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Document and Entity Information	9 Months Ended
Document and Entity Information	May 31, 2018 shares
Document and Entity Information [Abstract]
Entity Registrant Name	Walgreens Boots Alliance, Inc.
Entity Central Index Key	0001618921
Current Fiscal Year End Date	--08-31
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding (in shares)	992,411,822
Document Fiscal Year Focus	2018
Document Fiscal Period Focus	Q3
Document Type	10-Q
Amendment Flag	false
Document Period End Date	May 31, 2018

CONSOLIDATED CONDENSED BALANCE SHEETS (UNAUDITED) - USD ($) $ in Millions	May 31, 2018	Aug. 31, 2017
Current assets:
Cash and cash equivalents	$ 1,818	$ 3,301
Accounts receivable, net (see note 18)	7,159	6,528
Inventories	9,889	8,899
Other current assets	1,122	1,025
Total current assets	19,988	19,753
Non-current assets:
Property, plant and equipment, net	13,938	13,642
Goodwill	17,089	15,632
Intangible assets, net	12,111	10,156
Equity method investments (see note 5)	6,272	6,320
Other non-current assets	754	506
Total non-current assets	50,164	46,256
Total assets	70,152	66,009
Current liabilities:
Short-term debt	2,587	251
Trade accounts payable (see note 16)	13,089	12,494
Accrued expenses and other liabilities	5,435	5,473
Income taxes	371	329
Total current liabilities	21,482	18,547
Non-current liabilities:
Long-term debt	12,456	12,684
Deferred income taxes	1,973	2,281
Other non-current liabilities	5,771	4,223
Total non-current liabilities	20,200	19,188
Commitments and contingencies (see note 10)
Equity:
Preferred stock $.01 par value; authorized 32 million shares, none issued	0	0
Common stock $.01 par value; authorized 3.2 billion shares; issued 1,172,513,618 at May 31, 2018 and August 31, 2017	12	12
Paid-in capital	10,444	10,339
Retained earnings	32,460	30,137
Accumulated other comprehensive loss	(2,792)	(3,051)
Treasury stock, at cost; 180,101,796 shares at May 31, 2018 and 148,664,548 at August 31, 2017	(12,388)	(9,971)
Total Walgreens Boots Alliance, Inc. shareholders’ equity	27,736	27,466
Noncontrolling interests	734	808
Total equity	28,470	28,274
Total liabilities and equity	$ 70,152	$ 66,009

CONSOLIDATED CONDENSED BALANCE SHEETS (UNAUDITED) (Parenthetical) - $ / shares	May 31, 2018	Aug. 31, 2017
Equity:
Preferred stock, par value (in dollars per share)	$ 0.01	$ 0.01
Preferred stock, authorized (in shares)	32,000,000	32,000,000
Preferred stock, issued (in shares)	0	0
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, authorized shares (in shares)	3,200,000,000	3,200,000,000
Common stock, issued (in shares)	1,172,513,618	1,172,513,618
Treasury stock, at cost (in shares)	180,101,796	148,664,548

CONSOLIDATED CONDENSED STATEMENTS OF EQUITY (UNAUDITED) - USD ($) $ in Millions	Total	Common stock shares	Treasury stock amount	Paid-in capital	Employee stock loan receivable	Accumulated other comprehensive (loss) income	Retained earnings	Noncontrolling interests
Beginning Balance at Aug. 31, 2016	$ 30,281	$ 12	$ (4,934)	$ 10,111	$ (1)	$ (2,992)	$ 27,684	$ 401
Beginning Balance (in shares) at Aug. 31, 2016		1,082,986,591
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net earnings	3,294						3,276	18
Other comprehensive income (loss), net of tax	(349)					(311)		(38)
Dividends declared	(1,228)						(1,216)	(12)
Treasury stock purchases	(1,457)		(1,457)
Treasury stock purchases (in shares)		(17,419,955)
Employee stock purchase and option plans	176		149	26	1
Employee stock purchase and option plans (in shares)		4,529,850
Stock-based compensation	71			71
Noncontrolling interests contribution	696			181				515
Ending Balance at May. 31, 2017	31,484	$ 12	(6,242)	10,389	0	(3,303)	29,744	884
Ending Balance (in shares) at May. 31, 2017		1,070,096,486
Beginning Balance at Feb. 28, 2017						(3,809)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net earnings	1,165
Ending Balance at May. 31, 2017	31,484	$ 12	(6,242)	10,389	0	(3,303)	29,744	884
Ending Balance (in shares) at May. 31, 2017		1,070,096,486
Beginning Balance at Aug. 31, 2017	28,274	$ 12	(9,971)	10,339	0	(3,051)	30,137	808
Beginning Balance (in shares) at Aug. 31, 2017		1,023,849,070
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net earnings	3,517						3,512	5
Other comprehensive income (loss), net of tax	266					259		7
Dividends declared	(1,275)						(1,189)	(86)
Treasury stock purchases	(2,525)		(2,525)
Treasury stock purchases (in shares)		(34,499,913)
Employee stock purchase and option plans	118		108	10
Employee stock purchase and option plans (in shares)		3,062,665
Stock-based compensation	91			91
Noncontrolling interests contribution	4			4
Ending Balance at May. 31, 2018	28,470	$ 12	(12,388)	10,444	0	(2,792)	32,460	734
Ending Balance (in shares) at May. 31, 2018		992,411,822
Beginning Balance at Feb. 28, 2018						(2,163)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net earnings	1,346
Ending Balance at May. 31, 2018	$ 28,470	$ 12	$ (12,388)	$ 10,444	$ 0	$ (2,792)	$ 32,460	$ 734
Ending Balance (in shares) at May. 31, 2018		992,411,822

CONSOLIDATED CONDENSED STATEMENTS OF EARNINGS (UNAUDITED) - USD ($) shares in Millions, $ in Millions	3 Months Ended		9 Months Ended
	May 31, 2018	May 31, 2017	May 31, 2018	May 31, 2017
Income Statement [Abstract]
Sales	$ 34,334	$ 30,118	$ 98,095	$ 88,065
Cost of sales	26,554	22,973	74,878	66,243
Gross profit	7,780	7,145	23,217	21,822
Selling, general and administrative expenses	6,231	5,712	18,456	17,522
Equity earnings in AmerisourceBergen	52	84	142	143
Operating income	1,601	1,517	4,903	4,443
Other income (expense)	(4)	(8)	(132)	(22)
Earnings before interest and income tax provision	1,597	1,509	4,771	4,421
Interest expense, net	157	155	457	500
Earnings before income tax provision	1,440	1,354	4,314	3,921
Income tax provision	109	168	839	634
Post tax earnings (loss) from other equity method investments	15	(21)	42	7
Net earnings	1,346	1,165	3,517	3,294
Net earnings attributable to noncontrolling interests	4	3	5	18
Net earnings attributable to Walgreens Boots Alliance, Inc.	$ 1,342	$ 1,162	$ 3,512	$ 3,276
Net earnings per common share:
Basic (in dollars per share)	$ 1.35	$ 1.08	$ 3.52	$ 3.03
Diluted (in dollars per share)	1.35	1.07	3.51	3.02
Dividends declared per share (in dollars per share)	$ 0.40	$ 0.3750	$ 1.20	$ 1.1250
Weighted average common shares outstanding:
Basic (in shares)	992.1	1,077.1	996.4	1,079.6
Diluted (in shares)	995.3	1,082.6	1,000.6	1,085.5

CONSOLIDATED CONDENSED STATEMENTS OF COMPREHENSIVE INCOME (UNAUDITED) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	May 31, 2018	May 31, 2017	May 31, 2018	May 31, 2017
Comprehensive income:
Net earnings	$ 1,346	$ 1,165	$ 3,517	$ 3,294
Other comprehensive income (loss), net of tax:
Pension/postretirement obligations	(2)	5	(4)	1
Unrealized gain on cash flow hedges	1	1	2	3
Unrecognized loss on available-for-sale investments	0	(1)	0	(2)
Share of other comprehensive income (loss) of equity method investments	11	2	13	(3)
Currency translation adjustments	(652)	504	255	(348)
Total other comprehensive income (loss)	(642)	511	266	(349)
Total comprehensive income	704	1,676	3,783	2,945
Comprehensive income (loss) attributable to noncontrolling interests	(9)	8	12	(20)
Comprehensive income attributable to Walgreens Boots Alliance, Inc.	$ 713	$ 1,668	$ 3,771	$ 2,965

CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (UNAUDITED) - USD ($) $ in Millions	9 Months Ended
	May 31, 2018	May 31, 2017
Cash flows from operating activities:
Net earnings	$ 3,517	$ 3,294
Adjustments to reconcile net earnings to net cash provided by operating activities:
Depreciation and amortization	1,300	1,244
Deferred income taxes	(382)	(211)
Stock compensation expense	91	71
Equity earnings from equity method investments	(184)	(150)
Other	266	289
Changes in operating assets and liabilities:
Accounts receivable, net	(762)	(153)
Inventories	230	259
Other current assets	(4)	22
Trade accounts payable	627	821
Accrued expenses and other liabilities	10	(268)
Income taxes	793	6
Other non-current assets and liabilities	(117)	13
Net cash provided by operating activities	5,385	5,237
Cash flows from investing activities:
Additions to property, plant and equipment	(983)	(912)
Proceeds from sale-leaseback transactions	0	436
Proceeds from sale of other assets	221	39
Business and intangible asset acquisitions, net of cash acquired	(4,220)	(63)
Other	(129)	48
Net cash used for investing activities	(5,111)	(452)
Cash flows from financing activities:
Net change in short-term debt with maturities of 3 months or less	596	277
Proceeds from debt	5,043	0
Payments of debt	(3,507)	(40)
Stock purchases	(2,525)	(1,457)
Proceeds related to employee stock plans	118	174
Cash dividends paid	(1,291)	(1,228)
Other	(217)	(59)
Net cash used for financing activities	(1,783)	(2,333)
Effect of exchange rate changes on cash and cash equivalents	26	(6)
Changes in cash and cash equivalents:
Net (decrease) increase in cash and cash equivalents	(1,483)	2,446
Cash and cash equivalents at beginning of period	3,301	9,807
Cash and cash equivalents at end of period	$ 1,818	$ 12,253

Accounting policies	9 Months Ended
Accounting policies	May 31, 2018
Accounting Policies [Abstract]
Accounting policies	Accounting policies Basis of presentation The Consolidated Condensed Financial Statements of Walgreens Boots Alliance, Inc. (“Walgreens Boots Alliance” or the “Company”) included herein have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission regarding interim financial reporting. The Consolidated Condensed Financial Statements include all subsidiaries in which the Company holds a controlling interest. Investments in less than majority-owned subsidiaries in which the Company does not have a controlling interest, but does have significant influence, are accounted for as equity method investments. All intercompany transactions have been eliminated. The Consolidated Condensed Financial Statements included herein are unaudited. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) have been condensed or omitted pursuant to such rules and regulations, although the Company believes that the disclosures are adequate to make the information presented not misleading. These unaudited Consolidated Condensed Financial Statements should be read in conjunction with the audited financial statements and the notes thereto included in the Walgreens Boots Alliance Annual Report on Form 10-K for the fiscal year ended August 31, 2017. In the opinion of management, the unaudited Consolidated Condensed Financial Statements for the interim periods presented include all adjustments (consisting only of normal recurring adjustments) necessary to present a fair statement of the results for such interim periods. The influence of certain holidays, seasonality, foreign currency rates, changes in vendor, payer and customer relationships and terms, strategic transactions including acquisitions, changes in laws, and general economic conditions in the markets in which the Company operates, and other factors on the Company’s operations and net earnings for any period may not be comparable to the same period in previous years. With respect to the Company’s Retail Pharmacy USA segment, the positive impact on gross profit margins and gross profit dollars typically has been significant in the first several months after a generic version of a drug is first allowed to compete with the branded version, which is generally referred to as a “generic conversion”. In any given year, the number of major brand name drugs that undergo a conversion from branded to generic status can increase or decrease, which can have a significant impact on the Company’s Retail Pharmacy USA segment’s sales, gross profit margins and gross profit dollars making the Company’s operations or net earnings for any period incomparable.

