What changed in this filing

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Item 9A. Controls and Procedures

2021-10-22 compared with 2020-10-22 · 270 added, 352 removed, 1196 unchanged (34% of the section changed)

17 unchanged sentences

Notwithstanding the foregoing limitations on the effectiveness of controls, we have reached the conclusions set forth in Management’s report on internal control over financial reporting as of August 31, 2021.

The SEC’s general guidance permits the exclusion of an assessment of the effectiveness of a registrant’s controls and procedures as they relate to its internal control over financial reporting for an acquired business during the first year following such acquisition if, among other circumstances and factors, there is not an adequate amount of time between the acquisition date and the date of assessment.

On September 30, 2019, we completed the third closing of our acquisition of certain assets of Johnson & Johnson Medical Devices Companies (“JJMD”).

In accordance with the SEC guidance, the scope of our evaluation of internal controls over financial reporting as of August 31, 2020 did not include the internal control over financial reporting of these acquired operations.

Assets acquired from JJMD during the third closing represent 2.1% of our total consolidated assets at August 31, 2020 .

Net revenue generated by these assets subsequent to the date of acquisition represents 1.9% of our consolidated net revenue for the fiscal year ended August 31, 2020 .

We continue to evaluate internal controls over financial reporting for these acquired operations.

From the acquisition date to August 31, 2020 , the processes and systems of the acquired operations did not significantly impact our internal control over financial reporting.

13 unchanged sentences

Exhibits and Financial Statement Schedules

The following documents are filed as part of this Report:

(a) The following documents are filed as part of this Report:

Financial Statements.

5 unchanged sentences

See Item 15(b) below.

(b) Exhibits .

The following exhibits are included as part of, or incorporated by reference into, this Report.

4 unchanged sentences

Form of Certificate for Shares of the Registrant’s Common Stock.

Indenture, dated January 16, 2008, with respect to Senior Debt Securities of the Registrant, between the Registrant and The Bank of New York Mellon Trust Company, N.A.

Indenture, dated January 16, 2008, with respect to Senior Debt Securities of the Registrant, between the Registrant and U.S.

Bank National Association (as successor in interest to The Bank of New York Mellon Trust Company, N.A.

(formerly known as The Bank of New York Trust) Company, N.A.), as trustee.

4 unchanged sentences

Officers’ Certificate, dated as of July 13, 2020, establishing the 3.000% Senior Notes due 2031.

Officers’ Certificate, dated as of April 14, 2021, establishing the 1.700% Senior Notes due 2026 .

Description of Jabil Securities.

1 unchanged sentence

Form of Indemnification Agreement between the Registrant and its Officers and Directors.

Jabil 2011 Stock Award and Incentive Plan, as Amended and Restated.

Form of Performance-Based Restricted Stock Unit Award Agreement (PBRSU EPS Officer - EU5).

Form of Performance-Based Restricted Stock Unit Award Agreement (PBRSU EPS Officer - Non-EU5).

Form of Performance-Based Restricted Stock Unit Award Agreement (PBRSU EPS Non-Officer5).

Form of Performance-Based Restricted Stock Unit Award Agreement (PBRSU TSR Officer - EU).

Form of Performance-Based Restricted Stock Unit Award Agreement (PBRSU TSR Officer - Non-EU).

Form of Time-Based Restricted Stock Unit Award Agreement (TBRSU DIR).

Form of Time-Based Restricted Stock Unit Award Agreement (TBRSU NON).

Form of Time-Based Restricted Stock Unit Award Agreement (TBRSU OEU).

Form of Time-Based Restricted Stock Unit Award Agreement (TBRSU ONEU).

Form of Time-Based Restricted Stock Unit Award Agreement (ACQ TBRSU).

Form of Stock Appreciation Right Award Agreement (SAR Officer - Non EU).

2011 Employee Stock Purchase Plan, as amended

Form of Jabil Inc.

26 unchanged sentences

Restricted Stock Unit Award Agreement (TBRSU-DIR).

2011 Employee Stock Purchase Plan, as amended.

2021 Equity Incentive Plan.

Form of Jabil Inc.

Restricted Stock Unit Award Agreement (TBRSU-Executive).

Form of Jabil Inc.

Restricted Stock Unit Award Agreement (TBRSU-Non-Employee Director).

Form of Jabil Inc.

Restricted Stock Unit Award Agreement (PBRSU TSR – Executive).

Form of Jabil Inc.

Restricted Stock Unit Award Agreement (PBRSU EPS – Executive).

Form of Jabil Inc.

Two-Year Cliff Restricted Stock Unit Award Agreement (TBRSU – Executive).

Form of Jabil Inc.

Two-Year Restricted Stock Unit Award Agreement (PBRSU EPS-Executive).

Executive Deferred Compensation Plan.

Credit Agreement dated as of January 22, 2020 among Jabil Inc.;

the initial lenders named in the Agreement;

Amendment No.

1 to Credit Agreement dated as of April 28, 2021 among Jabil Inc.;

the lenders named therein;

Citibank, N.A., as administrative agent;

Sumitomo Mitsui Banking Corporation and Citibank, N.A., as sustainability agents;

JPMorgan Chase Bank, N.A.

and Bank of America, N.A., as co-syndication agents;

BNP Paribas, Mizuho Bank, Ltd., MUFG Bank, Ltd.

and Sumitomo Mitsui Banking Corporation, as documentation agents;

and Citibank, N.A., JPMorgan Chase Bank, N.A., BofA Securities, Inc., BNP Paribas Securities Corp., Mizuho Bank, Ltd., MUFG Bank, Ltd., and Sumitomo Mitsui BankingCorporation, as joint lead arrangers and joint bookrunners.

Credit Agreement dated as of April 24, 2020 among Jabil Inc.;

the initial lenders named in the Credit Agreement;

Mizuho Bank, Ltd.

(“Mizuho”), as administrative agent;

BNP Paribas and Sumitomo Mitsui Banking Corporation (“SMBC”), as co-syndication agents;

Credit Agricole Corporate and Investment Bank, MUFG Union Bank, N.A.

BNP Paribas, Mizuho Bank, Ltd., MUFG Bank, Ltd., Sumitomo Mitsui Banking Corporation and U.S.

Bank National Association, as documentation agents;

and Mizuho, BNP Paribas Securities Corp.

and SMBC as joint lead arrangers and joint bookrunners.

and Citibank, N.A., JPMorgan Chase Bank, N.A., BofA Securities, Inc., BNP Paribas Securities Corp., Mizuho Bank, Ltd., MUFG Bank, Ltd., Sumitomo Mitsui Banking Corporation and U.S.

Bank National Association, as joint lead arrangers and joint bookrunners .

List of Subsidiaries.

12 unchanged sentences

and (vi) Notes to Consolidated Financial Statements.

Cover Page Interactive Data File - Embedded within the inline XBRL Document.

Cover Page Interactive Data File (Embedded within the inline XBRL Document in Exhibit 101).

Indicates management compensatory plan, contract of arrangement.

2 unchanged sentences

The Company agrees to furnish a copy of any such instrument to the SEC upon request.

Financial Statement Schedules.

See Item 15(a) above.

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Management’s assessment included an evaluation of the design of the Company’s internal control over financial reporting and testing of the effectiveness of its internal control over financial reporting.

On September 30, 2019, we completed the third closing of our acquisition of certain assets of Johnson & Johnson Medical Devices Companies (“JJMD”).

Assets acquired from JJMD during the third closing represent 2.1% of our total consolidated assets at August 31, 2020.

Net revenue generated by these assets subsequent to the date of acquisition represents 1.9% of our

consolidated net revenue for the fiscal year ended August 31, 2020.

We continue to evaluate internal controls over financial reporting for these acquired operations.

From the acquisition date to August 31, 2020, the processes and systems of the acquired operations did not significantly impact our internal control over financial reporting.

Based on this assessment, management has concluded that, as of August 31, 2021, the Company maintained effective internal control over financial reporting.

2 unchanged sentences

Report of Independent Registered Public Accounting Firm

To the Board of Directors and Stockholders of Jabil Inc.

To the Stockholders and Board of Directors of Jabil Inc.

Opinion on Internal Control Over Financial Reporting

3 unchanged sentences

and subsidiaries (the Company) maintained, in all material respects, effective internal control over financial reporting as of August 31, 2021, based on the COSO criteria.

As indicated in the accompanying Management’s Report on Internal Control over Financial Reporting, management’s assessment of and conclusion on the effectiveness of internal control over financial reporting did not include the internal controls of the operations acquired in the third closing of the Company’s acquisition of certain assets of Johnson & Johnson Medical Devices Companies (JJMD), which are included in the 2020 consolidated financial statements of the Company and constituted 2.1% of consolidated total assets as of August 31, 2020 and 1.9% of consolidated net revenue for the year then ended.

Our audit of internal control over financial reporting of the Company also did not include an evaluation of the internal control over financial reporting of the operations acquired in the third closing of the Company’s acquisition of certain assets of JJMD.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of August 31, 2021 and 2020, and the related consolidated statements of operations, comprehensive income, stockholders’ equity and cash flows for each of the three years in the period ended August 31, 2021, and the related notes and financial statement schedule listed in the Index at Item 15(a), and our report dated October 22, 2021 expressed an unqualified opinion thereon.

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Report of Independent Registered Public Accounting Firm

To the Board of Directors and Stockholders of Jabil Inc.

To the Stockholders and Board of Directors of Jabil Inc.

Opinion on the Financial Statements

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We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of August 31, 2021, based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework), and our report dated October 22, 2021 expressed an unqualified opinion thereon.

Adoption of New Accounting Standard

As discussed in Note 13 to the consolidated financial statements, the Company changed its method of accounting for revenue from contracts with customers and certain fulfillment costs in 2019 due to the adoption of ASU No.

