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Income Taxes (Tables) | 12 Months Ended
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Aug. 31, 2018
Income Tax Disclosure [Abstract] |
Income (Loss) Before Income Tax Expense | Income (loss) before income tax expense is summarized below (in thousands):
| Fiscal Year Ended August 31,
| 2018 |  | 2017 |  | 2016
U.S.(1) | $ | (426,897 | ) |  | $ | (373,690 | ) |  | $ | (317,427 | )
Non-U.S.(1) | 800,298 |  |  | 629,923 |  |  | 704,472 |
| $ | 373,401 |  |  | $ | 256,233 |  |  | $ | 387,045 |
(1) | The U.S. and non-U.S. components of income (loss) before income tax expense include the elimination of intercompany foreign dividends paid to the U.S.
Income Tax Expense (Benefit) | Income tax expense (benefit) is summarized below (in thousands):
Fiscal Year Ended August 31, | Current |  | Deferred |  | Total
2018: | U.S. – Federal | $ | 69,080 |  |  | $ | (24,342 | ) |  | $ | 44,738 |
| U.S. – State | 134 |  |  | 93 |  |  | 227 |
| Non-U.S. | 178,790 |  |  | 62,105 |  |  | 240,895 |
|  | $ | 248,004 |  |  | $ | 37,856 |  |  | $ | 285,860 |
2017: | U.S. – Federal | $ | 2,436 |  |  | $ | 253 |  |  | $ | 2,689 |
| U.S. – State | 12 |  |  | 30 |  |  | 42 |
| Non-U.S. | 188,872 |  |  | (62,537 | ) |  | 126,335 |
|  | $ | 191,320 |  |  | $ | (62,254 | ) |  | $ | 129,066 |
2016: | U.S. – Federal | $ | (649 | ) |  | $ | 73 |  |  | $ | (576 | )
| U.S. – State | (166 | ) |  | 9 |  |  | (157 | )
| Non-U.S. | 157,069 |  |  | (24,187 | ) |  | 132,882 |
|  | $ | 156,254 |  |  | $ | (24,105 | ) |  | $ | 132,149 |
Reconciliations of Income Tax Expense at U.S. Federal Statutory Income Tax Rate Compared to Actual Income Tax Expense | Reconciliations of the income tax expense at the U.S. federal statutory income tax rate compared to the actual income tax expense are summarized below (in thousands):
| Fiscal Year Ended August 31,
| 2018 |  | 2017 |  | 2016
Tax at U.S. federal statutory income tax rate(1) | $ | 95,852 |  |  | $ | 89,682 |  |  | $ | 135,470 |
State income taxes, net of federal tax benefit | (5,417 | ) |  | (8,474 | ) |  | (5,121 | )
Impact of foreign tax rates(2) | (71,889 | ) |  | (109,466 | ) |  | (144,521 | )
Permanent impact of non-deductible cost | 21,988 |  |  | 7,336 |  |  | 3,408 |
Income tax credits | (10,405 | ) |  | (16,254 | ) |  | (5,040 | )
Changes in tax rates on deferred tax assets and liabilities(3) | 15,048 |  |  | 688 |  |  | 182 |
Transition tax related to the Tax Act(4) | 232,405 |  |  | — |  |  | — |
Change in indefinite reinvestment assertion related to the Tax Act(5) | 21,754 |  |  | — |  |  | — |
Valuation allowance(6) | (61,186 | ) |  | 37,934 |  |  | 11,770 |
Non-deductible equity compensation | 20,443 |  |  | 11,531 |  |  | 18,350 |
Impact of intercompany charges and dividends(7) | 27,442 |  |  | 98,052 |  |  | 94,596 |
Reclassification of stranded tax effects in AOCI | (14,811 | ) |  | — |  |  | — |
Other, net | 14,636 |  |  | 18,037 |  |  | 23,055 |
Total income tax expense | $ | 285,860 |  |  | $ | 129,066 |  |  | $ | 132,149 |
(1) | The U.S. federal statutory income tax rate was 25.7%, 35% and 35% for fiscal years ended August 31, 2018, 2017 and 2016, respectively. As a result of the Tax Cuts and Jobs Act of 2017 ("Tax Act"), the Company will be subject to a blended U.S. federal tax rate of 25.7% for the fiscal year ended August 31, 2018 and a 21.0% U.S. federal tax rate for future fiscal years.
(2) | For the fiscal year ended August 31, 2018, the decrease in the impact of foreign tax rates was primarily due to a decrease in the U.S. federal statutory income tax rate from 35% to 25.7% due to the Tax Act.