Acquisitions

9 Months Ended

May 31, 2018

Business Combinations [Abstract]

Acquisitions

Acquisition of certain Rite Aid Corporation (“Rite Aid”) assets

On September 19, 2017, the Company announced that it had secured regulatory clearance for an amended and restated asset purchase agreement to purchase 1,932 stores, three distribution centers and related inventory from Rite Aid for $4.375 billion in cash and other consideration. The purchases of these stores have been accounted for as business combinations and occurred in waves during fiscal 2018. The Company purchased 390 stores for total cash consideration of $820 million for the three months ended May 31, 2018 and 1,932 stores for total cash consideration of $4.2 billion for the nine months ended May 31, 2018. The transition of the three distribution centers and related inventory is expected to begin during fiscal 2019 and remains subject to closing conditions set forth in the amended and restated asset purchase agreement.

As of May 31, 2018, the Company had not completed the analysis to assign fair values to all tangible and intangible assets acquired and therefore the purchase price allocation has not been finalized. The preliminary purchase price allocation will be subject to further refinement and may result in material changes. These changes will primarily relate to the allocation of consideration and the fair value assigned to all tangible and intangible assets acquired and identified. During the three months ended May 31, 2018, the Company recorded certain measurement period adjustments to identified assets acquired and liabilities assumed based on additional information regarding such assets and liabilities, which did not have a material impact on the purchase price allocation. The following table summarizes the consideration for the purchases and the preliminary amounts of identified assets acquired and liabilities assumed as of the nine months ended May 31, 2018.



Consideration	$	4,330

Identifiable assets acquired and liabilities assumed
Inventories	$	1,291
Property, plant and equipment	494
Intangible assets	2,028
Accrued expenses and other liabilities	(54		)
Deferred income taxes	5
Other non-current liabilities	(795		)
Total identifiable net assets	2,969
Goodwill	$	1,361

The preliminary identified definite-lived intangible assets were as follows:



Definite-lived intangible assets	Weighted-average useful life (in years)	Amount (in millions)
Customer relationships	12	$	1,850
Favorable lease interests	6	158
Trade names and trademarks	2	20
Total		$	2,028

Consideration includes cash of $4,157 million and the fair value of the option granted to Rite Aid to become a member of the Company’s group purchasing organization, Walgreens Boots Alliance Development GmbH. The fair value for this option was determined using the income approach methodology. The fair value estimates are based on the market compensation for such services and appropriate discount rate, as relevant, that market participants would consider when estimating fair values.

The goodwill of $1,361 million arising from the business combinations primarily reflects the expected operational synergies and cost savings generated from the Store Optimization Program as well as the expected growth from new customers. See note 3, exit and disposal activities, for additional information. The goodwill was allocated to the Retail Pharmacy USA segment. Substantially all of the goodwill recognized is expected to be deductible for income tax purposes.

The fair value for customer relationships was determined using the multi-period excess earnings method, a form of the income approach. Real property fair values were determined using primarily the income approach and sales comparison approach. The fair value measurements of the intangible assets are based on significant inputs not observable in the market, and thus represent Level 3 measurements. The fair value estimates for the intangible assets are based on projected discounted cash flows, historical and projected financial information, and attrition rates, as relevant, that market participants would consider when estimating fair values.

The following table presents supplemental unaudited condensed pro forma consolidated sales for the three and nine months ended May 31, 2018 and 2017 as if all 1,932 stores acquired under the amended and restated asset purchase agreement had occurred on September 1, 2016. Pro forma net earnings of the Company, assuming these purchases had occurred at the beginning of each period presented, would not be materially different from the results reported. See note 3, exit and disposal activities, for additional information. The unaudited condensed pro forma information has been prepared for comparative purposes only and is not intended to be indicative of what the Company’s results would have been had the purchases occurred at the beginning of the periods presented or results which may occur in the future.



	Three months ended May 31,				Nine months ended May 31,
(in millions)	2018		2017		2018		2017
Sales	$	34,366	$	32,496	$	102,059	$	95,378

Actual sales from acquired Rite Aid stores for the three and nine months ended May 31, 2018 included in the Consolidated Statement of Earnings are as follows:



(in millions)	Three months ended May 31, 2018		Nine months ended May 31, 2018
Sales	$	2,223	$	3,038

The 1,932 Rite Aid stores acquired did not have a material impact on net earnings of the Company for the three and nine months ended May 31, 2018.

AllianceRx Walgreens Prime

On March 31, 2017, Walgreens Boots Alliance and pharmacy benefit manager Prime Therapeutics LLC (“Prime”) closed a transaction to form a combined central specialty pharmacy and mail services company AllianceRx Walgreens Prime, as part of a strategic alliance. AllianceRx Walgreens Prime is consolidated by Walgreens Boots Alliance and reported within the Retail Pharmacy USA division in its financial statements. The Company accounted for this acquisition of Prime’s specialty pharmacy and mail services business as a business combination involving noncash purchase consideration of $720 million consisting of the issuance of an equity interest in AllianceRx Walgreens Prime.

The Company has completed the purchase accounting for the AllianceRx Walgreens Prime transaction. The following table summarizes the consideration for the acquisition and the amounts of identified assets acquired and liabilities assumed at the date of the transaction (in millions).



Consideration	$	720

Identifiable assets acquired and liabilities assumed
Accounts receivable	$	217
Inventories	149
Property, plant and equipment	11
Intangible assets	331
Trade accounts payable	(90		)
Accrued expenses and other liabilities	(1		)
Total identifiable net assets	617
Goodwill	$	103

The identified intangible assets primarily include purchasing and payer contracts. These contracts are estimated to have a weighted average useful life of 15 years. The goodwill of $103 million arising from the transaction consists of expected purchasing synergies, operating efficiencies by benchmarking performance and applying best practices across the combined company, consolidation of operations, reductions in selling, general and administrative expenses and combining workforces. Substantially all of the goodwill recognized is not expected to be deductible for income tax purposes.

In accordance with ASC Topic 810, Consolidation, the noncontrolling interest was recognized based on its proportionate interest in the identifiable net assets of AllianceRx Walgreens Prime. The difference between the carrying amount of the noncontrolling interest and the fair value recognized as consideration in the business combination is recognized as additional paid in capital.

Exit and disposal activities

9 Months Ended

May 31, 2018

Restructuring and Related Activities [Abstract]

Exit and disposal activities

On October 24, 2017, the Company’s Board of Directors approved a plan to implement a program (the “Store Optimization Program”) as part of an initiative to optimize store locations within the Company’s Retail Pharmacy USA segment upon completion of the acquisition of certain stores and related assets from Rite Aid. The Store Optimization Program includes plans to close approximately 600 stores and related assets across the U.S. The actions under the Store Optimization Program commenced in March 2018 and are expected to take place over an 18 month period.

The Company currently estimates that it will recognize cumulative pre-tax charges to its GAAP financial results of approximately $450 million, including costs associated with lease obligations and other real estate costs, employee severance and other exit costs. The Company expects to incur pre-tax charges of approximately $270 million for lease obligations and other real estate costs and approximately $180 million for employee severance and other exit costs. The Company estimates that substantially all of these cumulative pre-tax charges will result in cash expenditures.

Costs related to the Store Optimization Program, which were primarily recorded in selling, general and administrative expenses for the Company's Retail Pharmacy USA segment included in the three and nine months ended May 31, 2018, are as follows (in millions):



Three months ended May 31, 2018
Lease obligations and other real estate costs	2
Employee severance and other exit costs	22
Total costs	$	24



Nine months ended May 31, 2018
Lease obligations and other real estate costs	2
Employee severance and other exit costs	22
Total costs	$	24

The changes in liabilities related to the Store Optimization Program for the nine months ended May 31, 2018 include the following (in millions):



	Lease obligations and other real estate costs		Employee severance and other exit costs			Total
Balance at August 31, 2017	$	—	$	—		$	—
Costs	2		22			24
Payments	—		(8		)	(8		)
Other - non cash¹	30		—			30
Balance at May 31, 2018	$	32	$	14		$	46


¹	Represents unfavorable lease liabilities from acquired Rite Aid stores.

On April 8, 2015, the Walgreens Boots Alliance Board of Directors approved a plan to implement a restructuring program (the “Cost Transformation Program”) as part of an initiative to reduce costs and increase operating efficiencies. The Cost Transformation Program implemented and built on the cost-reduction initiative previously announced by the Company on August 6, 2014 and included plans to close stores across the U.S.; reorganize corporate and field operations; drive operating efficiencies; and streamline information technology and other functions. The actions under the Cost Transformation Program focused primarily on the Retail Pharmacy USA segment, but included activities from all segments. The Company completed the Cost Transformation Program in the fourth quarter of fiscal 2017.

The changes in liabilities related to the Cost Transformation Program for the nine months ended May 31, 2018 include the following (in millions):



	Real estate costs			Severance and other business transition and exit costs			Total
Balance at August 31, 2017	$	521		$	79		$	600
Payments	(112		)	(68		)	(180		)
Other - non cash	20			(1		)	19
Currency translation adjustments	—			(1		)	(1		)
Balance at May 31, 2018	$	429		$	9		$	438

Total costs by segment, which were primarily recorded in selling, general and administrative expenses included in the three and nine months ended May 31, 2017, are as follows (in millions):



Three months ended May 31, 2017	Retail Pharmacy USA		Retail Pharmacy International		Pharmaceutical Wholesale		Walgreens Boots Alliance, Inc.
Asset impairments	$	96	$	18	$	—	$	114
Real estate costs	15		—		—		15
Severance and other business transition and exit costs	18		8		16		42
Total costs	$	129	$	26	$	16	$	171



Nine months ended May 31, 2017	Retail Pharmacy USA		Retail Pharmacy International		Pharmaceutical Wholesale		Walgreens Boots Alliance, Inc.
Asset impairments	$	207	$	21	$	1	$	229
Real estate costs	264		—		—		264
Severance and other business transition and exit costs	46		30		23		99
Total costs	$	517	$	51	$	24	$	592

Operating leases

9 Months Ended

May 31, 2018

Leases [Abstract]

Operating leases

Initial terms for leased premises in the U.S. are typically 15 to 25 years, followed by additional terms containing renewal options at five-year intervals, and may include rent escalation clauses. Non-U.S. leases are typically for shorter terms and may include cancellation clauses or renewal options. The commencement date of all lease terms is the earlier of the date the Company becomes legally obligated to make rent payments or the date the Company has the right to control the property. The Company recognizes rent expense on a straight-line basis over the term of the lease. In addition to minimum fixed rentals, some leases provide for contingent rentals based upon a portion of sales.

The Company continuously evaluates its real estate portfolio in conjunction with its capital needs. Historically, the Company has entered into several sale-leaseback transactions. For the nine months ended May 31, 2018, the Company did not record any proceeds from sale-leaseback transactions. For the nine months ended May 31, 2017, the Company recorded proceeds from sale-leaseback transactions of $436 million.