2014-09, Revenue from Contracts with Customers (Topic 606) .

Basis for Opinion

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CONSOLIDATED BALANCE SHEETS

(in thousands, except for share data)

(in millions, except for share data)

August 31, 2021

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CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except for per share data)

(in millions, except for per share data)

Fiscal Year Ended August 31,

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Operating income

Loss on securities

Other expense

(Gain) loss on securities

Other (income) expense

Interest income

9 unchanged sentences

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(in thousands)

(in millions)

Fiscal Year Ended August 31,

Other comprehensive (loss) income:

Other comprehensive income (loss):

Change in foreign currency translation

1 unchanged sentence

Change in fair value of derivatives

Adjustment for net losses (gains) realized and included in net income

Adjustment for net (gains) losses realized and included in net income

Total change in derivative instruments

Change in available for sale securities:

Unrealized (loss) gain on available for sale securities

Unrealized loss on available for sale securities

Adjustment for net losses realized and included in net income

1 unchanged sentence

Actuarial gain (loss)

Prior service (cost) credit

Prior service cost

Total other comprehensive income (loss)

5 unchanged sentences

CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

(in thousands, except for share data)

(in millions)

Fiscal Year Ended August 31,

1 unchanged sentence

Common stock:

Beginning balances

Shares issued under employee stock purchase plan

Vesting of restricted stock

Ending balances

Additional paid-in capital:

1 unchanged sentence

Shares issued under employee stock purchase plan

Vesting of restricted stock

Purchase of noncontrolling interest

Recognition of stock-based compensation

18 unchanged sentences

Net income attributable to noncontrolling interests

Acquisition of noncontrolling interests

(Purchase) or acquisition of noncontrolling interests

Disposition of noncontrolling interests

Declared dividends to noncontrolling interests

Foreign currency adjustments attributable to noncontrolling interests

Ending balances

3 unchanged sentences

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

(in millions)

Fiscal Year Ended August 31,

Cash flows provided by (used in) operating activities:

Adjustments to reconcile net income to net cash provided by (used in) operating activities:

Cash flows provided by operating activities:

Adjustments to reconcile net income to net cash provided by operating activities:

Depreciation and amortization

4 unchanged sentences

Provision for allowance for doubtful accounts and notes receivable

Loss on securities

(Gain) loss on securities

Change in operating assets and liabilities, exclusive of net assets acquired:

3 unchanged sentences

Accounts payable, accrued expenses and other liabilities

Net cash provided by (used in) operating activities

Cash flows (used in) provided by investing activities:

Net cash provided by operating activities

Cash flows used in investing activities:

Acquisition of property, plant and equipment

1 unchanged sentence

Cash paid for business and intangible asset acquisitions, net of cash

Repurchase of sold receivables

Cash receipts on repurchased receivables

Cash receipts on sold receivables

Net cash (used in) provided by investing activities

Net cash used in investing activities

Cash flows used in financing activities:

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Accounts receivable consist of trade receivables and other miscellaneous receivables.

The Company maintains an allowance for doubtful accounts for estimated losses resulting from the inability of its customers to make required payments.

The Company maintains an allowance for doubtful accounts based on historical losses, the age of past due receivables, credit quality of our customers, current economic conditions, and other factors that may affect our ability to collect from customers.

Bad debts are charged to this allowance after all attempts to collect the balance are exhausted.

Allowances of $ 25.8 million and $ 17.2 million were recorded as of August 31, 2020 and 2019 , respectively.

As the financial condition and circumstances of the Company’s customers change, adjustments to the allowance for doubtful accounts are made as necessary.

4 unchanged sentences

Contract assets are classified separately on the Consolidated Balance Sheets and transferred to receivables when right to payment becomes unconditional.

The Company reviews contract assets for impairment whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable after considering factors such as the age of the balances and the financial stability of the customer.

The Company maintains an allowance for credit losses related to contract assets based on historical losses, credit quality of our customers, current economic conditions, and other factors that may affect our ability to collect from our customers.

Inventories are stated at the lower of cost (on a first in, first out (FIFO) basis) and net realizable value.

9 unchanged sentences

As of August 31, 2021 and 2020, capitalized costs to fulfill were $ 133 million and $ 85 million, respectively.

Amortization of fulfillment cost were $ 56.6 million and $ 48.6 million during the fiscal years ended August 31, 2020 and 2019, respectively.

Immaterial or no impairments for fulfillments costs were recognized during the fiscal years ended August 31, 2020 and 2019, respectively.

Amortization of fulfillment costs were $ 58 million, $ 57 million and $ 49 million during the fiscal years ended August 31, 2021, 2020 and 2019, respectively.

Immaterial or no impairments for fulfillment costs were recognized during the fiscal years ended August 31, 2021, 2020 and 2019, respectively.

Property, Plant and Equipment, net

12 unchanged sentences

The cost and related accumulated depreciation of assets sold or retired is removed from the accounts and any resulting gain or loss is reflected in the Consolidated Statements of Operations as a component of operating income.

Effective September 1, 2019, the Company’s lease accounting policies changed in conjunction with the adoption of Accounting Standards Update No.

2016-02 (“ASU 2016-02”), Leases (Topic 842).

For further discussion, refer to Note 5 —“Leases” to the Consolidated Financial Statements.

The Company elected to apply the package of practical expedients, which among other things, allows entities to maintain the historical lease classification for existing leases.

Following the adoption of Accounting Standards Update No.

2016-02 (“ASU 2016-02”), Leases (Topic 842) on September 1, 2019, the Company elected to apply the package of practical expedients, which among other things, allows entities to maintain the historical lease classification for existing leases.

The Company has lease agreements that contain both lease and non-lease components.

For lease agreements entered into or reassessed after the adoption of ASU 2016-02, the Company has elected the practical expedient to combine lease and non-lease components for building and real estate leases.

The Company primarily has leases for buildings and real estate with lease terms ranging from 1 year to 36 years .

The Company primarily has leases for buildings, real estate, machinery and equipment with lease terms ranging from 1 year to 35 years.

Leases for other classes of assets are not significant.

2 unchanged sentences

These options are included in the lease term when it is reasonably certain that the Company will exercise that option.

Generally, the Company's lease agreements do not contain material residual value guarantees or material restrictive covenants.

Generally, the Company’s lease agreements do not contain material restrictive covenants.

Right-of-use assets represent the right to use an underlying asset for the lease term and lease liabilities represent an obligation to make lease payments arising from the lease.

13 unchanged sentences

If the qualitative assessment is not performed or if the Company determines that it is not more likely than not that the fair value of the reporting unit exceeds the carrying value, the Company determines the fair value of its reporting units based on an average weighting of both projected discounted future results and the use of comparative market multiples.

If the carrying amount of the reporting unit exceeds its fair value, goodwill is considered impaired and a second step is performed to measure the amount of loss, if any.

If the carrying amount of the reporting unit exceeds its fair value, goodwill is considered impaired and a loss recognized in the amount equal to that excess.

The recoverability of indefinite-lived intangible assets is measured by comparing the carrying amount to the fair value.

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Accumulated Other Comprehensive Income

The following table sets forth the changes in AOCI, net of tax, by component during the fiscal year ended August 31, 2020 (in thousands):

The following table sets forth the changes in AOCI, net of tax, by component during the fiscal year ended August 31, 2021 (in millions):

Service (Cost) Credit

Balance as of August 31, 2020

Other comprehensive (loss) income before reclassifications

Other comprehensive income (loss) before reclassifications

Amounts reclassified from AOCI

Other comprehensive (loss) income (1)

Other comprehensive income (loss) (1)

Balance as of August 31, 2021

Actuarial (loss) gain is net of tax of $( 12.0 ) million .

Amounts for other components of AOCI are net of tax, which are immaterial.

The following table sets forth the amounts reclassified from AOCI into the Consolidated Statements of Operations, and the associated financial statement line item, net of tax, for the periods indicated (in thousands):

(1) Amounts are net of tax, which are immaterial.

Fiscal Year Ended August 31,

1 unchanged sentence

Financial Statement Line Item

Realized losses (gains) on derivative instruments:

Realized (gains) losses on derivative instruments:

Foreign exchange contracts

3 unchanged sentences

Actuarial (gain) loss

Prior service credit

Prior service cost

Available for sale securities

Loss on securities

(Gain) loss on securities

Total amounts reclassified from AOCI (3)

3 unchanged sentences

(3) Amounts are net of tax, which are immaterial for the fiscal years ended August 31, 2021, 2020 and 2019.

The amount for the fiscal year ended August 31, 2018 includes a reduction to income tax expense related to derivative instruments of $ 14.8 million .

Foreign Currency Transactions

10 unchanged sentences

As a result, revenue is recognized over time when or as the Company transfers control of the promised products or services (known as performance obligations) to its customers.

For certain other contracts with customers that do not meet the over time revenue recognition criteria, transfer of control occurs at a point in time which generally occurs upon delivery and transfer of risk and title to the customer.

For certain other contracts with customers that do not meet the over time revenue

recognition criteria, transfer of control occurs at a point in time which generally occurs upon delivery and transfer of risk and title to the customer.

Most of the Company's contracts have a single performance obligation as the promise to transfer the individual manufactured product or service is capable of being distinct and is distinct within the context of the contract.

22 unchanged sentences

See Note 12 – “Stockholders’ Equity” for further discussion of stock-based compensation expense.

Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis.

Deferred tax assets (“DTA”) and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis.

Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled.

The effect on deferred tax assets and liabilities of a change in the tax rate is recognized in income in the period that includes the enactment date of the rate change.

The effect on deferred tax assets and liabilities of a change in the

tax rate is recognized in income in the period that includes the enactment date of the rate change.

The Company records a valuation allowance to reduce its deferred tax assets to the amount that is more likely than not to be realized.

