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INCOME TAX | 9 Months Ended
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May 31, 2016
Income Tax Disclosure [Abstract] |
Income tax | NOTE 11. INCOME TAX The Company's effective income tax rate from continuing operations for the three and nine months ended May 31, 2016 was 23.3% and 25.5%, respectively, compared with 36.1% and 31.6% for the three and nine months ended May 31, 2015, respectively. The effective tax rate is determined by computing the estimated annual effective tax rate, adjusted for discrete items, if any, which are taken into account in the appropriate period. Several factors determine the Company's effective tax rate, including the mix and amount of global earnings, the impact of loss companies for which no tax benefit is available due to valuation allowances, audit related adjustments, and the impact of permanent tax adjustments. For the three months ended May 31, 2016, the tax rate was lower than the statutory income tax rate of 35%, in part due to income from operations earned in jurisdictions with lower statutory tax rates than the United States and a benefit under Section 199 of the Internal Revenue Code related to domestic production activity income. Discrete items recorded during the three months ended May 31, 2016 that impact the tax rate include (1) a benefit for a non-taxable gain on assets related to the Company's non-qualified benefit restoration plan and (2) a benefit associated with passage of the Protecting Americans from Tax Hikes Act of 2015 recognized upon filing of the Company's fiscal year 2015 U.S. federal tax return. For the nine months ended May 31, 2016, the tax rate was lower than the statutory income tax rate of 35% because the Company had income from operations in countries which have lower tax rates than the United States, a tax benefit under Section 199 of the Internal Revenue Code related to domestic production activity income, and discrete items benefiting the rate disclosed above and in prior periods, including favorable adjustments recognized during the second quarter of fiscal 2016 related to our current IRS exam. The Company's effective income tax rate from discontinued operations for the three and nine months ended May 31, 2016 was 0.0% and 0.6%, respectively, compared with 3.9% and 2.2% for the three and nine months ended May 31, 2015, respectively. The Company's effective income tax rate from discontinued operations for the three and nine months ended May 31, 2016 reflected the fact that earnings from discontinued operations before income taxes included a loss in Australia, a jurisdiction in which all tax losses created a deferred tax asset that was subject to a full valuation allowance, and thus no tax benefit is recorded. The tax benefit related to discontinued operations was the result of nominal pre-tax losses from discontinued operations which are subject to U.S. tax. The Company made net payments of $36.0 million and $46.7 million for income taxes during the nine months ended May 31, 2016 and 2015, respectively. As of May 31, 2016 and August 31, 2015, the reserve for unrecognized income tax benefits related to the accounting for uncertainty in income taxes was $17.8 million and $27.3 million, respectively, exclusive of interest and penalties. The Company's policy classifies interest recognized on an underpayment of income taxes and any statutory penalties recognized on a tax position as income tax expense, and the balances at the end of a reporting period are recorded as part of the current or noncurrent reserve for uncertain income tax positions. For the three and nine months ended May 31, 2016, before any income tax benefits, the Company recorded immaterial amounts of accrued interest and penalties on unrecognized income tax benefits. During the twelve months ending May 31, 2017, it is reasonably possible that the statute of limitations pertaining to positions taken by the Company in prior year income tax returns may lapse or that income tax audits in various taxing jurisdictions could be finalized. As a result, the total amount of unrecognized income tax benefits may decrease by approximately $8.3 million, which would reduce the provision for income taxes by $2.5 million. The Company files income tax returns in the United States and multiple foreign jurisdictions with varying statutes of limitations. In the normal course of business, CMC and its subsidiaries are subject to examination by various taxing authorities. The following is a summary of tax years subject to examination: U.S. Federal — 2009 and forward U.S. States — 2009 and forward Foreign — 2009 and forward The Company is currently under examination by the Internal Revenue Service and state revenue authorities from 2009 to 2011. Management believes the Company's recorded tax liabilities as of May 31, 2016 sufficiently reflect the anticipated outcome of these examinations.

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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 235 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08.(h)) -URI http://asc.fasb.org/extlink&oid=26873400&loc=d3e23780-122690 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=65882285&loc=d3e32559-109319 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 15 -URI http://asc.fasb.org/extlink&oid=65882285&loc=d3e32718-109319 Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 9 -URI http://asc.fasb.org/extlink&oid=65882285&loc=d3e32639-109319 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -SubTopic 10 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=65882285&loc=d3e32537-109319 + Details
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