The Company provides for future costs related to closed locations. The liability is based on the present value of future rent obligations and other related costs (net of estimated sublease rent) to the first lease option date. During the three and nine months ended May 31, 2018, the Company recorded charges of $21 million and $88 million for facilities that were closed. This compares to $25 million and $289 million for the three and nine months ended May 31, 2017. These charges are reported in selling, general and administrative expenses in the Consolidated Condensed Statements of Earnings.

The changes in reserve for facility closings and related lease termination charges primarily in other non-current liabilities, include the following (in millions):



	For the nine months ended May 31, 2018			For the twelve months ended August 31, 2017
Balance at beginning of period	$	718		$	466
Provision for present value of non-cancellable lease payments on closed facilities	34			344
Changes in assumptions	7			13
Accretion expense	47			37
Other - non cash¹	30			—
Cash payments, net of sublease income	(159		)	(142		)
Balance at end of period	$	677		$	718


¹	Represents unfavorable lease liabilities from acquired Rite Aid stores.

As of May 31, 2018, the Company remains secondarily liable on 71 leases. The maximum potential undiscounted future payments are $311 million as of May 31, 2018.

Equity method investments

9 Months Ended

May 31, 2018

Equity Method Investments and Joint Ventures [Abstract]

Equity method investments

Equity method investments as of May 31, 2018 and August 31, 2017, are as follows (in millions, except percentages):



	May 31, 2018			August 31, 2017
	Carrying value		Ownership percentage	Carrying value		Ownership percentage
AmerisourceBergen	$	5,120	26%	$	5,024	26%
Others	1,152		8% - 50%	1,296		8% - 50%
Total	$	6,272		$	6,320

AmerisourceBergen investment

As of May 31, 2018 and August 31, 2017, the Company owned 56,854,867 AmerisourceBergen Corporation (“AmerisourceBergen”) common shares, representing approximately 26% of the outstanding AmerisourceBergen common stock. The Company accounts for its equity investment in AmerisourceBergen using the equity method of accounting, with the net earnings attributable to the Company’s investment being classified within the operating income of its Pharmaceutical Wholesale segment. Due to the timing and availability of financial information of AmerisourceBergen, the Company accounts for this equity method investment on a financial reporting lag of two months. Equity earnings from AmerisourceBergen are reported as a separate line in the Consolidated Condensed Statements of Earnings. The level 1 fair market value of the Company’s equity investment in AmerisourceBergen common stock at May 31, 2018 is $4.7 billion.

As of May 31, 2018, the Company’s investment in AmerisourceBergen carrying value exceeded its proportionate share of the net assets of AmerisourceBergen by $4.2 billion. This premium of $4.2 billion was recognized as part of the carrying value in the Company’s equity investment in AmerisourceBergen. The difference was primarily related to goodwill and the fair value of AmerisourceBergen intangible assets.

Other investments

The Company’s other equity method investments include its investments in Guangzhou Pharmaceuticals Corporation (“Guangzhou Pharmaceuticals”) and Nanjing Pharmaceutical Corporation Limited, the Company’s pharmaceutical wholesale investments in China; and the equity method investment retained through the sale of a majority interest in Option Care Inc. in fiscal 2015.

The Company reported $15 million of post-tax equity earnings and $21 million of post-tax equity losses from other equity method investments for the three months ended May 31, 2018 and May 31, 2017, respectively. The Company reported $42 million and $7 million of post-tax equity earnings from other equity method investments for the nine months ended May 31, 2018 and May 31, 2017, respectively. During the nine month period ended May 31, 2018, the Company recorded an impairment of $170 million in its equity interest in Guangzhou Pharmaceuticals, which was included in other income (expense) in the Consolidated Condensed Statements of Earnings. The fair value of the Company’s equity interest in Guangzhou Pharmaceuticals was determined using the proposed sale price and thus represents Level 3 measurement. During the three months ended May 31, 2018, the Company completed the sale of a 30 percent interest in Guangzhou Pharmaceuticals to its joint venture partner Guangzhou Baiyunshan Pharmaceutical Holdings resulting in a $172 million reduction in carrying value and a $8 million cumulative translation adjustment loss.

Goodwill and other intangible assets

9 Months Ended

May 31, 2018

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and other intangible assets

Changes in the carrying amount of goodwill by reportable segment consist of the following (in millions):



	Retail Pharmacy USA		Retail Pharmacy International		Pharmaceutical Wholesale		Walgreens Boots Alliance, Inc.
Balance at August 31, 2017	$	9,139	$	3,392	$	3,101	$	15,632
Acquisitions	1,361		—		4		1,365
Currency translation adjustments	—		54		38		92
Balance at May 31, 2018	$	10,500	$	3,446	$	3,143	$	17,089

The carrying amount and accumulated amortization of intangible assets consist of the following (in millions):



	May 31, 2018		August 31, 2017
Gross amortizable intangible assets
Customer relationships and loyalty card holders ¹	$	4,331	$	2,510
Favorable lease interests and non-compete agreements	621		523
Trade names and trademarks	495		504
Purchasing and payer contracts	389		391
Total gross amortizable intangible assets	5,836		3,928

Accumulated amortization
Customer relationships and loyalty card holders ¹	$	930	$	780
Favorable lease interests and non-compete agreements	353		355
Trade names and trademarks	190		155
Purchasing and payer contracts	71		51
Total accumulated amortization	1,544		1,341
Total amortizable intangible assets, net	$	4,292	$	2,587

Indefinite lived intangible assets
Trade names and trademarks	$	5,696	$	5,514
Pharmacy licenses	2,123		2,055
Total indefinite lived intangible assets	$	7,819	$	7,569

Total intangible assets, net	$	12,111	$	10,156


¹	Includes purchased prescription files.

Amortization expense for intangible assets was $146 million and $363 million for the three and nine months ended May 31, 2018, respectively, and $98 million and $287 million for the three and nine months ended May 31, 2017, respectively.

Estimated future annual amortization expense for the next five fiscal years for intangible assets recorded at May 31, 2018 is as follows (in millions):



	2019		2020		2021		2022		2023
Estimated annual amortization expense	$	545	$	470	$	413	$	388	$	348

- Definition

The entire disclosure for the aggregate amount of goodwill and a description of intangible assets, which may include (a) for amortizable intangible assets (also referred to as finite-lived intangible assets), the carrying amount, the amount of any significant residual value, and the weighted-average amortization period, (b) for intangible assets not subject to amortization (also referred to as indefinite-lived intangible assets), the carrying amount, and (c) the amount of research and development assets acquired and written off in the period, including the line item in the income statement in which the amounts written off are aggregated, if not readily apparent from the income statement. Also discloses (a) for amortizable intangibles assets in total and by major class, the gross carrying amount and accumulated amortization, the total amortization expense for the period, and the estimated aggregate amortization expense for each of the five succeeding fiscal years, (b) for intangible assets not subject to amortization the carrying amount in total and by major class, and (c) for goodwill, in total and for each reportable segment, the changes in the carrying amount of goodwill during the period (including the aggregate amount of goodwill acquired, the aggregate amount of impairment losses recognized, and the amount of goodwill included in the gain (loss) on disposal of a reporting unit). If any part of goodwill has not been allocated to a reportable segment, discloses the unallocated amount and the reasons for not allocating. For each impairment loss recognized related to an intangible asset (excluding goodwill), discloses: (a) a description of the impaired intangible asset and the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method for determining fair value, (c) the caption in the income statement or the statement of activities in which the impairment loss is aggregated, and (d) the segment in which the impaired intangible asset is reported. For each goodwill impairment loss recognized, discloses: (a) a description of the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method of determining the fair value of the associated reporting unit, and (c) if a recognized impairment loss is an estimate not finalized and the reasons why the estimate is not final. May also disclose the nature and amount of any significant adjustments made to a previous estimate of an impairment loss.

+ References + Details

Debt

9 Months Ended

May 31, 2018

Debt Disclosure [Abstract]

Debt

Debt consist of the following (all amounts are presented in millions of U.S. dollars and debt issuances are denominated in U.S. dollars, unless otherwise noted)



	May 31, 2018		August 31, 2017
Short-term debt ¹
Commercial paper	1,039		—
Credit facilities ²	999		—
$1 billion note issuance ^3,4
5.250% unsecured notes due 2019 ⁵	248		—
Other ⁶	301		251
Total short-term debt	2,587		251

Long-term debt ¹
$6 billion note issuance ^3,7
3.450% unsecured notes due 2026	1,888		1,887
4.650% unsecured notes due 2046	590		590
$8 billion note issuance ^3,7
2.700% unsecured notes due 2019	1,247		1,246
3.300% unsecured notes due 2021	1,245		1,244
3.800% unsecured notes due 2024	1,989		1,988
4.500% unsecured notes due 2034	495		495
4.800% unsecured notes due 2044	1,492		1,492
£700 million note issuance ^3,7
2.875% unsecured Pound sterling notes due 2020	530		513
3.600% unsecured Pound sterling notes due 2025	397		384
€750 million note issuance ^3,7
2.125% unsecured Euro notes due 2026	869		884
$4 billion note issuance ^3,4
3.100% unsecured notes due 2022	1,195		1,195
4.400% unsecured notes due 2042	492		492
$1 billion note issuance ^3,4
5.250% unsecured notes due 2019 ⁵	—		250
Other ⁸	27		24
Total long-term debt, less current portion	$	12,456	$	12,684


¹	Carry values are presented net of unamortized discount and debt issuance costs, where applicable, and foreign currency denominated borrowings have been translated using spot rates at May 31, 2018 and August 31, 2017, respectively.

Credit facilities includes borrowings outstanding under the February 2017 Revolving Credit Agreement, the August 2017 Revolving Credit Agreement and the 2017 Term Loan Credit Agreement, which are described in more detail below. From time to time, the Company may also enter into other credit facilities, including in March 2018, a $350 million short-term unsecured revolving credit facility which was undrawn as of May 31, 2018.

The $6 billion, $8 billion, £0.7 billion, €0.75 billion, $4 billion and $1 billion note issuances as of May 31, 2018 had fair values and carrying values of $2.4 billion and $2.5 billion, $6.4 billion and $6.5 billion, $1.0 billion and $0.9 billion, $0.9 billion and $0.9 billion, $1.7 billion and $1.7 billion, and $0.3 billion and $0.2 billion, respectively. The fair values of the notes outstanding are level 1 fair value measures and determined based on quoted market price and translated at the May 31, 2018 spot rate, as applicable. The fair values and carrying values of these issuances do not include notes that have been redeemed or repaid as of May 31, 2018.

⁴

Notes are senior debt obligations of Walgreen Co. and rank equally with all other unsecured and unsubordinated indebtedness of Walgreen Co. On December 31, 2014, Walgreens Boots Alliance fully and unconditionally guaranteed the outstanding notes on an unsecured and unsubordinated basis. The guarantee, for so long as it is in place, is an unsecured, unsubordinated debt obligation of Walgreens Boots Alliance and will rank equally in right of payment with all other unsecured and unsubordinated indebtedness of Walgreens Boots Alliance.


⁵	Includes interest rate swap fair market value adjustments. See note 9, fair value measurements for additional fair value disclosures.


⁶	Other short-term debt represents a mix of fixed and variable rate borrowings with various maturities and working capital facilities denominated in various currencies.


⁷	Notes are unsubordinated debt obligations of Walgreens Boots Alliance and rank equally in right of payment with all other unsecured and unsubordinated indebtedness of Walgreens Boots Alliance from time to time outstanding.


