | 22,201 |  |  | $ | 27,726 |
Included in the August 26, 2017 and the August 27, 2016 balances are $9.9 million and $15.5 million, respectively, of unrecognized tax benefits that, if recognized, would reduce the Company’s effective tax rate. The Company accrues interest on unrecognized tax benefits as a component of income tax expense. Penalties, if incurred, would be recognized as a component of income tax expense. The Company had $1.2 million and $2.8 million accrued for the payment of interest and penalties associated with unrecognized tax benefits at August 26, 2017 and August 27, 2016, respectively. The Company files U.S. federal, U.S. state and local, and international income tax returns. With few exceptions, the Company is no longer subject to state and local or Non-U.S. examinations by tax authorities for fiscal year 2013 and prior. The Company is typically engaged in various tax examinations at any given time by U.S. federal, U.S. state and local, and Non-U.S. taxing jurisidictions. As of August 26, 2017, the Company estimates that the amount of unrecognized tax benefits could be reduced by approximately $2.3 million over the next twelve months as a result of tax audit settlements. While the Company believes that it has adequately accrued for possible audit adjustments, the final resolution of these examinations cannot be determined at this time and could result in final settlements that differ from current estimates.

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- Definition The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -URI http://asc.fasb.org/topic&trid=2144680 + Details
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