INCOME TAXES (Tables)

12 Months Ended

Aug. 31, 2013

Income Tax Disclosure [Abstract]

Current and Deferred Income Taxes by Period

	Fiscal
	2013			2012			2011
Current taxes
U.S. federal(1)	$	155,090		$	118,498		$	334,400
U.S. state and local(1)	3,425			16,754			46,878
Non-U.S.	835,934			887,008			747,762
Total current tax expense	994,449			1,022,260			1,129,040
Deferred taxes
U.S. federal(1)	(12,912		)	161,093			(8,229		)
U.S. state and local(1)	795			27,362			(1,140		)
Non-U.S.	(197,557		)	(131,474		)	(160,889		)
Total deferred tax (benefit) expense	(209,674		)	56,981			(170,258		)
Total	$	784,775		$	1,079,241		$	958,782

_______________ 

(1) The fiscal 2012 U.S. federal and U.S. state and local current and deferred tax expense reflects the impact of a discretionary cash contribution of $500,000 made to the Company's U.S. defined benefit pension plan during fiscal 2013.

Components of Income Before Income Taxes

The components of Income before income taxes were as follows:

	Fiscal
	2013		2012		2011
U.S. sources	$	1,043,810	$	748,177	$	719,315
Non-U.S. sources	3,295,484		3,155,997		2,792,707
Total	$	4,339,294	$	3,904,174	$	3,512,022

Reconciliation of the U.S. Federal Statutory Income Tax Rate to Effective Tax Rate

The reconciliation of the U.S. federal statutory income tax rate to the Company’s effective income tax rate was as follows:

	Fiscal
	2013		2012		2011
U.S. federal statutory income tax rate	35.0	%	35.0	%	35.0	%
U.S. state and local taxes, net	1.1		1.0		0.9
Non-U.S. operations taxed at lower rates	(13.1	)	(13.7	)	(14.6	)
Reorganization final determinations (1)	(2.2	)	—		—
Other final determinations (1)	(8.2	)	(8.6	)	(0.6	)
Other net activity in unrecognized tax benefits	3.8		9.4		4.8
Other, net	1.7		4.5		1.8
Effective income tax rate	18.1	%	27.6	%	27.3	%

_______________ 

(1) Final determinations include final agreements with tax authorities and expirations of statutes of limitations.

Components of Deferred Tax Assets And Liabilities

The components of the Company’s deferred tax assets and liabilities included the following:

	August 31,
	2013			2012
Deferred tax assets
Pensions	$	127,515		$	165,216
Revenue recognition	97,361			89,420
Compensation and benefits	498,035			440,768
Share-based compensation	217,990			239,326
Tax credit carryforwards	94,417			137,904
Net operating loss carryforwards	197,691			176,649
Depreciation and amortization	46,185			55,182
Deferred amortization deductions	393,392			244,103
Indirect effects of unrecognized tax benefits	357,093			316,776
Derivatives	120,229			11,482
Other	99,182			94,308
	2,249,090			1,971,134
Valuation allowance	(204,561		)	(221,015		)
Total deferred tax assets	2,044,529			1,750,119
Deferred tax liabilities
Revenue recognition	(71,907		)	(56,429		)
Depreciation and amortization	(128,106		)	(96,833		)
Investments in subsidiaries	(159,910		)	(174,943		)
Other	(69,971		)	(54,877		)
Total deferred tax liabilities	(429,894		)	(383,082		)
Net deferred tax assets	$	1,614,635		$	1,367,037

Reconciliation of Unrecognized Tax Benefits

A reconciliation of the beginning and ending amounts of unrecognized tax benefits was as follows:

	Fiscal
	2013			2012
Balance, at beginning of period	$	1,604,745		$	1,645,831
Additions for tax positions related to the current year	171,133			271,305
Additions for tax positions related to prior years	124,372			328,210
Reductions for tax positions related to prior years	(533,570		)	(458,767		)
Statute of limitations expirations	(67,891		)	(26,766		)
Settlements with tax authorities	(36,218		)	(112,520		)
Cumulative foreign currency translation	499			(42,548		)
Balance, at end of period	$	1,263,070		$	1,604,745