⁸	Other long-term debt represents a mix of fixed and variable rate borrowings in various currencies with various maturities.

August 2017 Credit Agreements

On August 24, 2017, the Company entered into a $1.0 billion revolving credit agreement with the lenders from time to time party thereto (the “August 2017 Revolving Credit Agreement”) and a $1.0 billion term loan credit agreement with Sumitomo Mitsui Banking Corporation (the “2017 Term Loan Credit Agreement”).

The August 2017 Revolving Credit Agreement is an unsecured revolving credit facility with a facility termination date of the earlier of (a) January 31, 2019, subject to any extension thereof pursuant to the terms of the August 2017 Revolving Credit Agreement and (b) the date of termination in whole of the aggregate commitments provided by the lenders thereunder. As of May 31, 2018, there were no borrowings outstanding under the August 2017 Revolving Credit Agreement. The 2017 Term Loan Credit Agreement is an unsecured “multi-draw” term loan facility which matures on March 30, 2019. As of May 31, 2018, Walgreens Boots Alliance had $1.0 billion of borrowings outstanding under the 2017 Term Loan Credit Agreement, and no additional commitments were available.

February 2017 Revolving Credit Agreement

On February 1, 2017, the Company entered into a $1.0 billion revolving credit facility (as amended, the “February 2017 Revolving Credit Agreement”) with the lenders from time to time party thereto and, on August 1, 2017, the Company entered into an amendment agreement thereto. The terms and conditions of the February 2017 Revolving Credit Agreement were unchanged by the amendment other than the extension of the facility termination date to the earlier of (a) January 31, 2019 and (b) the date of termination in whole of the aggregate commitments provided by the lenders thereunder. As of May 31, 2018, there were no borrowings outstanding under the February 2017 Revolving Credit Agreement.

$6.0 billion note issuance

On June 1, 2016, Walgreens Boots Alliance received net proceeds of $6.0 billion from a public offering of five series of U.S. dollar notes with varying maturities and interest rates. Because the merger with Rite Aid was not consummated on or prior to June 1, 2017, the 2018 notes, the 2021 notes and the 2023 notes were redeemed on June 5, 2017 under the special mandatory redemption terms of the indenture governing such notes. Walgreens Boots Alliance was required to redeem all of the 2018 notes, the 2021 notes and the 2023 notes then outstanding, at a special mandatory redemption price equal to 101% of the aggregate principal amount of such notes, plus accrued and unpaid interest of approximately $1 million to, but excluding, the date of redemption. The 2026 notes and 2046 notes remain outstanding in accordance with their respective terms.

Debt covenants

Each of the Company’s credit facilities contain a covenant to maintain, as of the last day of each fiscal quarter, a ratio of consolidated debt to total capitalization not to exceed 0.60:1.00. The credit facilities contain various other customary covenants.

Commercial paper

The Company periodically borrows under its commercial paper program and may borrow under it in future periods. The Company had average daily short-term borrowings of $1.4 billion of commercial paper outstanding at a weighted average interest rate of 2.00% for the nine months ended May 31, 2018. The Company had no activity under its commercial paper program for the nine months ended May 31, 2017.

Interest

Interest paid was $450 million and $573 million for the nine months ended May 31, 2018 and May 31, 2017, respectively.

Financial instruments

9 Months Ended

May 31, 2018

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Financial instruments

The Company uses derivative instruments to manage its exposure to interest rate and foreign currency exchange risks.

The notional amounts, fair value and balance sheet presentation of derivative instruments outstanding as of May 31, 2018 and August 31, 2017 are as follows (in millions):



	May 31, 2018				August 31, 2017
	Notional ¹		Fair value		Notional ¹		Fair value		Location in Consolidated Condensed Balance Sheets
Derivatives designated as hedges:
Interest rate swaps	$	—	$	—	$	250	$	—	Other non-current assets
Interest rate swaps	250		2		—		—		Other current liabilities
Foreign currency forwards	28		—		24		—		Other current assets
Derivatives not designated as hedges:
Foreign currency forwards	$	3,762	$	147	$	221	$	—	Other current assets
Foreign currency forwards	—		—		2,816		19		Other current liabilities


¹	Amounts are presented in U.S. dollar equivalents, as applicable.

The Company uses interest rate swaps to manage the interest rate exposure associated with some of its fixed-rate borrowings and designates them as fair value hedges. From time to time, the Company may use forward starting interest rate swaps to hedge interest rate exposure of some or all of its anticipated debt issuances.

The Company utilizes foreign currency forward contracts and other foreign currency derivatives to hedge significant committed and highly probable future transactions and cash flows denominated in currencies other than the functional currency of the Company or its subsidiaries. The Company has significant non-U.S. dollar denominated net investments and uses foreign currency denominated financial instruments, specifically foreign currency derivatives and foreign currency denominated debt, to hedge its foreign currency risk.

Fair value hedges

The Company holds an interest rate swap converting $250 million of its 5.250% fixed rate notes to a floating interest rate based on the six-month LIBOR in arrears plus a constant spread. The swap termination date coincides with the January 15, 2019 maturity date of the notes. This swap was designated as a fair value hedge.

The gains and losses due to changes in fair value on the swaps and on the hedged notes attributable to interest rate risk did not have a material impact on the Company’s Financial Statements. The changes in fair value of the Company’s debt that was swapped from fixed to variable rate and designated as fair value hedges are included in long-term debt on the Consolidated Condensed Balance Sheets (see note 7, debt).

Derivatives not designated as hedges

The Company enters into derivative transactions that are not designated as accounting hedges. These derivative instruments are economic hedges of foreign currency risks. The income and (expense) due to changes in fair value of these derivative instruments were recognized in earnings as follows (in millions):



		Three months ended May 31,					Nine months ended May 31,
	Location in Consolidated Condensed Statements of Earnings	2018		2017			2018			2017
Foreign currency forwards	Selling, general and administrative expenses	$	108	$	(19	)	$	(75	)	$	28
Foreign currency forwards	Other income (expense)	3		(1		)	36			(15		)

Derivatives credit risk

Counterparties to derivative financial instruments expose the Company to credit-related losses in the event of counterparty nonperformance, and the Company regularly monitors the credit worthiness of each counterparty.

Derivatives offsetting

The Company does not offset the fair value amounts of derivative instruments subject to master netting agreements in the Consolidated Condensed Balance Sheets.

Fair value measurements

9 Months Ended

May 31, 2018

Fair Value Disclosures [Abstract]

Fair value measurements

The Company measures certain assets and liabilities in accordance with ASC Topic 820, Fair Value Measurements and Disclosures, which defines fair value as the price that would be received for an asset or paid to transfer a liability in an orderly transaction between market participants on the measurement date. In addition, it establishes a fair value hierarchy that prioritizes observable and unobservable inputs used to measure fair value into three broad levels:

Level 1 - Quoted prices in active markets that are accessible at the measurement date for identical assets and liabilities. The fair value hierarchy gives the highest priority to level 1 inputs.

Level 2 - Observable inputs other than quoted prices in active markets.

Level 3 - Unobservable inputs for which there is little or no market data available. The fair value hierarchy gives the lowest priority to level 3 inputs.

Assets and liabilities measured at fair value on a recurring basis are as follows (in millions):



	May 31, 2018		Level 1		Level 2		Level 3
Assets:
Money market funds¹	$	1,104	$	1,104	$	—	$	—
Available-for-sale investments²	1		1		—		—
Foreign currency forwards³	147		—		147		—
Liabilities:
Interest rate swaps⁴	2		—		2		—



	August 31, 2017		Level 1		Level 2		Level 3
Assets:
Money market funds¹	$	2,096	$	2,096	$	—	$	—
Available-for-sale investments²	1		1		—		—
Liabilities:
Foreign currency forwards³	19		—		19		—


¹	Money market funds are valued at the closing price reported by the fund sponsor.


²	The fair value of quoted investments are based on current bid prices as of the balance sheet dates.


³	The fair value of forward currency contracts are estimated by discounting the difference between the contractual forward price and the current available forward price for the residual maturity of the contract using observable market rates.


⁴	The fair value of interest rate swaps is calculated by discounting the estimated future cash flows based on the applicable observable yield curves. See note 8, financial instruments for additional information.

There were no transfers between levels for the three and nine months ended May 31, 2018.

The Company reports its debt instruments under the guidance of ASC Topic 825, Financial Instruments, which requires disclosure of the fair value of the Company’s debt in the footnotes to the Consolidated Financial Statements. Unless otherwise noted, the fair value for all notes was determined based upon quoted market prices and therefore categorized as level 1. See note 7, debt for further information. The carrying values of accounts receivable, net and trade accounts payable approximated their respective fair values due to their short-term nature.