The Company considers future taxable income and ongoing feasible tax planning strategies in assessing the need for the valuation allowance.

The Company applies the incremental cash tax savings approach when analyzing the impact Global Intangible Low-Taxed Income (“GILTI”) could have on its U.S.

The Company records the effects of the Global Intangible Low-Taxed Income (“GILTI”) as a period cost and applies the incremental cash tax savings approach when analyzing the impact GILTI could have on its U.S.

valuation allowance.

23 unchanged sentences

Transfers of the receivables under the trade accounts receivable sale programs are accounted for as sales and, accordingly, net receivables sold under the trade accounts receivable sale programs are excluded from accounts receivable on the Consolidated Balance Sheets and are reflected as cash provided by operating activities on the Consolidated Statements of Cash Flows.

The following is a summary of the trade accounts receivable sale programs with unaffiliated financial institutions where the Company may elect to sell receivables and the unaffiliated financial institution may elect to purchase, at a discount, on an ongoing basis:

ongoing basis:

(in millions) (1)

9 unchanged sentences

December 5, 2021

January 23, 2022

(1) Maximum amount of trade accounts receivable that may be sold under a facility at any one time.

(2) The program will be automatically extended through December 5, 2025 unless either party provides 30 days notice of termination.

The program will automatically extend for one year at each expiration date unless either party provides 10 days ’ notice of termination.

(3) Any party may elect to terminate the agreement upon 30 days prior notice.

4 unchanged sentences

(8) The program will be automatically extended through December 5, 2024 unless either party provides 30 days notice of termination.

The program will be automatically extended each year through April 11, 2025 unless either party provides 30 days ’ notice of termination.

(9) The program will be automatically extended through April 11, 2025 unless either party provides 30 days notice of termination.

In connection with the trade accounts receivable sale programs, the Company recognized the following (in millions):

4 unchanged sentences

(1) Recorded to other expense within the Consolidated Statements of Operations.

Inventories consist of the following (in thousands):

Inventories consist of the following (in millions):

August 31, 2021

6 unchanged sentences

Property, Plant and Equipment

Property, plant and equipment consists of the following (in thousands):

Property, plant and equipment consists of the following (in millions):

August 31, 2021

8 unchanged sentences

Less accumulated depreciation and amortization

Depreciation and maintenance and repair expenses were as follows for the periods indicated (in thousands):

Depreciation and maintenance and repair expenses were as follows for the periods indicated (in millions):

Fiscal Year Ended August 31,

2 unchanged sentences

As of August 31, 2021 and 2020, the Company had $ 703 million and $ 422 million, respectively, included in accounts payable for the acquisition of property, plant and equipment, which is considered a non-cash investing activity in the Consolidated Statements of Cash Flows.

Effective September 1, 2019, the Company adopted Accounting Standards Update No.

2016-02 (“ASU 2016-02”), Leases (Topic 842) using the modified retrospective approach and also elected to apply the package of practical expedients, which among other things, allows entities to maintain the historical lease classification for existing leases.

The Company has lease agreements that contain both lease and non-lease components.

Upon adoption of ASU 2016-02, the Company recorded $ 414.6 million and $ 437.5 million of right-of-use assets and lease liabilities, respectively, related to its existing operating lease portfolio.

The accounting for the Company's finance leases remained substantially unchanged and balances were not significant on the adoption date.

The adoption of this standard did not have a material impact on the Consolidated Statements of Operations or the Consolidated Statements of Cash Flows.

The following table sets forth the amount of lease assets and lease liabilities included on the Company's Consolidated Balance Sheets, as of the period indicated (in thousands):

The following table sets forth the amount of lease assets and lease liabilities included on the Company's Consolidated Balance Sheets, as of the periods indicated (in millions):

Financial Statement Line Item

August 31, 2021

August 31, 2020

Operating lease assets (1)

12 unchanged sentences

Total lease liabilities

Net of accumulated amortization of $ 96.2 million .

Net of accumulated amortization of $ 12.8 million .

The following table is a summary of expenses related to leases included on the Company's Consolidated Statements of Operations, for the periods indicated (in thousands):

(1) Net of accumulated amortization of $ 165 million and $ 96 million as of August 31, 2021 and 2020, respectively.

(2) Net of accumulated amortization of $ 41 million and $ 13 million as of August 31, 2021 and 2020, respectively.

The following table is a summary of expenses related to leases included on the Company's Consolidated Statements of Operations, for the periods indicated (in millions):

Fiscal Year Ended August 31,

5 unchanged sentences

(1) Lease costs are primarily recognized in cost of revenue.

The following table is a summary of the weighted-average remaining lease terms and weighted-average discount rates of the Company's leases, as of the period indicated:

The following table is a summary of the weighted-average remaining lease terms and weighted-average discount rates of the Company's leases, as of the periods indicated:

August 31, 2021

August 31, 2020

Weighted-average remaining lease term

Weighted-average discount rate

Weighted-average remaining lease term

Weighted-average discount rate

Operating leases

Finance leases

The following table sets forth other supplemental information related to the Company's lease portfolio (in thousands):

The following table sets forth other supplemental information related to the Company's lease portfolio (in millions):

Fiscal Year Ended August 31,

8 unchanged sentences

(2) Included in payments toward debt agreements in Financing Activities of the Company's Consolidated Statements of Cash Flows.

The future minimum lease payments under operating and finance leases as of August 31, 2020 were as follows (in thousands):

The future minimum lease payments under operating and finance leases as of August 31, 2021 were as follows (in millions):

Fiscal Year Ending August 31,

5 unchanged sentences

Additionally, certain leases signed but not yet commenced contain residual value guarantees and purchase options not deemed probable.

As disclosed in the Company’s Form 10-K for the fiscal year ended August 31, 2019, the future minimum lease payments of non-cancelable operating leases prior to the adoption of ASU 2016-02 were as follows (in thousands):

Fiscal Year Ending August 31,

Total minimum lease payments

Total operating lease expense prior to the adoption of ASU 2016-02 was approximately $ 125.4 million and $ 130.2 million for fiscal years 2019 and 2018, respectively.

(2) As of August 31, 2021, the future minimum lease payments exclude $ 155 million of residual value guarantees that could potentially come due in future periods.

The Company does not believe it is probable that any amounts will be owed under these guarantees.

Therefore, no amounts related to the residual value guarantees are included in the lease payments used to measure the right-of-use assets and lease liabilities.

Goodwill and Other Intangible Assets

The Company completed its annual impairment test for goodwill and indefinite-lived intangible assets during the fourth quarter of fiscal year 2020 and determined the fair values of the reporting units and the indefinite-lived intangible assets were in excess of the carrying values and that no impairment existed as of the date of the impairment test.

The following table presents the changes in goodwill allocated to the Company’s reportable segments, Electronics Manufacturing Services (“EMS”) and Diversified Manufacturing Services (“DMS”), during the fiscal years ended August 31, 2020 and 2019 (in thousands):

The Company completed its annual impairment analysis for goodwill and indefinite-lived intangible assets during the fourth quarter of fiscal year 2021.

The qualitative assessment was performed and the Company determined that it is more likely than not that the fair values of the reporting units and the indefinite-lived intangible assets were in excess of the carrying values and that no impairment existed as of the date of the impairment analysis.

Balance as of August 31, 2019

Acquisitions and adjustments

Change in foreign currency exchange rates

3 unchanged sentences

Balance as of August 31, 2021

The following table is a summary of the Company’s gross goodwill balances and accumulated impairments as of the periods indicated (in thousands):

The following table is a summary of the Company’s gross goodwill balances and accumulated impairments as of the periods indicated (in millions):

August 31, 2021

August 31, 2020

The following table presents the Company’s total purchased intangible assets as of August 31, 2020 and 2019 (in thousands):

The following table presents the Company’s total purchased intangible assets as of August 31, 2021 and 2020 (in millions):

August 31, 2021

6 unchanged sentences

Intangible asset amortization for fiscal years 2021, 2020 and 2019 was approximately $ 47 million, $ 56 million and $ 32 million, respectively.

The estimated future amortization expense is as follows (in thousands):

The estimated future amortization expense is as follows (in millions):

Fiscal Year Ended August 31,

Notes Payable and Long-Term Debt

Notes payable and long-term debt outstanding as of August 31, 2020 and 2019 are summarized below (in thousands):

Notes payable and long-term debt outstanding as of August 31, 2021 and 2020 are summarized below (in millions):

Maturity Date

8 unchanged sentences

Borrowings under credit facilities (4)(5)

Apr 23, 2021, Jan 22, 2023 and Jan 22, 2025

Jan 22, 2024 and Jan 22, 2026

Borrowings under loans (3)

4 unchanged sentences

(2) The Senior Notes are the Company’s senior unsecured obligations and rank equally with all other existing and future senior unsecured debt obligations.

On January 15, 2020, the Company issued $ 500.0 million of publicly registered 3.600 % Senior Notes due 2030 (the “ 3.600 % Senior Notes”).

The net proceeds from the offering were used for the repayment of term loan indebtedness.

On July 13, 2020, the Company issued $ 600.0 million of publicly registered 3.000 % Senior Notes due 2031 (the “ 3.000 % Senior Notes”).

The net proceeds from the offering were used for general corporate purposes, including to redeem the $ 400.0 million aggregate principal amount of the Company’s 5.625 % Senior Notes due 2020 and pay the applicable “make-whole” premium.

On January 22, 2020, the Company entered into a senior unsecured credit agreement which provides for:

(i) a Revolving Credit Facility in the initial amount of $ 2.7 billion , of which $ 700.0 million expires on January 22, 2023 and $ 2.0 billion expires on January 22, 2025 and (ii) a $ 300.0 million Term Loan Facility which expires on January 22, 2025, (collectively the “Credit Facility”).

