Fair Value Measurements

3 Months Ended

Nov. 30, 2023

Fair Value Measurements on a Recurring Basis

The following table presents the fair value of the Company's financial assets and liabilities measured at fair value by hierarchy level on a recurring basis as of the periods indicated (in millions):


	Fair Value Hierarchy		November 30, 2023		August 31, 2023
Assets:


Prepaid expenses and other current assets:
Short-term investments	Level 1		$	25	$	25
Forward foreign exchange contracts:
Derivatives designated as hedging instruments (Note 8)	Level 2	(1)	10		4
Derivatives not designated as hedging instruments (Note 8)	Level 2	(1)	18		20
Net investment hedges:
Derivatives designated as hedging instruments (Note 8)	Level 2	(1)	5		9




Liabilities:
Accrued expenses:
Forward foreign exchange contracts:
Derivatives designated as hedging instruments (Note 8)	Level 2	(1)	$	5	$	17
Derivatives not designated as hedging instruments (Note 8)	Level 2	(1)	17		64
Net investment hedges:
Derivatives designated as hedging instruments (Note 8)	Level 2	(1)	3		1

(1)The Company’s forward foreign exchange contracts, including cash flow hedges and net investment hedges are measured on a recurring basis at fair value, based on foreign currency spot rates and forward rates quoted by banks or foreign currency dealers.

Fair Value of Financial Instruments

The carrying amounts of cash and cash equivalents, trade accounts receivable, prepaid expenses and other current assets, accounts payable and accrued expenses approximate fair value because of the short-term nature of these financial instruments. The carrying amounts of borrowings under credit facilities and under loans approximates fair value as interest rates on these instruments approximates current market rates.

Notes payable and long-term debt is carried at amortized cost; however, the Company estimates the fair values of notes payable and long-term debt for disclosure purposes. The following table presents the carrying amounts and fair values of the Company's notes payable and long-term debt, by hierarchy level as of the periods indicated (in millions):



			November 30, 2023				August 31, 2023
	Fair Value Hierarchy		Carrying Amount		Fair Value		Carrying Amount		Fair Value
Notes payable and long-term debt: (Note 4)

3.950% Senior Notes	Level 2	(1)	$	497	$	469	$	497	$	468
3.600% Senior Notes	Level 2	(1)	$	497	$	444	$	496	$	448
3.000% Senior Notes	Level 2	(1)	$	593	$	505	$	593	$	502
1.700% Senior Notes	Level 2	(1)	$	498	$	459	$	498	$	452
4.250% Senior Notes	Level 2	(1)	$	495	$	481	$	495	$	478
5.450% Senior Notes	Level 2	(1)	$	296	$	298	$	296	$	297

(1)The fair value estimates are based upon observable market data.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

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