(3) | For the fiscal year ended August 31, 2018, the increase in the changes in tax rates on deferred tax assets and liabilities was primarily due to the Tax Act. This increase excludes the impact of the enacted rate change on the U.S. valuation allowance.
(4) | The Tax Act introduced a one-time mandatory income inclusion of the historically untaxed foreign earnings of a U.S. company's foreign subsidiaries and will effectively tax such income at reduced tax rates ("transition tax"). For the fiscal year ended August 31, 2018, the transition tax related to the Tax Act reflects the $65.9 million provisional one-time transition tax inclusive of unrecognized tax benefits and the corresponding utilization of U.S. federal net operating losses and tax credits that historically had valuation allowances.
(5) | For the fiscal year ended August 31, 2018, the change in indefinite reinvestment assertion related to the Tax Act reflects the $85.0 million of foreign taxes that would be incurred upon future remittances of certain foreign earnings less the write off of a previously recorded U.S. deferred tax liability that is no longer taxable due to the Tax Act.
(6) | For the fiscal year ended August 31, 2018, the valuation allowance decrease was due to utilization of U.S. federal net operating losses and tax credits against the one-time transition tax and the change in enacted tax rate applied to U.S. deferred tax assets and liabilities. The tax benefit from the valuation allowance reversal on U.S. federal net operating losses utilized in the one-time transition tax was $85.0 million. The valuation allowance decrease is partially offset by the current year increase of deferred tax assets in sites with existing valuation allowances.
(7) | For the fiscal year ended August 31, 2018, the decrease in the impact of intercompany charges and dividends was due to a change in the U.S. taxation of foreign dividends as a result of the Tax Act.
Deferred Tax Assets and Liabilities | The significant components of the deferred tax assets and liabilities are summarized below (in thousands):
| Fiscal Year Ended August 31,
| 2018 |  | 2017
Deferred tax assets: |  |  |
Net operating loss carry forward | $ | 119,259 |  |  | $ | 268,853 |
Receivables | 7,111 |  |  | 7,497 |
Inventories | 7,634 |  |  | 11,618 |
Compensated absences | 8,266 |  |  | 10,981 |
Accrued expenses | 81,912 |  |  | 93,413 |
Property, plant and equipment, principally due to differences in depreciation and amortization | 97,420 |  |  | 81,954 |
U.S. federal and state tax credits | 70,153 |  |  | 57,122 |
Foreign jurisdiction tax credits | 25,887 |  |  | 24,641 |
Equity compensation – U.S. | 7,566 |  |  | 16,460 |
Equity compensation – Non-U.S. | 2,401 |  |  | 2,700 |
Other | 18,176 |  |  | 14,573 |
Total deferred tax assets before valuation allowances | 445,785 |  |  | 589,812 |
Less valuation allowances | (223,487 | ) |  | (285,559 | )
Net deferred tax assets | $ | 222,298 |  |  | $ | 304,253 |
Deferred tax liabilities: |  |  |
Unremitted earnings of non-U.S. subsidiaries | 74,654 |  |  | 86,202 |
Intangible assets | 39,122 |  |  | 48,229 |
Cash flow hedges | — |  |  | 8,564 |
Other | 4,655 |  |  | 4,863 |
Total deferred tax liabilities | $ | 118,431 |  |  | $ | 147,858 |
Net deferred tax assets | $ | 103,867 |  |  | $ | 156,395 |
Reconciliations of Unrecognized Tax Benefits | Reconciliations of the unrecognized tax benefits are summarized below (in thousands):
| Fiscal Year Ended August 31,
| 2018 |  | 2017 |  | 2016
Beginning balance | $ | 201,355 |  |  | $ | 149,898 |  |  | $ | 154,648 |
Additions for tax positions of prior years | 14,465 |  |  | 2,155 |  |  | 7,974 |
Reductions for tax positions of prior years | (21,045 | ) |  | (12,233 | ) |  | (20,045 | )
Additions for tax positions related to current year | 81,866 |  |  | 77,807 |  |  | 25,892 |
Cash settlements | (1,659 | ) |  | (2,298 | ) |  | (6,553 | )
Reductions from lapses in statutes of limitations | (7,496 | ) |  | (10,446 | ) |  | (7,099 | )
Reductions from settlements with taxing authorities | (5,928 | ) |  | (6,061 | ) |  | (1,787 | )
Foreign exchange rate adjustment | (4,853 | ) |  | 2,533 |  |  | (3,132 | )
Ending balance | $ | 256,705 |  |  | $ | 201,355 |  |  | $ | 149,898 |
Unrecognized tax benefits that would affect the effective tax rate (if recognized) | $ | 117,455 |  |  | $ | 75,223 |  |  | $ | 72,152 |

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