Interest and fees on the Credit Facility advances are based on the Company’s non-credit enhanced long-term senior unsecured debt rating as determined by Standard & Poor’s Ratings Service, Moody’s Investors Service and Fitch Ratings.

In connection with the Company’s entry into the Credit Facility, the Company terminated the Company’s amended and restated five-year credit agreement dated November 8, 2017 and the credit agreement dated August 24, 2018.

During the fiscal year ended August 31, 2020 , the interest rates on the Revolving Credit Facility ranged from 1.2 % to 4.3 % and the Term Loan Facility ranged from 1.6 % to 2.9 % .

Interest is charged at a rate equal to (a) for the Revolving Credit Facility, either 0.000 % to 0.450 % above the base rate or 0.975 % to 1.450 % above the Eurocurrency rate and (b) for the Term Loan Facility, either 0.125 % to 0.750 % above the base rate or 1.125 % to 1.750 % above the Eurocurrency rate.

The base rate represents the greatest of:

(i) Citibank, N.A.’s prime rate, (ii) 0.50 % above the federal funds rate, and (iii) 1.0 % above one-month LIBOR, but not less than zero.

The Eurocurrency rate represents adjusted LIBOR or adjusted CDOR, as applicable, for the applicable interest period, but not less than zero.

Fees include a facility fee based on the revolving credit commitments of the lenders and a letter of credit fee based on the amount of outstanding letters of credit.

Additionally, the Company’s foreign subsidiaries had various additional credit facilities that finance their future growth and any corresponding working capital needs.

On April 24, 2020, the Company entered into an unsecured 364 -day revolving credit agreement up to an initial aggregate amount of $ 375.0 million , which was increased to $ 425.0 million on May 29, 2020 (the “ 364 -Day Revolving Credit Agreement”).

The 364 -Day Revolving Credit Agreement expires on April 23, 2021.

Interest and fees on the 364 -Day Revolving Credit Agreement advances are based on the Company’s non-credit enhanced long-term senior unsecured debt rating as determined by Standard & Poor’s Ratings Service, Moody’s Investors Service and Fitch Ratings.

As of August 31, 2020 , no draws were made on the 364 -Day Revolving Credit Agreement.

Interest is charged at a rate equal to either (i) 0.450 % , 0.525 % or 0.800 % above the base rate or (ii) 1.450 % , 1.525 % or 1.800 % above the Eurodollar rate.

The base rate represents the greatest of:

(i) Mizuho’s base rate, (ii) 0.50 % above the federal funds rate, and (iii) 1.0 % above one-month LIBOR, subject to a floor of 0.75 % .

The Eurodollar rate represents adjusted LIBOR for the applicable interest period, subject to a floor of 0.75 % .

Fees include a facility fee based on the revolving credit commitments of the lenders.

(3) On April 14, 2021, the Company issued $ 500 million of publicly registered 1.700 % Senior Notes due 2026 (the “ 1.700 % Senior Notes”).

The Company used the net proceeds for general corporate purposes, including repayment of the prior $ 300 million Term Loan Facility.

(4) On April 28, 2021, the Company entered into an amendment (the “Amendment”) to its senior unsecured credit agreement dated as of January 22, 2020 (the “Credit Facility”).

The Amendment, among other things, (i) increased the commitments available under the three-year revolving credit facility (the “ Three-Year Revolving Credit Facility”) from $ 700 million to $ 1.2 billion, (ii) instituted certain sustainability-linked adjustments to the interest rates applicable to borrowings under the Credit Facility and (iii) extended the termination date of the Three-Year Revolving Credit Facility to January 22, 2024, and of the Five-Year Revolving Credit Facility of $ 2.0 billion to January 22, 2026.

(5) As of August 31, 2021, the Company has $ 3.8 billion in available unused borrowing capacity under its revolving credit facilities.

The Revolving Credit Facility under the Credit Facility acts as the back-up facility for commercial paper outstanding, if any.

The Credit Facility acts as the back-up facility for commercial paper outstanding, if any.

The Company has a borrowing capacity of up to $ 1.8 billion under its commercial paper program.

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Debt Maturities

Debt maturities as of August 31, 2020 are as follows (in thousands):

Debt maturities as of August 31, 2021 are as follows (in millions):

Fiscal Year Ended August 31,

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incur additional indebtedness, sell assets, effect mergers and certain transactions, and effect certain transactions with subsidiaries and affiliates.

In addition, the revolving credit facilities and the 4.900 % Senior Notes contain debt leverage and interest coverage covenants.

In addition, the revolving credit facilities and the 4.900 % Senior Notes contain debt leverage and

interest coverage covenants.

The Company is also subject to certain covenants requiring the Company to offer to repurchase the 4.700 %, 4.900 %, 3.950 %, 3.600 %, 3.000 % or 1.700 % Senior Notes upon a change of control.

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Asset-Backed Securitization Programs

The Company continuously sells designated pools of trade accounts receivable, at a discount, under its foreign asset-backed securitization program and its North American asset-backed securitization program to special purpose entities, which in turn sell certain of the receivables under the foreign program to an unaffiliated financial institution and a conduit administered by an unaffiliated financial institution and certain of the receivables under the North American program to conduits administered by an unaffiliated financial institution on a monthly basis.

The Company continues servicing the receivables sold and in exchange receives a servicing fee under each of the asset-backed securitization programs.

Global asset-backed securitization program - Effective August 20, 2021, the global securitization program (formerly referred to as the North American asset-backed securitization program) terms were amended to:

(i) add a foreign entity to the program, (ii) increase the maximum amount of net cash proceeds available at any one time from $ 390 million to $ 600 million and (iii) extend the expiration date of the program to November 25, 2024.

As of August 31, 2021, the Company had up to $ 24 million in available liquidity under its global asset-backed securitization program.

Certain entities participating in the global asset-backed securitization program continuously sell designated pools of trade accounts receivable to a special purpose entity, which in turn sells certain of the receivables at a discount to conduits administered by an unaffiliated financial institution on a monthly basis.

In addition, the foreign entity participating in the global asset-backed securitization program sells certain receivables at a discount to conduits administered by an unaffiliated financial institution on a daily basis.

The special purpose entity in the global asset-backed securitization program is a wholly-owned subsidiary of the Company and is included in the Company’s Consolidated Financial Statements.

Certain unsold receivables covering up to the maximum amount of net cash proceeds available under the domestic, or U.S., portion of the global asset-backed securitization program are pledged as collateral to the unaffiliated financial institution as of August 31, 2021.

Foreign asset-backed securitization program - The Company terminated the foreign asset-backed securitization program on June 28, 2021.

In connection with the termination, the Company paid approximately $ 167 million in cash, which consisted of:

(i) $ 68 million for the remittance of collections received prior to June 28, 2021, in the Company’s role as servicer of sold receivables and (ii) a repurchase of $ 99 million of all previously sold receivables, at fair value, that remained outstanding as of June 28, 2021.

As of August 31, 2021, the Company has substantially collected the repurchased receivables from customers.

The special purpose entity in the foreign asset-backed securitization program is a separate bankruptcy-remote entity that is winding down as a result of the termination of the foreign-asset backed securitization program.

The Company is deemed the primary beneficiary of this special purpose entity as the Company has both the power to direct the activities of the entity that most significantly impact the entity’s economic performance and the obligation to absorb losses or the right to receive the benefits that could potentially be significant to the entity from the transfer of the trade accounts receivable into the special purpose entity.

Accordingly, the special purpose entity associated with the foreign asset-backed securitization program is included in the Company’s Consolidated Financial Statements.

The foreign asset-backed securitization program contained a guarantee of payment by the special purpose entity, in an amount approximately equal to the net cash proceeds under the program.

As a result of the termination of the foreign asset-backed securitization program all outstanding amounts have been settled with the financial institution as of August 31, 2021.

As such, no liability has been recorded for obligations under the guarantee .

Global and foreign asset-backed securitization programs- The Company continues servicing the receivables sold and in exchange receives a servicing fee under the global asset-backed securitization programs.

Servicing fees related to each of the asset-backed securitization programs recognized during the fiscal years ended August 31, 2021, 2020 and 2019 were not material.

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Transfers of the receivables under the asset-backed securitization programs are accounted for as sales and, accordingly, net receivables sold under the asset-backed securitization programs are excluded from accounts receivable on the Consolidated Balance Sheets and are reflected as cash provided by operating activities on the Consolidated Statements of Cash Flows.

The special purpose entity in the foreign asset-backed securitization program is a separate bankruptcy-remote entity whose assets would be first available to satisfy the creditor claims of the unaffiliated financial institution.

Accordingly, the special purpose entity associated with the foreign asset-backed securitization program is included in the Company’s Consolidated Financial Statements.

As of August 31, 2020 , the special purpose entity has liabilities for which creditors do not have recourse to the general credit of the Company (primary beneficiary).

The liabilities cannot exceed the maximum amount of net cash proceeds under the foreign asset-backed securitization program.

The foreign asset-backed securitization program contains a guarantee of payment by the special purpose entity, in an amount approximately equal to the net cash proceeds under the program.

No liability has been recorded for obligations under the guarantee as of August 31, 2020 .

The special purpose entity in the North American asset-backed securitization program is a wholly-owned subsidiary of the Company and is included in the Company’s Consolidated Financial Statements.

Certain unsold receivables covering the maximum amount of net cash proceeds available under the North American asset-backed securitization program are pledged as collateral to the unaffiliated financial institution as of August 31, 2020 .

Following is a summary of the asset-backed securitization programs and key terms:

Maximum Amount of

Net Cash Proceeds (in millions) (1)(2)

North American

November 22, 2021

September 30, 2021

Maximum amount available at any one time.

As of August 31, 2020 , the Company had up to $ 49.0 million in available liquidity under its asset-backed securitization programs.