- Definition

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

+ References + Details

Commitments and contingencies	9 Months Ended
Commitments and contingencies	May 31, 2018
Commitments and Contingencies Disclosure [Abstract]
Commitments and contingencies	Commitments and contingencies The Company is involved in legal proceedings and is subject to investigations, inspections, audits, inquiries and similar actions by governmental authorities, arising in the normal course of the Company’s business, including the matters described below. Legal proceedings, in general, and securities and class action litigation, in particular, can be expensive and disruptive. Some of these suits may purport or may be determined to be class actions and/or involve parties seeking large and/or indeterminate amounts, including punitive or exemplary damages, and may remain unresolved for several years. From time to time, the Company is also involved in legal proceedings as a plaintiff involving antitrust, tax, contract, intellectual property and other matters. Gain contingencies, if any, are recognized when they are realized. The results of legal proceedings are often uncertain and difficult to predict, and the costs incurred in litigation can be substantial, regardless of the outcome. The Company believes that its defenses and assertions in pending legal proceedings have merit, and does not believe that any of these pending matters, after consideration of applicable reserves and rights to indemnification, will have a material adverse effect on the Company’s consolidated financial position. However, substantial unanticipated verdicts, fines and rulings do sometimes occur. As a result, the Company could from time to time incur judgments, enter into settlements or revise its expectations regarding the outcome of certain matters, and such developments could have a material adverse effect on its results of operations in the period in which the amounts are accrued and/or its cash flows in the period in which the amounts are paid. On a quarterly basis, the Company assesses its liabilities and contingencies for outstanding legal proceedings and reserves are established on a case-by-case basis for those legal claims for which management concludes that it is probable that a loss will be incurred and that the amount of such loss can be reasonably estimated. Substantially all of these contingencies are subject to significant uncertainties and, therefore, determining the likelihood of a loss and/or the measurement of any loss can be complex. With respect to litigation and other legal proceedings where the Company has determined that a loss is reasonably possible, the Company is unable to estimate the amount or range of reasonably possible loss due to the inherent difficulty of predicting the outcome of and uncertainties regarding such litigation and legal proceedings. The Company’s assessments are based on estimates and assumptions that have been deemed reasonable by management, but that may prove to be incomplete or inaccurate, and unanticipated events and circumstances may occur that might cause the Company to change those estimates and assumptions. Therefore, it is possible that an unfavorable resolution of one or more pending litigation or other contingencies could have a material adverse effect on the Company’s Consolidated Financial Statements in a future fiscal period. Management’s assessment of current litigation and other legal proceedings, including the corresponding accruals, could change because of the discovery of facts with respect to legal actions or other proceedings pending against the Company which are not presently known. Adverse rulings or determinations by judges, juries, governmental authorities or other parties could also result in changes to management’s assessment of current liabilities and contingencies. Accordingly, the ultimate costs of resolving these claims may be substantially higher or lower than the amounts reserved. On December 29, 2014, a putative shareholder filed a derivative action in federal court in the Northern District of Illinois against certain current and former directors and officers of Walgreen Co., and Walgreen Co. as a nominal defendant, arising out of certain public statements the Company made regarding its former fiscal 2016 goals. The action asserts claims for breach of fiduciary duty, waste and unjust enrichment. On April 10, 2015, the defendants filed a motion to dismiss. On May 18, 2015, the case was stayed in light of a securities class action that was filed on April 10, 2015. After a ruling issued on September 30, 2016 in the securities class action, which is described below, on November 3, 2016, the Court entered a stipulation and order extending the stay until the securities case is fully resolved. On April 10, 2015, a putative shareholder filed a securities class action in federal court in the Northern District of Illinois against Walgreen Co. and certain former officers of Walgreen Co. The action asserts claims for violation of the federal securities laws arising out of certain public statements the Company made regarding its former fiscal 2016 goals. On June 16, 2015, the Court entered an order appointing a lead plaintiff. Pursuant to the Court’s order, lead plaintiff filed an amended complaint on August 17, 2015, and defendants moved to dismiss the amended complaint on October 16, 2015. Lead plaintiff filed a response to the motion to dismiss on December 22, 2015, and defendants filed a reply in support of the motion on February 5, 2016. On September 30, 2016, the Court issued an order granting in part and denying in part defendants’ motion to dismiss. Defendants filed their answer to the amended complaint on November 4, 2016 and filed an amended answer on January 16, 2017. Plaintiffs filed their motion for class certification on April 21, 2017. Plaintiffs’ motion was granted on March 29, 2018 and merits discovery is proceeding. As of August 31, 2017, the Company was aware of two putative class action lawsuits filed by purported Rite Aid stockholders against Rite Aid and its board of directors, Walgreens Boots Alliance and Victoria Merger Sub, Inc. for claims arising out of the transactions contemplated by the original Merger Agreement (prior to its amendment on January 29, 2017) (such transactions, the “Rite Aid Transactions”). One Rite Aid action was filed in the State of Pennsylvania in the Court of Common Pleas of Cumberland County (the “Pennsylvania action”), and one action was filed in the United States District Court for the Middle District of Pennsylvania (the “federal action”). The Pennsylvania action primarily alleged that the Rite Aid board of directors breached its fiduciary duties in connection with the Rite Aid Transactions by, among other things, agreeing to an unfair and inadequate price, agreeing to deal protection devices that preclude other bidders from making successful competing offers for Rite Aid, and failing to disclose all allegedly material information concerning the proposed merger, and also alleged that Walgreens Boots Alliance and Victoria Merger Sub, Inc. aided and abetted these alleged breaches of fiduciary duty. The federal action alleged, among other things, that Rite Aid and its board of directors disseminated an allegedly false and misleading proxy statement in connection with the Rite Aid Transactions. The plaintiffs in the federal action also filed a motion for preliminary injunction seeking to enjoin the Rite Aid shareholder vote relating to the Rite Aid Transactions. That motion was denied and plaintiffs agreed to stay the litigation until after the Rite Aid Transactions closed. On March 17, 2017, plaintiffs moved to lift the stay to allow plaintiffs to file an amended complaint. On August 4, 2017, that motion was granted for the limited purpose of allowing plaintiffs to file a motion seeking leave to amend their complaint in light of the termination of the Merger Agreement. Plaintiffs filed such a motion on September 22, 2017. The Company filed its response on October 6, 2017. The Court granted the motion on November 27, 2017, ordering the plaintiffs to file their amended complaint within 10 business days. Plaintiffs filed their amended complaint on December 11, 2017. Pursuant to a briefing schedule set by the Court, the Company filed a motion to dismiss on February 16, 2018. Plaintiffs filed their response brief on May 1, 2018 and reply briefs were filed on June 7, 2018. The Company was also named as a defendant in eight putative class action lawsuits filed in the Court of Chancery of the State of Delaware (the “Delaware actions”). Those actions were consolidated, and plaintiffs filed a motion for preliminary injunction seeking to enjoin the Rite Aid shareholder vote relating to the Rite Aid Transactions. That motion was denied and the plaintiffs in the Delaware actions agreed to settle this matter for an immaterial amount. The Delaware actions all have been dismissed. In December 2017, the United States Judicial Panel on Multidistrict Litigation consolidated numerous cases filed against an array of defendants by various plaintiffs such as counties, cities, hospitals, Indian tribes and others, alleging claims generally concerning the impacts of widespread opioid abuse. The consolidated multidistrict litigation, captioned In re National Prescription Opiate Litigation (MDL No. 2804), is pending in the U.S. District Court for the Northern District of Ohio. The Company is named as a defendant in a subset of the cases included in this multidistrict litigation. The Company also has been named as a defendant in several lawsuits brought in state courts relating to opioid matters. The relief sought by various plaintiffs is compensatory and punitive damages, as well as injunctive relief. Additionally, the Company has received from the Attorney Generals of several states subpoenas, civil investigative demands, and/or other requests concerning opioid matters.

Income taxes	9 Months Ended
Income taxes	May 31, 2018
Income Tax Disclosure [Abstract]
Income taxes	Income taxes The effective tax rate for the three and nine months ended May 31, 2018 was 7.6% and 19.4% respectively, compared to 12.4% and 16.2% for the three and nine months ended May 31, 2017. As further described below, the decrease in the effective tax rate for the three months ended and the increase in the effective tax rate for the nine months ended May 31, 2018 were significantly impacted by an additional provisional net tax benefit of $140 million and a provisional net tax expense of $44 million respectively, as a result of the U.S. tax law changes, which were enacted on December 22, 2017. The decrease in the prior year comparable periods are due to higher net discrete tax benefits. In addition, the Company's results for the three and nine months ended May 31, 2018 also include a net reduction to the Company’s estimated annual tax rate for the current year as a result of the U.S. tax law changes. Income taxes paid for the nine months ended May 31, 2018 were $428 million, compared to $839 million for the nine months ended May 31, 2017. U.S. tax law changes The United States government enacted comprehensive tax legislation in December 2017. The accounting guidance on income taxes generally requires the effects of new tax legislation to be recognized in the period of enactment. The SEC issued Staff Accounting Bulletin 118 (“SAB 118”), which provides for a measurement period of up to one year from the enactment date for companies to complete their accounting for the U.S. tax law changes. In accordance with the SEC staff guidance, companies must reflect the income tax effects of those aspects of the U.S. tax law changes for which the accounting is complete. To the extent a company’s accounting for the income tax effect of certain provisions of the U.S. tax law changes is incomplete but the Company is able to determine a reasonable estimate, a provisional estimate must be recorded in the Company’s financial statements. If companies cannot determine a provisional estimate for the effects of an aspect of the U.S. tax law changes, they should continue applying the accounting guidance on income taxes on the basis of the provisions of the tax laws in effect immediately before the U.S. tax law changes were enacted. The U.S. tax law changes include broad and complex changes affecting the Company’s fiscal 2018 results. Among other things, the U.S. tax law changes reduce the federal corporate tax rate from 35% to 21% effective January 1, 2018 and require companies to immediately accrue for and pay over an eight year period a one-time transition tax on certain un-repatriated earnings of foreign subsidiaries. The U.S. tax law changes also alter the taxation of foreign earnings, repeal of the deduction for domestic production activities and establish a global intangible low tax income (GILTI) regime, as well as base erosion anti-avoidance tax (BEAT). In connection with the Company’s ongoing analysis of the impact of the U.S. tax law changes, which is provisional and subject to change, the Company recorded a net tax expense of $44 million during the nine months ended May 31, 2018. This provisional net tax expense arises from the Company’s accrual for the transition tax and other U.S. tax law changes of $679 million, partly offset by a benefit of $635 million from re-measuring the Company’s net U.S. deferred tax liabilities. Based on the effective dates of certain aspects of the U.S. tax law changes as well as estimated data required to be used in the corresponding measurement calculations, the Company’s analysis of the income tax effects of the U.S. tax law changes could not be finalized as of May 31, 2018. While the Company made reasonable estimates of the impact of the transition tax and the remeasurement of its deferred tax assets and liabilities, the final impact of the U.S. tax law changes may differ from these estimates, due to, among other things, changes in its interpretations and assumptions, additional guidance and actions the Company may take. The Company expects to finalize such provisional amounts within the time period prescribed by SAB 118. The U.S. tax law changes created new rules that allow the Company to make an accounting policy election to either treat taxes due on future GILTI inclusions in taxable income as either a current period expense or reflect such inclusions related to temporary basis differences in the Company’s measurement of deferred taxes. The Company’s analysis of the new GILTI rules is not complete; therefore, the Company has not made a policy election regarding the tax accounting treatment of the GILTI tax. The U.S. tax law changes have the potential to change the Company’s assertions with respect to whether earnings of the Company’s foreign subsidiaries should remain indefinitely reinvested. The Company continues to evaluate these changes, therefore, the Company has not made any changes to its indefinite reinvestment assertions.

Retirement benefits

9 Months Ended

May 31, 2018

Retirement Benefits [Abstract]

Retirement benefits

The Company sponsors several retirement plans, including defined benefit plans, defined contribution plans and a postretirement health plan.

Defined benefit pension plans (non-U.S. plans)

The Company has various defined benefit pension plans outside the United States. The principal defined benefit pension plan is the Boots Pension Plan, which covers certain employees in the United Kingdom (the “Boots Plan”). The Boots Plan is a funded final salary defined benefit plan providing pensions and death benefits to members. The Boots Plan was closed to future accrual effective July 1, 2010, with pensions calculated based on salaries up until that date. The Boots Plan is governed by a trustee board, which is independent of the Company. The plan is subject to a full funding actuarial valuation on a triennial basis.

Components of net periodic pension costs for the defined benefit pension plans (in millions):



	Three months ended May 31,						Nine months ended May 31,
	2018			2017			2018			2017
Service costs	$	2		$	1		$	5		$	3
Interest costs	50			43			146			129
Expected returns on plan assets/other	(54		)	(41		)	(158		)	(112		)
Total net periodic pension costs	$	(2	)	$	3		$	(7	)	$	20

The Company made cash contributions to its defined benefit pension plans of $57 million for the nine months ended May 31, 2018, which primarily related to committed funded payments. The Company plans to contribute an additional $7 million to its defined benefit pension plans in fiscal 2018.

Defined contribution plans

The principal retirement plan for U.S. employees is the Walgreen Profit-Sharing Retirement Trust, to which both the Company and participating employees contribute. The Company’s contribution is in the form of a guaranteed match which is approved annually by the Walgreen Co. Board of Directors and reviewed by the Compensation Committee and Finance Committee of the Walgreens Boots Alliance Board of Directors. The profit-sharing provision was an expense of $53 million and $164 million for the three and nine months ended May 31, 2018 compared to an expense of $58 million and $164 million in the three and nine months ended May 31, 2017.

The Company also has certain contract based defined contribution arrangements. The principal one is the Alliance Healthcare & Boots Retirement Savings Plan, which is United Kingdom based and to which both the Company and participating employees contribute. The cost recognized in the Consolidated Condensed Statements of Earnings for the three and nine months ended May 31, 2018 was $33 million and $94 million compared to a cost of $26 million and $82 million in the three and nine months ended May 31, 2017.

Postretirement healthcare plan

The Company provides certain health insurance benefits to retired U.S. employees who meet eligibility requirements, including age, years of service and date of hire. The costs of these benefits are accrued over the service life of the employee. An amendment to this plan in the third quarter of fiscal 2017 resulted in a $109 million curtailment gain.

Earnings per share	9 Months Ended
Earnings per share	May 31, 2018
Earnings Per Share [Abstract]
Earnings per share	Earnings per share The dilutive effect of outstanding stock options on earnings per share is calculated using the treasury stock method. Stock options are anti-dilutive and excluded from the earnings per share calculation if the exercise price exceeds the average market price of the common shares. There were 12.1 million outstanding options to purchase common shares that were anti-dilutive and excluded from the third quarter earnings per share calculation as of May 31, 2018 compared to 6.4 million as of May 31, 2017. Anti-dilutive shares excluded from the year to date earnings per share calculation were 10.1 million for the period ended May 31, 2018 compared to 5.7 million for the period ended May 31, 2017.

Accumulated other comprehensive income (loss)

9 Months Ended

May 31, 2018

Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]

Accumulated other comprehensive income (loss)

The following is a summary of net changes in accumulated other comprehensive income by component and net of tax for the three and nine months ended May 31, 2018 and May 31, 2017 (in millions):



	Pension/ post- retirement obligations			Unrecognized gain (loss) on available-for- sale investments		Unrealized gain (loss) on cash flow hedges			Share of OCI of equity method investments			Currency translation adjustment			Total
Balance at February 28, 2018	$	(141	)	$	—	$	(32	)	$	—		$	(1,990	)	$	(2,163	)
Other comprehensive income (loss) before reclassification adjustments	—			—		—			3			(647		)	(644		)
Amounts reclassified from accumulated OCI	(2		)	—		1			11			8			18
Tax benefit (provision)	—			—		—			(3		)	—			(3		)
Net other comprehensive income (loss)	(2		)	—		1			11			(639		)	(629		)
Balance at May 31, 2018	$	(143	)	$	—	$	(31	)	$	11		$	(2,629	)	$	(2,792	)



	Pension/ post- retirement obligations			Unrecognized gain (loss) on available-for- sale investments		Unrealized gain (loss) on cash flow hedges			Share of OCI of equity method investments			Currency translation adjustment			Total
Balance at August 31, 2017	$	(139	)	$	—	$	(33	)	$	(2	)	$	(2,877	)	$	(3,051	)
Other comprehensive income (loss) before reclassification adjustments	(1		)	—		—			7			240			246
Amounts reclassified from accumulated OCI	(5		)	—		3			11			8			17
Tax benefit (provision)	2			—		(1		)	(5		)	—			(4		)
Net other comprehensive income (loss)	(4		)	—		2			13			248			259
Balance at May 31, 2018	$	(143	)	$	—	$	(31	)	$	11		$	(2,629	)	$	(2,792	)



	Pension/ post- retirement obligations			Unrecognized gain (loss) on available-for- sale investments			Unrealized gain (loss) on cash flow hedges			Share of OCI of equity method investments			Currency translation adjustment			Total
Balance at February 28, 2017	$	(216	)	$	1		$	(35	)	$	(6	)	$	(3,553	)	$	(3,809	)
Other comprehensive income (loss) before reclassification adjustments	(102		)	(1		)	—			4			499			400
Amounts reclassified from accumulated OCI¹	109			—			1			—			—			110
Tax benefit (provision)	(2		)	—			—			(2		)	—			(4		)
Net other comprehensive income (loss)	5			(1		)	1			2			499			506
Balance at May 31, 2017	$	(211	)	$	—		$	(34	)	$	(4	)	$	(3,054	)	$	(3,303	)



	Pension/ post- retirement obligations			Unrecognized gain (loss) on available-for- sale investments			Unrealized gain (loss) on cash flow hedges			Share of OCI of equity method investments			Currency translation adjustment			Total
Balance at August 31, 2016	$	(212	)	$	2		$	(37	)	$	(1	)	$	(2,744	)	$	(2,992	)
Other comprehensive income (loss) before reclassification adjustments	(107		)	(2		)	—			(4		)	(310		)	(423		)
Amounts reclassified from accumulated OCI¹	109			—			4			—			—			113
Tax benefit (provision)	(1		)	—			(1		)	1			—			(1		)
Net other comprehensive income (loss)	1			(2		)	3			(3		)	(310		)	(311		)
Balance at May 31, 2017	$	(211	)	$	—		$	(34	)	$	(4	)	$	(3,054	)	$	(3,303	)


¹	Includes amendment to U.S. postretirement healthcare plan resulting in a curtailment gain. See note 12, retirement benefits.

Segment reporting

9 Months Ended

May 31, 2018

Segment Reporting [Abstract]

Segment reporting

The Company has aligned its operations into three reportable segments: Retail Pharmacy USA, Retail Pharmacy International, and Pharmaceutical Wholesale. The operating segments have been identified based on the financial data utilized by the Company’s Chief Executive Officer (the chief operating decision maker) to assess segment performance and allocate resources among the Company’s operating segments, which have been aggregated as described below. The chief operating decision maker uses adjusted operating income to assess segment profitability. The chief operating decision maker does not use total assets by segment to make decisions regarding resources, therefore the total asset disclosure by segment has not been included.

•

The Retail Pharmacy USA segment consists of the Walgreens business, which includes the operation of retail drugstores and convenient care clinics; and operation of mail and central specialty pharmacy services. Sales for the segment are principally derived from the sale of prescription drugs and a wide assortment of retail products, including health and wellness, beauty, personal care and consumables and general merchandise.

•

The Retail Pharmacy International segment consists of pharmacy-led health and beauty retail businesses and optical practices. These businesses include Boots branded stores in the United Kingdom, Thailand, Norway, the Republic of Ireland and the Netherlands; Benavides in Mexico and Ahumada in Chile. Sales for the segment are principally derived from the sale of prescription drugs and health and wellness, beauty, personal care and other consumer products.

•

The Pharmaceutical Wholesale segment consists of the Alliance Healthcare pharmaceutical wholesaling and distribution businesses and an equity method investment in AmerisourceBergen. Wholesale operations are located in the United Kingdom, Germany, France, Turkey, Spain, the Netherlands, Egypt, Norway, Romania, Czech Republic and Lithuania. Sales for the segment are principally derived from wholesaling and distribution of a comprehensive offering of brand-name pharmaceuticals (including specialty pharmaceutical products) and generic pharmaceuticals, health and beauty products, home healthcare supplies and equipment, and related services to pharmacies and other healthcare providers.

The results of operations for each reportable segment include procurement benefits and an allocation of corporate-related overhead costs. The “Eliminations” column contains items not allocable to the reportable segments, as the information is not utilized by the chief operating decision maker to assess segment performance and allocate resources.

The following table reflects results of operations of the Company’s reportable segments (in millions):



	Retail Pharmacy USA		Retail Pharmacy International		Pharmaceutical Wholesale		Eliminations			Walgreens Boots Alliance, Inc.
Three months ended May 31, 2018
Sales to external customers	$	25,917	$	2,995	$	5,422	$	—		$	34,334
Intersegment sales	—		—		543		(543		)	—
Sales	$	25,917	$	2,995	$	5,965	$	(543	)	$	34,334

Adjusted operating income	$	1,492	$	198	$	257	$	—		$	1,947

Three months ended May 31, 2017
Sales to external customers	$	22,528	$	2,809	$	4,781	$	—		$	30,118
Intersegment sales	—		—		515		(515		)	—
Sales	$	22,528	$	2,809	$	5,296	$	(515	)	$	30,118

Adjusted operating income	$	1,463	$	193	$	253	$	5		$	1,914



	Retail Pharmacy USA		Retail Pharmacy International		Pharmaceutical Wholesale		Eliminations			Walgreens Boots Alliance, Inc.
Nine months ended May 31, 2018
Sales to external customers	$	72,884	$	9,395	$	15,816	$	—		$	98,095
Intersegment sales	—		—		1,622		(1,622		)	—
Sales	$	72,884	$	9,395	$	17,438	$	(1,622	)	$	98,095

Adjusted operating income	$	4,518	$	688	$	712	$	1		$	5,919

Nine months ended May 31, 2017
Sales to external customers	$	65,001	$	8,872	$	14,192	$	—		$	88,065
Intersegment sales	—		—		1,551		(1,551		)	—
Sales	$	65,001	$	8,872	$	15,743	$	(1,551	)	$	88,065

Adjusted operating income	$	4,304	$	648	$	703	$	1		$	5,656

The following table reconciles adjusted operating income to operating income (in millions):



	Retail Pharmacy USA		Retail Pharmacy International		Pharmaceutical Wholesale		Eliminations		Walgreens Boots Alliance, Inc.
Three months ended May 31, 2018
Adjusted operating income	$	1,492	$	198	$	257	$	—	$	1,947
Acquisition-related amortization									(131		)
Acquisition-related costs									(57		)
LIFO provision									(69		)
Adjustments to equity earnings in AmerisourceBergen									(60		)
Certain legal and regulatory accruals and settlements									(5		)
Store optimization									(24		)
Operating income									$	1,601

Three months ended May 31, 2017
Adjusted operating income	$	1,463	$	193	$	253	$	5	$	1,914
Acquisition-related amortization									(83		)
Acquisition-related costs									(29		)
LIFO provision									(97		)
Adjustments to equity earnings in AmerisourceBergen									(17		)
Cost transformation									(171		)
Operating income									$	1,517



	Retail Pharmacy USA		Retail Pharmacy International		Pharmaceutical Wholesale		Eliminations		Walgreens Boots Alliance, Inc.
Nine months ended May 31, 2018
Adjusted operating income	$	4,518	$	688	$	712	$	1	$	5,919
Acquisition-related amortization									(329		)
Acquisition-related costs									(173		)
LIFO provision									(166		)
Adjustments to equity earnings in AmerisourceBergen									(136		)
Certain legal and regulatory accruals and settlements									(120		)
Hurricane-related costs									(83		)
Store optimization									(24		)
Asset recovery									15
Operating income									$	4,903

Nine months ended May 31, 2017
Adjusted operating income	$	4,304	$	648	$	703	$	1	$	5,656
Acquisition-related amortization									(247		)
Acquisition-related costs									(75		)
LIFO provision									(204		)
Adjustments to equity earnings in AmerisourceBergen									(95		)
Cost transformation									(592		)
Operating income									$	4,443

Related parties

9 Months Ended

May 31, 2018

Related parties

The Company has a long-term pharmaceutical distribution agreement with AmerisourceBergen pursuant to which the Company sources branded and generic pharmaceutical products from AmerisourceBergen principally for its U.S. operations.

Related party transactions (in millions):



	Three months ended May 31,				Nine months ended May 31,
	2018		2017		2018		2017
Purchases, net	$	15,830	$	10,703	$	39,566	$	31,941



	May 31, 2018		August 31, 2017
Trade accounts payable, net	$	5,802	$	4,384

Additionally, AmerisourceBergen receives sourcing services for generic pharmaceutical products.

New accounting pronouncements

9 Months Ended

May 31, 2018

New Accounting Pronouncements and Changes in Accounting Principles [Abstract]

New accounting pronouncements

Adoption of new accounting pronouncements

Accounting for hedging activities

In August 2017, the FASB issued ASU 2017-12, Derivative and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities. This ASU expands an entity’s ability to hedge nonfinancial and financial risk components and reduces complexity in fair value hedges of interest rate risk. It eliminates the requirement to separately measure and report hedge ineffectiveness and generally requires the entire change in the fair value of a hedging instrument to be presented in the same income statement line as the hedged item. It also eases certain documentation and assessment requirements and modifies the accounting for components excluded from the assessment of hedge effectiveness. This ASU is effective for fiscal years beginning after December 15, 2018 (fiscal 2020), and interim periods within those fiscal years, with early adoption permitted. The Company early adopted this guidance during the third fiscal quarter of 2018. The adoption did not have any impact on the Company’s results of operations, cash flows or financial position. The updated accounting policy for financial instruments is as follows:

Financial instruments

The Company uses derivative instruments to hedge its exposure to interest rate and currency risks arising from operating and financing activities. In accordance with its risk management policies, the Company does not hold or issue derivative instruments for trading or speculative purposes.