In connection with the asset-backed securitization programs, the Company recognized the following (in millions):

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Cash proceeds received (1)

Proceeds due from bank

Pre-tax losses on sale of receivables (2)

Deferred purchase price receivables as of August 31

(1) The amounts primarily represent proceeds from collections reinvested in revolving-period transfers.

(2) Recorded to other expense within the Consolidated Statements of Operations.

Excludes $ 650.3 million of trade accounts receivable sold, $ 488.1 million of cash and $ 13.9 million of net cash received prior to the amendment of the foreign asset-backed securitization program and under the previous North American asset-backed securitization program which occurred during the first quarter of fiscal year 2019.

The asset-backed securitization programs require compliance with several covenants.

The North American asset-backed securitization program covenants include compliance with the interest ratio and debt to EBITDA ratio of the five-year unsecured credit facility entered into on January 22, 2020 (the “Credit Facility”).

The foreign asset-backed securitization program covenants include limitations on certain corporate actions such as mergers and consolidations.

As of August 31, 2020 and 2019 , the Company was in compliance with all covenants under the asset-backed securitization programs.

(3) Includes trade accounts receivable sold and cash proceeds received under the foreign asset-backed securitization program through June 28, 2021, except for $ 99 million of previously sold receivables that were repurchased.

(4) Excludes $ 650 million of trade accounts receivable sold, $ 488 million of cash and $ 14 million of net cash received prior to the amendment of the foreign asset-backed securitization program and under the global asset-backed securitization program which occurred during the first quarter of fiscal year 2019.

The global asset-backed securitization program requires compliance with several covenants including compliance with the interest ratio and debt to EBITDA ratio of the Credit Facility.

As of August 31, 2021 and 2020, the Company was in compliance with all covenants under the global asset-backed securitization program.

As of August 31, 2020, the Company was in compliance with all covenants under the foreign asset-backed securitization program.

Accrued Expenses

Accrued expenses consist of the following (in thousands):

Accrued expenses consist of the following (in millions):

August 31, 2021

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Accrued compensation and employee benefits

Obligation associated with securitization programs

Inventory deposits

Other accrued expenses

Accrued expenses

Revenue recognized during the fiscal years ended August 31, 2020 and 2019 that was included in the contract liability balance as of August 31, 2019 and September 1, 2018 was $ 308.1 million and $ 404.0 million , respectively.

(1) Revenue recognized during the fiscal years ended August 31, 2021 and 2020 that was included in the contract liability balance as of August 31, 2020 and 2019 was $ 365 million and $ 308 million, respectively.

Postretirement and Other Employee Benefits

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As a result of the third closing of the JJMD acquisition, the Company assumed a pension obligation for employees in Switzerland (the “Switzerland plan”).

The Switzerland plan, which is a qualified defined benefit pension plan, provides benefits based on average employee earnings over an approximately 8 years service period preceding retirement and length of employee service.

The Switzerland plan, which is a qualified defined benefit pension plan, provides benefits based on average employee earnings over an approximately 8 year service period preceding retirement and length of employee service.

The Company’s policy is to contribute amounts sufficient to meet minimum funding requirements as set forth in Switzerland employee benefit and tax laws plus such additional amounts as are deemed appropriate by the Company.

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Benefit Obligation and Plan Assets

The benefit obligations and plan assets, changes to the benefit obligation and plan assets and the funded status of the plans as of and for the fiscal years ended August 31 are as follows (in thousands):

The projected benefit obligations (“PBO”) and plan assets, changes to the PBO and plan assets and the funded status of the plans as of and for the fiscal years ended August 31 are as follows (in millions):

Fiscal Year Ended August 31,

Change in projected benefit obligation

Beginning projected benefit obligation

Change in PBO

Beginning PBO

Interest cost

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Plan participants’ contributions

Plan amendments

Effect of conversion to U.S.

Ending projected benefit obligation

Change in plan assets

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Prior service cost, before tax

The settlements recognized during fiscal year 2020 relate primarily to the Switzerland plan.

(1) The settlements recognized during fiscal years 2021 and 2020 relate primarily to the Switzerland plan.

(2) The Company anticipates amortizing $ 19 million and $ 4 million, before tax, of net actuarial gain and prior service costs balances, respectively, to net periodic cost in fiscal year 2022.

Accumulated Benefit Obligation

The following table summarizes the total accumulated benefit obligations (“ABO”), the ABO and fair value of plan assets for defined benefit pension plans with ABO in excess of plan assets, and the PBO and fair value of plan assets for defined benefit pension plans with PBO in excess of plan assets for fiscal years 2021 and 2020 (in millions):

August 31, 2021

August 31, 2020

Plans with ABO in excess of plan assets

Fair value of plan assets

Plans with PBO in excess of plan assets

Fair value of plan assets

Net Periodic Benefit Cost

The following table provides information about the net periodic benefit cost for the plans for fiscal years 2020 , 2019 and 2018 (in thousands):

The following table provides information about the net periodic benefit cost for the plans for fiscal years 2021, 2020 and 2019 (in millions):

Fiscal Year Ended August 31,

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Recognized actuarial (gain) loss

Amortization of prior service credit

Amortization of actuarial gains (1)

Net settlement loss

Amortization of prior service costs

Net periodic benefit cost

Weighted-average actuarial assumptions used to determine net periodic benefit cost and projected benefit obligation for the plans for the fiscal years 2020 , 2019 and 2018 were as follows:

(1) Actuarial gains and losses are amortized using a corridor approach.

The gain/loss corridor is equal to 10 percent of the greater of the projected benefit obligation and the fair value of plan assets.

Gains and losses in excess of the corridor are generally amortized over the average future working lifetime of the plan participants.

Weighted-average actuarial assumptions used to determine net periodic benefit cost and PBO for the plans for the fiscal years 2021, 2020 and 2019 were as follows:

Fiscal Year Ended August 31,

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Discount rate

Projected benefit obligation:

Expected long-term return on plan assets

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Within the debt securities class, the investment policy provides for investments in corporate bonds as well as fixed and variable interest debt instruments.

The Company currently expects to achieve a target mix of 35 % equity and 65 % debt securities in fiscal year 2021 .

The fair values of the plan assets held by the Company by asset category are as follows (in thousands):

The Company currently expects to achieve a target mix of 35 % to 45 % equity and 55 % to 65 % debt securities in fiscal year 2022.

The fair values of the plan assets held by the Company by asset category are as follows (in millions):

August 31, 2021

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The unobservable inputs consist of estimated future benefits to be paid throughout the duration of the policy and estimated discount rates, which both have an immaterial impact on the fair value estimate of the contract.

Accumulated Benefit Obligation

The following table provides information for the plans with an accumulated benefit obligation for fiscal years 2020 and 2019 (in thousands):

August 31, 2020

August 31, 2019

Projected benefit obligation

Accumulated benefit obligation

Fair value of plan assets

The Company expects to make cash contributions between $ 24 million and $ 30 million to its funded pension plans during fiscal year 2022.

The estimated future benefit payments, which reflect expected future service, are as follows (in thousands):

The estimated future benefit payments, which reflect expected future service, are as follows (in millions):

Fiscal Year Ended August 31,

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Forward contracts are put in place to manage the foreign currency risk associated with the anticipated foreign currency denominated revenues and expenses.

A hedging relationship existed with an aggregate notional amount outstanding of $ 355.2 million and $ 334.1 million as of August 31, 2020 and 2019 , respectively.

A hedging relationship existed with an aggregate notional amount outstanding of $ 1.5 billion and $ 355 million as of August 31, 2021 and 2020, respectively.

The related forward foreign exchange contracts have been designated as hedging instruments and are accounted for as cash flow hedges.

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The gains and losses recognized in earnings due to hedge ineffectiveness and the amount excluded from effectiveness testing were not material for all periods presented and are included as components of net revenue, cost of revenue and selling, general and administrative expense, which are the same line items in which the hedged items are recorded.

The following table presents the net gains (losses) from forward contracts recorded in the Consolidated Statements of Operations for the periods indicated (in thousands):

The following table presents the net gains (losses) from forward contracts recorded in the Consolidated Statements of Operations for the periods indicated (in millions):

Derivatives Not Designated as Hedging Instruments Under ASC 815

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Cost of revenue

For the fiscal year ended August 31, 2020 , the Company recognized $ 47.4 million of foreign currency losses in cost of revenue, which are offset by the gains from the forward foreign exchange contracts.

For the fiscal years ended August 31, 2019 and 2018 , the Company recognized $ 14.9 million and $ 36.7 million , respectively, of foreign currency gains in cost of revenue, which are offset by the losses from the forward foreign exchange contracts.

(1) For the fiscal years ended August 31, 2021 and 2020, the Company recognized $ 105 million and $ 47 million, respectively, of foreign currency losses in cost of revenue, which are offset by the gains from the forward foreign exchange contracts.

For the fiscal year ended August 31, 2019, the Company recognized $ 15 million of foreign currency gains in cost of revenue, which are offset by the losses from the forward foreign exchange contracts.

Interest Rate Risk Management

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Cash Flow Hedges

Contemporaneously with the issuance of our 3.000 % Notes in July 2020, the Company amended interest rate swap agreements with a notional value of $ 200.0 million , with mandatory termination dates from August 15, 2020 to February 15, 2022 and de-designated the interest rate swaps as cash flow hedges (the “2020 Extended Interest Rate Swaps”).

No ineffectiveness was recognized in earnings upon the termination of the cash flow hedges.