Derivatives are recognized on the Consolidated Balance Sheets at their fair values. When the Company becomes a party to a derivative instrument and intends to apply hedge accounting, it formally documents the hedge relationship and the risk management objective for undertaking the hedge which includes designating the instrument for financial reporting purposes as a fair value hedge, a cash flow hedge, or a net investment hedge. The accounting for changes in fair value of a derivative instrument depends on whether the Company had designated it in a qualifying hedging relationship and on the type of hedging relationship. The Company applies the following accounting policies:


•	Changes in the fair value of a derivative designated as a fair value hedge, along with the gain or loss on the hedged asset or liability attributable to the hedged risk, are recorded in the Consolidated Statements of Earnings in the same line item - interest expense, net.


•	Changes in the fair value of a derivative designated as a cash flow hedge are recorded in accumulated other comprehensive income (loss) in the Consolidated Statements of Comprehensive Income and reclassified into earnings in the period or periods during which the hedged item affects earnings and is presented in the same line item as the earnings effect of the hedged item.

•

Changes in the fair value of a derivative designated as a hedge of a net investment in a foreign operation are recorded in cumulative translation adjustments within accumulated other comprehensive income (loss) in the Consolidated Statements of Comprehensive Income. Recognition in earnings of amounts previously recorded in cumulative translation adjustments is limited to circumstances such as complete or substantially complete liquidation of the net investment in the hedged investments in foreign operations.


•	Changes in the fair value of a derivative not designated in a hedging relationship are recognized in the Consolidated Statements of Earnings.

Cash receipts or payments on a settlement of a derivative contract are reported in the Consolidated Statements of Cash Flows consistent with the nature of the underlying hedged item.

For derivative instruments designated as hedges, the Company assesses, both at the hedge’s inception and on an ongoing basis, whether the derivatives that are used in hedging transactions are highly effective in offsetting changes in fair values or cash flows of hedged items. Highly effective means that cumulative changes in the fair value of the derivative are between 80% and 125% of the cumulative changes in the fair value of the hedged item. In addition, when the Company determines that a derivative is not highly effective as a hedge, hedge accounting is discontinued. When it is probable that a hedged forecasted transaction will not occur, the Company discontinues hedge accounting for the affected portion of the forecasted transaction, and reclassifies any gains or losses in accumulated other comprehensive income (loss) to earnings in the Consolidated Statements of Earnings when the hedged item affects earnings. When a derivative in a hedge relationship is terminated or the hedged item is sold, extinguished or terminated, hedge accounting is discontinued prospectively.

New accounting pronouncements not yet adopted

Accounting for reclassification of certain tax effects from accumulated other comprehensive income

In February 2018, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2018-02, Income Statement-Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income. This ASU addresses the income tax effects of items in accumulated other comprehensive income (“AOCI”) which were originally recognized in other comprehensive income, rather than in income from continuing operations. Specifically, it permits a reclassification from AOCI to retained earnings for the adjustment of deferred taxes due to the reduction of the historical corporate income tax rate to the newly enacted corporate income tax rate resulting from the U.S. tax law changes enacted in December 2017. It also requires certain disclosures about these reclassifications. This ASU is effective for fiscal years beginning after December 15, 2018 (fiscal 2020), and interim periods within those fiscal years, with early adoption permitted. The new guidance must be applied either on a prospective basis in the period of adoption or retrospectively to each period (or periods) in which the effect of the change in the U.S. federal corporate income tax rate in the U.S. tax law changes are recognized. The Company is evaluating the effect of adopting this new accounting guidance, but does not expect adoption will have a material impact on the Company’s financial position.

Presentation of net periodic pension cost and net periodic postretirement benefit cost

In March 2017, the FASB issued ASU 2017-07, Compensation - Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost. This ASU requires an employer to report the service cost component of net periodic pension cost and net periodic postretirement cost in the same line item in the statement of earnings as other compensation costs arising from services rendered by the related employees during the period. The other net cost components are required to be presented in the statement of earnings separately from the service cost component and outside a subtotal of income from operations. Additionally, the line item used in the statement of earnings to present the other net cost components must be disclosed in the notes to the financial statements. This ASU is effective for fiscal years beginning after December 15, 2017 (fiscal 2019), and interim periods within those fiscal years, and must be applied on a retrospective basis. The Company has evaluated the effect of adopting this new accounting guidance and determined that adoption will not have a material impact on the Company’s results of operations. The Company will adopt this new accounting guidance as of September 1, 2018 (fiscal 2019).

Restricted cash

In November 2016, the FASB issued ASU 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash. This ASU requires that a statement of cash flows explain the change during the period in the total of cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. Therefore, amounts generally described as restricted cash and restricted cash equivalents should be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the Statement of Cash Flows. This ASU is effective for fiscal years beginning after December 15, 2017 (fiscal 2019), and interim periods within those fiscal years, with early adoption permitted. The new guidance must be applied on a retrospective basis. The Company has evaluated the effect of adopting this new accounting guidance and determined that adoption will not have a material impact on the Company’s Statement of Cash Flows. The Company will adopt this new accounting guidance as of September 1, 2018 (fiscal 2019).

Tax accounting for intra-entity asset transfers

In October 2016, the FASB issued ASU 2016-16, Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory. Topic 740, Income Taxes, prohibits the recognition of current and deferred income taxes for an intra-entity asset transfer until the asset has been sold to an outside party. In addition, interpretations of this guidance have developed in practice for transfers of certain intangible and tangible assets. This prohibition on recognition is an exception to the principle of comprehensive recognition of current and deferred income taxes in GAAP. To more faithfully represent the economics of intra-entity asset transfers, the amendments in this ASU require that entities recognize the income tax consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs. The amendments in this ASU do not change GAAP for the pre-tax effects of an intra-entity asset transfer under Topic 810, Consolidation, or for an intra-entity transfer of inventory. This ASU is effective for fiscal years beginning after December 15, 2017 (fiscal 2019), including interim periods within those fiscal years, with early adoption permitted. The new guidance must be applied on a modified retrospective basis through a cumulative effect adjustment recognized directly to retained earnings as of the date of adoption. The Company is evaluating the effect of adopting this new accounting guidance. The Company will adopt this new accounting guidance as of September 1, 2018 (fiscal 2019).

Classification of certain cash receipts and cash payments

In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments. This ASU addresses the classification of certain specific cash flow issues including debt prepayment or extinguishment costs, settlement of certain debt instruments, contingent consideration payments made after a business combination, proceeds from the settlement of certain insurance claims and distributions received from equity method investees. This ASU is effective for fiscal years beginning after December 15, 2017 (fiscal 2019), and interim periods within those fiscal years, with early adoption permitted. An entity that elects early adoption must adopt all of the amendments in the same period and the new guidance must be applied on a retrospective basis. The Company has evaluated the effect of adopting this new accounting guidance and determined that adoption will not have a material impact on the Company’s Statement of Cash Flows. The Company will adopt this new accounting guidance as of September 1, 2018 (fiscal 2019).

Leases

In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), which supersedes Topic 840, Leases. Subsequently, the FASB has issued additional ASUs which further clarify this guidance. This ASU increases the transparency and comparability of organizations by requiring the capitalization of substantially all leases on the balance sheet and disclosures of key information about leasing arrangements. Under this new guidance, at the lease commencement date, a lessee recognizes a right-of-use asset and lease liability, which is initially measured at the present value of the future lease payments. For income statement purposes, a dual model was retained for lessees, requiring leases to be classified as either operating or finance leases. Under the operating lease model, lease expense is recognized on a straight-line basis over the lease term. Under the finance lease model, interest on the lease liability is recognized separately from amortization of the right-of-use asset. The new guidance is effective for fiscal years beginning after December 15, 2018 (fiscal 2020), and interim periods within those fiscal years. In transition, lessees are required to recognize and measure leases at the beginning of the earliest period presented (fiscal 2018) using a modified retrospective approach which includes a number of optional practical expedients that entities may elect to apply.

The Company will adopt this ASU on September 1, 2019 (fiscal 2020). The Company has begun evaluating and planning for adoption and implementation of this ASU, including implementing a new global lease accounting system, evaluating practical expedient and accounting policy elections, and assessing the overall financial statement impact. This ASU will have a material impact on the Company’s financial position. The impact on the Company’s results of operations is being evaluated. The impact of this ASU is non-cash in nature and will not affect the Company’s cash flows.

Classification and measurement of financial instruments

In January 2016, the FASB issued ASU 2016-01, Financial Instruments - Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities. Subsequently, the FASB has issued additional ASUs which further clarify this guidance. This ASU requires equity investments (except those under the equity method of accounting or those that result in the consolidation of an investee) to be measured at fair value with changes in fair value recognized in net income. However, an entity may choose to measure equity investments that do not have readily determinable fair values at cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer. This simplifies the impairment assessment of equity investments previous held at cost. Separate presentation of financial assets and liabilities by measurement category is required. This ASU is effective prospectively for fiscal years beginning after December 15, 2017 (fiscal 2019), and interim periods within those fiscal years. Early application is permitted, for fiscal years or interim periods that have not yet been issued as of the beginning of the fiscal year of adoption. The new guidance must be applied on a modified retrospective basis, with the exception of the amendments related to the measurement alternative for equity investments without readily determinable fair values, which must be applied on a prospective basis. The Company has evaluated the effect of adopting this new accounting guidance and determined that adoption will not have a material impact on the Company’s results of operations. The Company will adopt this new accounting guidance as of September 1, 2018 (fiscal 2019).

Revenue recognition on contracts with customers

In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606). This ASU provides a single principles-based revenue recognition model with a five-step analysis of transactions to determine when and how revenue is recognized. The core principle is that a company should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. Subsequently, the FASB has issued additional ASUs which further clarify this guidance and also defer the effective date by one year to fiscal years beginning after December 15, 2017 (fiscal 2019), and interim periods within those fiscal years. The Company continues to evaluate the impact of this ASU, the related amendments and the interpretive guidance on the Company's consolidated financial statements, and will use the modified retrospective method as the transition approach when adopting this new accounting guidance on September 1, 2018 (fiscal 2019). Based on the preliminary assessment, the impact of adopting the new guidance will not be material to the consolidated financial statements and will be limited to immaterial changes to the timing of recognition of revenues related to loyalty programs and gift cards, in addition to disaggregated revenue disclosures. Specifically, the Company currently uses the cost approach to account for loyalty programs. Upon adoption, the Company will use the deferred revenue approach. Additionally, gift card breakage currently is recognized at point of sale by the Retail Pharmacy USA segment and upon expiration primarily within the Retail Pharmacy International segment. Upon adoption of the new revenue recognition guidance, all breakage will be recognized based on the pattern in which the customer redeems the gift cards.