The following table presents the interest rate swaps outstanding as of August 31, 2021, which have been designated as hedging instruments and accounted for as cash flow hedges:

Interest Rate Swap Summary

Hedged Interest Rate Payments

Aggregate Notional Amount (in millions)

Effective Date

Expiration Date (1)

Forward Interest Rate Swap

Anticipated Debt Issuance

November 2, 2020

July 31, 2024

Anticipated Debt Issuance

July 31, 2024

(1) The contracts will be settled with the respective counterparties on a net basis at the expiration date for the forward interest rate swap.

(2) If the anticipated debt issuance occurs before July 31, 2024, the contracts will be terminated simultaneously with the debt issuance.

Contemporaneously with the issuance of our 3.000 % Notes in July 2020, the Company amended interest rate swap agreements with a notional value of $ 200 million, with mandatory termination dates from August 15, 2020 through February

15, 2022 (the “2020 Extended Interest Rate Swaps”).

In addition, the Company entered into interest rate swaps to offset future exposures of fluctuations in the fair value of the 2020 Extended Interest Rate Swaps (the “Offsetting Interest Rate Swaps”).

The change in the fair value of the 2020 Extended Interest Rate Swaps and the Offsetting Interest Rate Swaps will be recorded in the Consolidated Statements of Income through the maturity date as an adjustment to interest expense.

The change in fair value of the 2020 Extended Interest Rate Swaps and Offsetting Interest Rate Swaps will be recorded in the Consolidated Statements of Income through the maturity date as an adjustment to interest expense.

Stockholders’ Equity

The Company recognized stock-based compensation expense within selling, general and administrative expense as follows (in thousands):

The Company recognized stock-based compensation expense within selling, general and administrative expense as follows (in millions):

Fiscal Year Ended August 31,

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Employee stock purchase plan

As a result of a modification, 0.8 million awards vested during fiscal year 2018, which resulted in approximately $ 24.9 million of stock-based compensation expense recognized during the fiscal year ended August 31, 2018.

For the fiscal year ended August 31, 2018, represents a one-time cash-settled stock award that vested on November 30, 2017.

Equity Compensation Plan

The 2011 Stock Award and Incentive Plan (the “2011 Plan”) provides for the grant of restricted stock awards, restricted stock unit awards and other stock-based awards.

The maximum aggregate number of shares that may be subject to awards under the 2011 Plan is 23,300,000 .

Following is a reconciliation of the shares available to be issued under the 2011 Plan as of August 31, 2020 :

On January 21, 2021, the 2021 Equity Incentive Plan (the “2021 EIP”) was approved by the shareholders of the Company.

The 2021 EIP replaced the Company’s 2011 Stock Award and Incentive Plan (the “2011 Plan”), which terminated on October 21, 2020.

The maximum aggregate number of shares that are available for issuance under the 2021 EIP is 11,000,000 , which includes the:

(i) additional shares authorized by the shareholders in January 2021 and (ii) the shares previously available for issuance under the 2011 Plan.

Following is a reconciliation of the shares available to be issued under the 2021 EIP as of August 31, 2021:

Shares Available for Grant

Balance as of August 31, 2020

SARS canceled

Shares authorized

Restricted stock units granted, net of forfeitures (1)

( 1,861,711 )

Balance as of August 31, 2021

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Outstanding as of August 31, 2020

SARS canceled

SARS exercised

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Shares vested

( 2,290,104 )

Shares forfeited

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During the fiscal year ended August 31, 2021, the Company awarded approximately 1.2 million time-based restricted stock units, 0.4 million performance-based restricted stock units and 0.3 million market-based restricted stock units based on target performance criteria.

The following table represents the restricted stock units and SARS stock-based compensation information for the periods indicated (in thousands):

The following table represents the restricted stock units and SARS stock-based compensation information for the periods indicated (in millions):

Fiscal Year Ended August 31,

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Employee Stock Purchase Plan

The maximum aggregate number of shares that are available for issuance under the 2011 Employee Stock Purchase Plan (the “ESPP”) is 12,000,000 .

On January 21, 2021 the Company’s shareholders approved increasing the maximum aggregate number of shares available for issuance under the 2011 Employee Stock Purchase Plan (the “ESPP”) to 23,000,000 .

Employees are eligible to participate in the ESPP after 90 days of employment with the Company.

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Dividend Cash

(in thousands, except for per share data)

(in millions, except for per share data)

Fiscal Year 2021:

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Treasury shares purchased (1)(2)(3)

( 8,799,400 )

( 5,992,246 )

( 13,854,607 )

Ending balances

During fiscal years 2018 and 2017, the Company’s Board of Directors (“the Board”) authorized the repurchase of $ 350.0 million and $ 450.0 million , respectively, of the Company’s common stock under share repurchase programs, which were repurchased during fiscal years 2019 and 2018, respectively.

In September 2019, the Board authorized the repurchase of up to $ 600.0 million of the Company’s common stock as part of a two -year capital allocation framework (“the 2020 Share Repurchase Program”).

(1) During fiscal year 2018, the Board of Directors authorized the repurchase of $ 350 million of the Company’s common stock under share repurchase programs, which were repurchased during fiscal year 2019.

(2) In September 2019, the Board of Directors authorized the repurchase of up to $ 600 million of the Company’s common stock as part of a two-year capital allocation framework (“the 2020 Share Repurchase Program”).

As of August 31, 2021, 14.1 million shares had been repurchased for $ 600 million and no authorization remains under the 2020 Share Repurchase Program.

(3) In July 2021, the Board of Directors approved an authorization for the repurchase of up to $ 1.0 billion of the Company’s common stock (“the 2022 Share Repurchase Program”).

As of August 31, 2021, 0.7 million shares had been repurchased for $ 42 million and $ 958 million remains available under the 2022 Share Repurchase Program.

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For trade receivables, the Company performs ongoing credit evaluations of its customers and generally does not require collateral.

The Company maintains an allowance for potential credit losses on trade receivables.

The Company maintains an allowance for expected credit losses on trade receivables.

Sales of the Company’s products are concentrated among specific customers.

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The EMS segment is focused around leveraging IT, supply chain design and engineering, technologies largely centered on core electronics, utilizing the Company’s large scale manufacturing infrastructure and the ability to serve a broad range of end markets.

The EMS segment is a high volume business that produces products at a quicker rate (i.e.

cycle time) and in larger quantities and includes customers primarily in the automotive and transportation, capital equipment, cloud, computing and storage, defense and aerospace, industrial and energy, networking and telecommunications, print and retail, and smart home and appliances industries.

The EMS segment is a high volume business that produces product at a quicker rate (i.e.

cycle time) and in larger quantities and includes customers primarily in the 5G, wireless and cloud, digital print and retail, industrial and semi-cap, and networking and storage industries.

The DMS segment is focused on providing engineering solutions, with an emphasis on material sciences, technologies and healthcare.

The DMS segment includes customers primarily in the edge devices and accessories, healthcare, mobility and packaging industries.

The DMS segment includes customers primarily in the automotive and transportation, connected devices, healthcare and packaging, and mobility industries.

Net revenue for the operating segments is attributed to the segment in which the service is performed.

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Segment income is defined as net revenue less cost of revenue, segment selling, general and administrative expenses, segment research and development expenses and an allocation of corporate manufacturing expenses and selling, general and administrative expenses.

Segment income does not include amortization of intangibles, stock-based compensation expense and related charges, restructuring, severance and related charges, distressed customer charges, acquisition and integration charges, loss on disposal of subsidiaries, settlement of receivables and related charges, impairment of notes receivable and related charges, loss on securities, goodwill impairment charges, business interruption and impairment charges, net, income (loss) from discontinued operations, gain (loss) on sale of discontinued operations, other expense (excluding certain components of net periodic benefit cost), interest income, interest expense, income tax expense or adjustment for net income (loss) attributable to noncontrolling interests.

Total segment assets are defined as accounts receivable, inventories, net, customer-related property, plant and equipment, intangible assets net of accumulated amortization and goodwill.

Segment income does not include amortization of intangibles, stock-based compensation expense and related charges, restructuring, severance and related charges, distressed customer charges, acquisition and integration charges, loss on disposal of subsidiaries, settlement of receivables and related charges, impairment of notes receivable and related charges, (gain) loss on securities, goodwill impairment charges, business interruption and impairment charges, net, income (loss) from discontinued operations, gain (loss) on sale of discontinued operations, other expense (excluding certain components of net periodic benefit cost), interest income, interest expense, income tax expense or adjustment for net income (loss) attributable to noncontrolling interests.

Total segment assets are defined as accounts receivable, contract assets, inventories, net, customer-related property, plant and equipment, intangible assets net of accumulated amortization and goodwill.

All other non-segment assets are reviewed on a global basis by management.

Transactions between operating segments are generally recorded at amounts that approximate those at which we would transact with third parties.

As of September 1, 2020, certain customers have been realigned within the Company’s operating segments.

As of September 1, 2020, certain customers were realigned within the Company’s operating segments.

As there have been no changes to how the Company’s CODM assesses operating performance and allocates resources, the Company’s operating segments which are the reporting segments continue to consist of the DMS and EMS segments.

Beginning in fiscal year 2021, customers within the automotive and transportation and smart home and appliances industries will be presented within the DMS segment.

Prior period disclosures will be restated to reflect the realignment.

The following table presents the Company’s revenues disaggregated by segment (in thousands):

Beginning in fiscal year 2021, customers within the automotive and transportation and smart home and appliances industries are presented within the DMS segment.

Prior period disclosures are restated to reflect the realignment.

The following table presents the Company’s revenues disaggregated by segment (in millions):

Fiscal Year Ended August 31,

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Point in time

Effective September 1, 2018, the Company adopted ASU 2014-09, Revenue Recognition (Topic 606) using the modified retrospective method by applying the guidance to all open contracts upon adoption and recording a cumulative effect adjustment as of September 1, 2018, net of tax, of $ 42.6 million .

No adjustments were made to prior periods.

The following tables set forth operating segment information (in thousands):

Fiscal Year Ended August 31,

The following tables set forth operating segment information (in millions):

Fiscal Year Ended August 31,

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Acquisition and integration charges

Loss on securities

Gain (loss) on securities

Other expense (net of periodic benefit cost)

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Income before income tax

Charges for the fiscal year ended August 31, 2020 , relate to a flood that impacted the Company’s facility in Huangpu, China.

Charges, net of insurance proceeds of $ 2.9 million and $ 24.9 million , for the fiscal years ended August 31, 2019 and 2018 , respectively, relate to business interruption and asset impairment costs associated with damage from Hurricane Maria, which impacted operations in Cayey, Puerto Rico.

These charges are classified as a component of cost of revenue and selling, general and administrative expenses in the Consolidated Statements of Operations.

(in millions)

August 31, 2021

August 31, 2020

Total assets:

Other non-allocated assets

The Company operates in 31 countries worldwide.

The Company operates in more than 30 countries worldwide.

Sales to unaffiliated customers are based on the Company location that maintains the customer relationship and transacts the external sale.

The following tables set forth external net revenue, net of intercompany eliminations, and long-lived asset information where individual countries represent a material portion of the total (in thousands):

Fiscal Year Ended August 31,

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Restructuring, Severance and Related Charges

Following is a summary of the Company’s restructuring, severance and related charges (in thousands):

Following is a summary of the Company’s restructuring, severance and related charges (in millions):

Fiscal Year Ended August 31,

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Total restructuring, severance and related charges (3)

Includes $ 61.9 million , $ 21.5 million and $ 16.3 million recorded in the EMS segment, $ 75.6 million , $ 2.6 million and $ 16.6 million recorded in the DMS segment and $ 19.1 million , $ 1.8 million and $ 4.0 million of non-allocated charges for the fiscal years ended August 31, 2020 , 2019 and 2018 , respectively.

Except for asset write-off costs, all restructuring, severance and related charges are cash settled.

As the Company continues to optimize its cost structure and improve operational efficiencies, $ 56.6 million of employee severance and benefit costs was incurred in connection with a reduction in the worldwide workforce during the fiscal year ended August 31, 2020 .

The remaining amount primarily relates to the 2020 Restructuring Plan.

The Company’s liability associated with the worldwide workforce reduction is $ 35.8 million as of August 31, 2020 .

(1) As the Company continued to optimize its cost structure and improve operational efficiencies, $ 57 million of employee severance and benefit costs was incurred in connection with a reduction in the worldwide workforce during the fiscal year ended August 31, 2020.

The remaining amount primarily relates to the 2020 Restructuring Plan, which was complete as of August 31, 2021.

(2) Primarily relates to the 2017 Restructuring Plan, which was complete as of August 31, 2019.

(3) Includes $ 0 million , $ 62 million and $ 21 million recorded in the EMS segment, $ 9 million, $ 76 million and $ 3 million recorded in the DMS segment and $ 1 million, $ 19 million and $ 2 million of non-allocated charges for the fiscal years ended August 31, 2021, 2020 and 2019, respectively.

Except for asset write-off costs, all restructuring, severance and related charges are cash costs.

2020 Restructuring Plan

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This action includes headcount reductions and capacity realignment (the “2020 Restructuring Plan”).

The 2020 Restructuring Plan reflects the Company’s intention only and restructuring decisions, and the timing of such decisions, at certain locations are still subject to consultation with the Company’s employees and their representatives.

Upon completion of the 2020 Restructuring Plan, the Company expects to recognize approximately $ 85.0 million in restructuring and other related costs.

The Company incurred $ 76.9 million of costs during fiscal year 2020 and anticipates incurring the remaining costs during fiscal year 2021 for employee severance and benefit costs, asset write-off costs, and other related costs.

The tables below summarize the Company’s liability activity (in thousands):

The 2020 Restructuring Plan, totaling $ 86 million in restructuring and other related costs, is complete as of August 31, 2021.

The tables below summarizes the Company’s liability activity (in millions):

Employee Severance

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(1) Balance as of August 31, 2019 primarily relates to the 2017 Restructuring Plan.

Balance as of August 31, 2020 primarily relates to the 2020 Restructuring Plan.

(2) Balance as of August 31, 2020 and 2021 primarily relates to the 2020 Restructuring Plan.

Provision for Income Taxes

Income (loss) before income tax expense is summarized below (in thousands):

Income (loss) before income tax expense is summarized below (in millions):

Fiscal Year Ended August 31,

(1) Includes the elimination of intercompany foreign dividends paid to the U.S.

Income tax expense (benefit) is summarized below (in thousands):

Income tax expense (benefit) is summarized below (in millions):

Fiscal Year Ended August 31,

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Impact of foreign tax rates (1)(2)

Permanent impact of non-deductible cost

Permanent differences

Income tax credits (1)

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Impact of intercompany charges and dividends

Reclassification of stranded tax effects in AOCI

Global Intangible Low-Taxed Income

Effective income tax rate

The Company has been granted tax incentives for various subsidiaries in Brazil, China, Malaysia, Singapore and Vietnam, which expire at various dates through fiscal year 2031 and are subject to certain conditions with which the Company expects to comply.

(1) The Company has been granted tax incentives for various subsidiaries in China, Malaysia, Singapore and Vietnam, which primarily expire at various dates through fiscal year 2031 and are subject to certain conditions with which the Company expects to comply.

These tax incentives resulted in a tax benefit of approximately $ 51 million ($ 0.34 per basic share), $ 43 million ($ 0.28 per basic share) and $ 67 million ($ 0.43 per basic share) during the fiscal years ended August 31, 2021, 2020 and 2019, respectively.

(2) For the fiscal year ended August 31, 2021, the increase in the impact of foreign tax rates was primarily related to increased income in low tax rate jurisdictions.

For the fiscal year ended August 31, 2020, the decrease in the impact of foreign tax rates was primarily related to decreased income in low tax rate jurisdictions.

For the fiscal year ended August 31, 2019, the decrease in the impact of foreign tax rates was primarily due to a decrease in the U.S.

federal statutory income tax rate due to the Tax Act.

federal statutory income tax rate due to the Tax Cuts and Jobs Act of 2017 (“Tax Act”).

(3) For the fiscal year ended August 31, 2020, the increase in the changes in tax rates on deferred tax assets and liabilities was primarily due to the re-measurement of deferred tax assets related to an extension of a non-U.S.

tax incentive of $ 21 million.

For the fiscal year ended August 31, 2018 , the changes in tax rates on deferred tax assets and liabilities included changes related to the Tax Act, excluding the impact of the enacted rate change on the U.S.

valuation allowance.

The one-time transition tax impact for the fiscal year ended August 31, 2018 was due to the comprehensive tax legislation enacted on December 22, 2017, commonly referred to as the Tax Cuts and Jobs Act of 2017 (“Tax Act”).

The enacted changes included a mandatory income inclusion of the historically untaxed foreign earnings of a U.S.

company’s foreign subsidiaries and effectively taxed such income at reduced tax rates (“transition tax”).

The calculation of the one-time transition tax is based upon post-1986 earnings and profits, applicable foreign tax credits

and relevant limitations, utilization of U.S.

federal net operating losses and tax credits and the amount of foreign earnings held in cash and non-cash assets.

As a result of the Tax Act, the Company made a change to the indefinite reinvestment assertion for the fiscal year ended August 31, 2018 resulting in foreign withholding taxes that would be incurred upon such future remittances of cash.

The valuation allowance change for the fiscal year ended August 31, 2020 was primarily due to the increase in deferred tax assets for sites with existing valuation allowances.

The valuation allowance change for the fiscal years ended August 31, 2019 and 2018 was primarily due to utilization of domestic 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 for the fiscal year ended August 31, 2018 .

(4) The valuation allowance change for the fiscal years ended August 31, 2021 and 2020 was primarily due to the change in deferred tax assets for sites with existing valuation allowances.

The valuation allowance change for the fiscal year ended August 31, 2019 was primarily due to utilization of domestic federal net operating losses and tax credits against the one-time transition tax.

The increase for the fiscal year ended August 31, 2019 was partially offset by an income tax benefit of $ 18 million for the reversal of a U.S.

valuation allowance due to an intangible asset reclassification from indefinite-life to finite-life.

GILTI, a newly defined category of foreign subsidiary income which is taxable to U.S.

shareholders each year, applied beginning in the fiscal year ended August 31, 2019 and primarily results in the utilization of current year U.S.

federal operating losses.

The Company records the effects of GILTI as a period cost.

Deferred Tax Assets and Liabilities

Significant components of the deferred tax assets and liabilities are summarized below (in thousands):

Significant components of the deferred tax assets and liabilities are summarized below (in millions):

Fiscal Year Ended August 31,

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Accrued expenses

Property, plant and equipment, principally due to differences in depreciation and amortization

Property, plant and equipment

Domestic tax credits

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Revenue recognition

Operating lease liabilities

Operating and finance lease liabilities

Total deferred tax assets before valuation allowances

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Net deferred tax assets

Based on the Company’s historical operating income, projection of future taxable income, scheduled reversal of taxable temporary differences, and tax planning strategies, management believes that it is more likely than not that the Company will realize the benefit of its deferred tax assets, net of valuation allowances recorded.

Based on the Company’s historical operating income, projection of future taxable income, scheduled reversal of taxable temporary differences, and tax planning strategies, management believes it is more likely than not that the Company will realize the benefit of its deferred tax assets, net of valuation allowances recorded.

As of August 31, 2021, the Company intends to indefinitely reinvest the remaining earnings from its foreign subsidiaries for which a deferred tax liability has not already been recorded.

The accumulated earnings are the most significant component

of the basis difference which is indefinitely reinvested.

The accumulated earnings are the most significant component of the basis difference which is indefinitely reinvested.

As of August 31, 2021, the indefinitely reinvested earnings in foreign subsidiaries upon which taxes had not been provided were approximately $ 2.4 billion.

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The amount and expiration dates of income tax net operating loss carryforwards, tax credit carryforwards, and tax capital loss carryforwards, which are available to reduce future taxes, if any, as of August 31, 2021 are as follows:

(dollars in thousands)

(dollars in millions)

Last Fiscal Year of Expiration

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Unrecognized Tax Benefits

Reconciliation of the unrecognized tax benefits is summarized below (in thousands):

Reconciliation of the unrecognized tax benefits is summarized below (in millions):

Fiscal Year Ended August 31,

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net operating loss carryforwards, offset with a valuation allowance and the impacts of the Tax Act.

The additions for the fiscal years ended August 31, 2020 are primarily related to taxation of certain intercompany transactions.

The additions for the fiscal years ended August 31, 2019 and 2018 are primarily related to the impacts of the Tax Act and taxation of certain intercompany transactions.

(2) The additions for the fiscal years ended August 31, 2021 and 2020 are primarily related to taxation of certain intercompany transactions.

The additions for the fiscal year ended August 31, 2019 are primarily related to the impacts of the Tax Act and taxation of certain intercompany transactions.

(3) The reductions from settlements with taxing authorities for the fiscal year ended August 31, 2019 are primarily related to the settlement of a U.S.

The Company recognizes interest and penalties related to unrecognized tax benefits in income tax expense.

The Company’s accrued interest and penalties were approximately $ 22.8 million and $ 18.9 million as of August 31, 2020 and 2019 ,

respectively.

The Company’s accrued interest and penalties were approximately $ 30 million and $ 23 million as of August 31, 2021 and 2020, respectively.

The Company recognized interest and penalties of approximately $ 7 million, $ 4 million and $( 2 ) million during the fiscal years ended August 31, 2021, 2020 and 2019, respectively.

5 unchanged sentences

Business Acquisitions

Fiscal years 2019 and 2020

During fiscal year 2018, the Company and Johnson & Johnson Medical Devices Companies (“JJMD”) entered into a framework agreement to form a strategic collaboration and expand its existing relationship.

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The aggregate purchase price paid for the third closing was approximately $ 113 million in cash.

For the third closing, total assets acquired of $ 196.2 million , including $ 80.7 million in contract assets, $ 34.0 million in inventory and $ 56.0 million in goodwill, and total liabilities assumed of $ 83.1 million , including $ 73.5 million of pension obligations, were recorded at their estimated fair values as of the acquisition date.

For the third closing, total assets acquired of $ 196 million, including $ 81 million in contract assets, $ 34 million in

inventory and $ 56 million in goodwill, and total liabilities assumed of $ 83 million, including $ 74 million of pension obligations, were recorded at their estimated fair values as of the acquisition date.

There were no intangible assets identified in this acquisition and the goodwill is primarily attributable to the assembled workforce.

The majority of the goodwill is currently not expected to be deductible for income tax purposes.

On October 26, 2020, under the terms of the framework agreement, the Company completed the fourth closing of its acquisition of certain assets of JJMD.

The aggregate purchase price paid for the fourth closing was approximately $ 19 million in cash.

Total assets acquired of $ 30 million and total liabilities assumed of $ 11 million were recorded at their estimated fair values as of the acquisition date.

The acquisitions of the JJMD assets have been accounted for as separate business combinations for each closing using the acquisition method of accounting.

The results of operations were included in the Company’s consolidated financial results beginning on February 25, 2019 for the initial closing, April 29, 2019 for the second closing and September 30, 2019 for the third closing.

The Company is currently evaluating the fair value of the assets and liabilities related to the fourth closing.

The preliminary estimates and measurements are, therefore, subject to change during the measurement period for assets acquired, liabilities assumed and tax adjustments.

The Company believes it is impracticable to provide pro forma information for the acquisitions of the JJMD assets.

Fiscal year 2018

On September 1, 2017 , the Company completed the acquisition of True-Tech Corporation (“True-Tech”) for approximately $ 95.9 million in cash.

True-Tech is a manufacturer specializing in aerospace, semiconductor and medical machined components.

The acquisition of True-Tech assets was accounted for as a business combination using the acquisition method of accounting.

Assets acquired of $ 114.7 million , including $ 25.9 million in intangible assets and $ 22.6 million in goodwill, and liabilities assumed of $ 18.8 million were recorded at their estimated fair values as of the acquisition date.

The excess of the purchase price over the fair value of the acquired assets and assumed liabilities was recorded to goodwill and was fully allocated to the EMS segment.

The majority of the goodwill is currently expected to be deductible for income tax purposes.

The results of operations were included in the Company’s consolidated financial results beginning on September 1, 2017.

Pro forma information has not been provided as the acquisition of True-Tech is not deemed to be significant.

Fair Value Measurements

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 thousands)

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

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Other assets:

Senior Non-Convertible Preferred Stock

Forward interest rate swap:

Derivatives designated as hedging instruments (Note 11)

Accrued expenses:

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Interest rate swaps:

Derivatives designated as hedging instruments (Note 11)

Derivatives not designated as hedging instruments (Note 11)

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Other liabilities:

Interest rate swap:

Derivatives designated as hedging instruments (Note 11)

Derivatives not designated as hedging instruments (Note 11)

Interest rate swaps:

Extended interest rate swap not designated as a hedging instrument (Note 11)

Forward interest rate swap:

Derivatives designated as hedging instruments (Note 11)

(1) Consist of investments that are readily convertible to cash with original maturities of 90 days or less.

(2) The Company’s forward foreign exchange contracts 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.

During the fourth quarter of fiscal year 2020, the Company recognized an impairment on its investment in the Senior Non-Convertible Preferred Stock of iQor Holdings, Inc.

(“iQor”) in connection with iQor’s bankruptcy filing.

The Company does not expect to recover any of the investment value and recognized the entire remaining investment of $ 36.4 million as a loss on securities.

(3) Fair value measurements are based on the contractual terms of the derivatives and use observable market-based inputs.

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Assets Held for Sale

The following table presents the assets held for sale (in thousands):

The following table presents the assets held for sale (in millions):

August 31, 2021

August 31, 2020

(in thousands)

Carrying Amount

8 unchanged sentences

however, the Company estimates the fair value 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:

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):

August 31, 2021

August 31, 2020

(in thousands)

Fair Value Hierarchy

12 unchanged sentences

Commitments and Contingencies

Lease Agreements

The Company primarily has leases for buildings and real estate with lease terms ranging from 1 year to 36 years .

Refer to Note 5 – “Leases” for the future minimum lease payments under operating and finance leases as of August 31, 2020 .

Legal Proceedings

3 unchanged sentences

Recently Adopted Accounting Guidance

During fiscal year 2016, the FASB issued a new accounting standard revising lease accounting, which requires the Company to recognize right-of-use assets and lease liabilities on the Consolidated Balance Sheet and disclose key information regarding leasing arrangements.

The accounting standard became effective for the Company in fiscal year 2020.

Refer to Note 5 - “Leases” to the Consolidated Financial Statements for further details.

During fiscal year 2017, the FASB issued a new accounting standard to improve the financial reporting of hedging relationships to better portray the economic results of an entity’s risk management activities by simplifying the application of hedge accounting and improving the related disclosures in its financial statements.

This guidance became effective for the Company beginning in fiscal year 2020.

The guidance was applied using a modified retrospective approach.

During fiscal year 2016, the FASB issued an accounting standard, which replaces the existing incurred loss impairment model with an expected credit loss model and requires a financial asset measured at amortized cost to be presented at the net amount expected to be collected.

The Company adopted the guidance during the first quarter of fiscal year 2021.

The adoption of this standard did not have a material impact on the Company’s Consolidated Financial Statements.

Recently Issued Accounting Guidance

amount expected to be collected.

This guidance is effective for the Company beginning in the first quarter of fiscal year 2021.

This guidance must be applied using a modified retrospective or prospective transition method, depending on the area covered by this accounting standard.

The adoption of this standard does not have a material impact on its Consolidated Financial Statements.

During fiscal year 2018, the FASB issued a new accounting standard which aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software.

This guidance will be applied prospectively and is effective for the Company beginning in the first quarter of fiscal year 2021.

The Company does not expect this new standard to have a material impact on its Consolidated Financial Statements.

During the third quarter of fiscal year 2020, the FASB issued a new accounting standard which provides guidance in accounting for contracts, hedging relationships, and other transactions that reference U.S.

dollar LIBOR or another reference rate expected to be discontinued because of reference rate reform.

The amendments in this update are elective and were effective for the Company immediately upon issuance.

The Company is currently assessing the impact of the transition from U.S.

dollar LIBOR to alternative reference rates but does not expect this new standard to have a material impact on its Consolidated Financial Statements.

Recently issued accounting guidance not discussed above is not applicable or did not have, or is not expected to have, a material impact to the Company.

This guidance was effective for the Company beginning in the first quarter of fiscal year 2021.

The adoption of this standard did not have a material impact on the Company’s Consolidated Financial Statements.

Recently Issued Accounting Guidance

Recently issued accounting guidance is not applicable or did not have, or is not expected to have, a material impact to the Company.

Form 10-K Summary

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SCHEDULE OF VALUATION AND QUALIFYING ACCOUNTS

(in thousands)

Additions and

Charged to Costs

to Other Accounts

End of Period

Allowance for uncollectible accounts receivable:

Fiscal year ended August 31, 2020

Fiscal year ended August 31, 2019

Fiscal year ended August 31, 2018

(in millions)

Additions and

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Fiscal year ended August 31, 2019

See accompanying report of independent registered public accounting firm.

See accompanying report of independent registered public accounting

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 9A. Controls and Procedures