Supplemental information

9 Months Ended

May 31, 2018

Balance Sheet Related Disclosures [Abstract]

Supplemental information

Accounts receivable

Accounts receivable are stated net of allowances for doubtful accounts. Accounts receivable balances primarily consist of trade receivables due from customers, including amounts due from third party providers (e.g., pharmacy benefit managers, insurance companies and governmental agencies), clients and members. Trade receivables were $5,893 million and $5,458 million at May 31, 2018 and August 31, 2017, respectively. Other accounts receivable balances, which consist primarily of receivables from vendors and manufacturers, including receivables from AmerisourceBergen (see note 16, related parties), were $1,266 million and $1,070 million at May 31, 2018 and August 31, 2017, respectively.

Depreciation and amortization

The Company has recorded the following depreciation and amortization expense in the Consolidated Condensed Statements of Earnings (in millions):



	Three months ended May 31,				Nine months ended May 31,
	2018		2017		2018		2017
Depreciation expense	$	358	$	334	$	1,040	$	1,000
Intangible asset and other amortization	84		79		260		244
Total depreciation and amortization expense	$	442	$	413	$	1,300	$	1,244

Accumulated depreciation and amortization on property, plant and equipment was $10.2 billion at May 31, 2018 and $9.3 billion at August 31, 2017.

Subsequent event	9 Months Ended
Subsequent event	May 31, 2018
Subsequent Events [Abstract]
Subsequent event	Subsequent event On June 28, 2018, Premise Health Holding Corp. and OMERS, a Canadian pension fund, announced that an affiliate of OMERS will acquire control of Premise Health, which is currently owned by an entity in which the Company indirectly holds a minority equity interest. The transaction, which is subject to customary closing conditions, is expected to be completed in July 2018. Upon closing, the Company estimates that it would recognize an after-tax gain on disposition of approximately $272 million, which the Company intends to treat as a special item impacting the comparability of results.

Accounting policies (Policies)	9 Months Ended
Accounting policies (Policies)	May 31, 2018
Accounting Policies [Abstract]
Basis of Presentation	Basis of presentation The Consolidated Condensed Financial Statements of Walgreens Boots Alliance, Inc. (“Walgreens Boots Alliance” or the “Company”) included herein have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission regarding interim financial reporting. The Consolidated Condensed Financial Statements include all subsidiaries in which the Company holds a controlling interest. Investments in less than majority-owned subsidiaries in which the Company does not have a controlling interest, but does have significant influence, are accounted for as equity method investments. All intercompany transactions have been eliminated. The Consolidated Condensed Financial Statements included herein are unaudited. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States (“GAAP”) have been condensed or omitted pursuant to such rules and regulations, although the Company believes that the disclosures are adequate to make the information presented not misleading. These unaudited Consolidated Condensed Financial Statements should be read in conjunction with the audited financial statements and the notes thereto included in the Walgreens Boots Alliance Annual Report on Form 10-K for the fiscal year ended August 31, 2017. In the opinion of management, the unaudited Consolidated Condensed Financial Statements for the interim periods presented include all adjustments (consisting only of normal recurring adjustments) necessary to present a fair statement of the results for such interim periods. The influence of certain holidays, seasonality, foreign currency rates, changes in vendor, payer and customer relationships and terms, strategic transactions including acquisitions, changes in laws, and general economic conditions in the markets in which the Company operates, and other factors on the Company’s operations and net earnings for any period may not be comparable to the same period in previous years. With respect to the Company’s Retail Pharmacy USA segment, the positive impact on gross profit margins and gross profit dollars typically has been significant in the first several months after a generic version of a drug is first allowed to compete with the branded version, which is generally referred to as a “generic conversion”. In any given year, the number of major brand name drugs that undergo a conversion from branded to generic status can increase or decrease, which can have a significant impact on the Company’s Retail Pharmacy USA segment’s sales, gross profit margins and gross profit dollars making the Company’s operations or net earnings for any period incomparable.

Acquisitions (Tables)

9 Months Ended

May 31, 2018

Business Combinations [Abstract]

Schedule of Consideration for the Acquisition

The following table summarizes the consideration for the acquisition and the amounts of identified assets acquired and liabilities assumed at the date of the transaction (in millions).



Consideration	$	720

Identifiable assets acquired and liabilities assumed
Accounts receivable	$	217
Inventories	149
Property, plant and equipment	11
Intangible assets	331
Trade accounts payable	(90		)
Accrued expenses and other liabilities	(1		)
Total identifiable net assets	617
Goodwill	$	103

The following table summarizes the consideration for the purchases and the preliminary amounts of identified assets acquired and liabilities assumed as of the nine months ended May 31, 2018.



Consideration	$	4,330

Identifiable assets acquired and liabilities assumed
Inventories	$	1,291
Property, plant and equipment	494
Intangible assets	2,028
Accrued expenses and other liabilities	(54		)
Deferred income taxes	5
Other non-current liabilities	(795		)
Total identifiable net assets	2,969
Goodwill	$	1,361

Schedule of Definite Lived Intangible Assets

The preliminary identified definite-lived intangible assets were as follows:



Definite-lived intangible assets	Weighted-average useful life (in years)	Amount (in millions)
Customer relationships	12	$	1,850
Favorable lease interests	6	158
Trade names and trademarks	2	20
Total		$	2,028

Schedule of Pro Forma Information

The unaudited condensed pro forma information has been prepared for comparative purposes only and is not intended to be indicative of what the Company’s results would have been had the purchases occurred at the beginning of the periods presented or results which may occur in the future.



	Three months ended May 31,				Nine months ended May 31,
(in millions)	2018		2017		2018		2017
Sales	$	34,366	$	32,496	$	102,059	$	95,378

Actual sales from acquired Rite Aid stores for the three and nine months ended May 31, 2018 included in the Consolidated Statement of Earnings are as follows:



(in millions)	Three months ended May 31, 2018		Nine months ended May 31, 2018
Sales	$	2,223	$	3,038

Exit and disposal activities (Tables)

9 Months Ended

May 31, 2018

Restructuring and Related Activities [Abstract]

Restructuring and Related Costs

Total costs by segment, which were primarily recorded in selling, general and administrative expenses included in the three and nine months ended May 31, 2017, are as follows (in millions):



Three months ended May 31, 2017	Retail Pharmacy USA		Retail Pharmacy International		Pharmaceutical Wholesale		Walgreens Boots Alliance, Inc.
Asset impairments	$	96	$	18	$	—	$	114
Real estate costs	15		—		—		15
Severance and other business transition and exit costs	18		8		16		42
Total costs	$	129	$	26	$	16	$	171



Nine months ended May 31, 2017	Retail Pharmacy USA		Retail Pharmacy International		Pharmaceutical Wholesale		Walgreens Boots Alliance, Inc.
Asset impairments	$	207	$	21	$	1	$	229
Real estate costs	264		—		—		264
Severance and other business transition and exit costs	46		30		23		99
Total costs	$	517	$	51	$	24	$	592



Three months ended May 31, 2018
Lease obligations and other real estate costs	2
Employee severance and other exit costs	22
Total costs	$	24



Nine months ended May 31, 2018
Lease obligations and other real estate costs	2
Employee severance and other exit costs	22
Total costs	$	24

Accrued Expenses Related to Cost Transformation

The changes in liabilities related to the Store Optimization Program for the nine months ended May 31, 2018 include the following (in millions):



	Lease obligations and other real estate costs		Employee severance and other exit costs			Total
Balance at August 31, 2017	$	—	$	—		$	—
Costs	2		22			24
Payments	—		(8		)	(8		)
Other - non cash¹	30		—			30
Balance at May 31, 2018	$	32	$	14		$	46


¹	Represents unfavorable lease liabilities from acquired Rite Aid stores.

The changes in liabilities related to the Cost Transformation Program for the nine months ended May 31, 2018 include the following (in millions):



	Real estate costs			Severance and other business transition and exit costs			Total
Balance at August 31, 2017	$	521		$	79		$	600
Payments	(112		)	(68		)	(180		)
Other - non cash	20			(1		)	19
Currency translation adjustments	—			(1		)	(1		)
Balance at May 31, 2018	$	429		$	9		$	438

Operating leases (Tables)

9 Months Ended

May 31, 2018

Leases [Abstract]

Reserve for Facility Closings and Related Lease Termination Charges

The changes in reserve for facility closings and related lease termination charges primarily in other non-current liabilities, include the following (in millions):



	For the nine months ended May 31, 2018			For the twelve months ended August 31, 2017
Balance at beginning of period	$	718		$	466
Provision for present value of non-cancellable lease payments on closed facilities	34			344
Changes in assumptions	7			13
Accretion expense	47			37
Other - non cash¹	30			—
Cash payments, net of sublease income	(159		)	(142		)
Balance at end of period	$	677		$	718


¹	Represents unfavorable lease liabilities from acquired Rite Aid stores.

Equity method investments (Tables)

9 Months Ended

May 31, 2018

Equity Method Investments and Joint Ventures [Abstract]

Equity Method Investments

Equity method investments as of May 31, 2018 and August 31, 2017, are as follows (in millions, except percentages):



	May 31, 2018			August 31, 2017
	Carrying value		Ownership percentage	Carrying value		Ownership percentage
AmerisourceBergen	$	5,120	26%	$	5,024	26%
Others	1,152		8% - 50%	1,296		8% - 50%
Total	$	6,272		$	6,320

Goodwill and other intangible assets (Tables)

9 Months Ended

May 31, 2018

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Goodwill

Changes in the carrying amount of goodwill by reportable segment consist of the following (in millions):



	Retail Pharmacy USA		Retail Pharmacy International		Pharmaceutical Wholesale		Walgreens Boots Alliance, Inc.
Balance at August 31, 2017	$	9,139	$	3,392	$	3,101	$	15,632
Acquisitions	1,361		—		4		1,365
Currency translation adjustments	—		54		38		92
Balance at May 31, 2018	$	10,500	$	3,446	$	3,143	$	17,089

Schedule of Finite-Lived Intangible Assets by Major Class

The carrying amount and accumulated amortization of intangible assets consist of the following (in millions):



	May 31, 2018		August 31, 2017
Gross amortizable intangible assets
Customer relationships and loyalty card holders ¹	$	4,331	$	2,510
Favorable lease interests and non-compete agreements	621		523
Trade names and trademarks	495		504
Purchasing and payer contracts	389		391
Total gross amortizable intangible assets	5,836		3,928

Accumulated amortization
Customer relationships and loyalty card holders ¹	$	930	$	780
Favorable lease interests and non-compete agreements	353		355
Trade names and trademarks	190		155
Purchasing and payer contracts	71		51
Total accumulated amortization	1,544		1,341
Total amortizable intangible assets, net	$	4,292	$	2,587

Indefinite lived intangible assets
Trade names and trademarks	$	5,696	$	5,514
Pharmacy licenses	2,123		2,055
Total indefinite lived intangible assets	$	7,819	$	7,569

Total intangible assets, net	$	12,111	$	10,156


¹	Includes purchased prescription files.

Schedule of Finite-Lived Intangible Assets, Future Amortization Expense

Estimated future annual amortization expense for the next five fiscal years for intangible assets recorded at May 31, 2018 is as follows (in millions):



	2019		2020		2021		2022		2023
Estimated annual amortization expense	$	545	$	470	$	413	$	388	$	348

Debt (Tables)

9 Months Ended

May 31, 2018

Debt Disclosure [Abstract]

Short-Term Borrowings

Debt consist of the following (all amounts are presented in millions of U.S. dollars and debt issuances are denominated in U.S. dollars, unless otherwise noted)



	May 31, 2018		August 31, 2017
Short-term debt ¹
Commercial paper	1,039		—
Credit facilities ²	999		—
$1 billion note issuance ^3,4
5.250% unsecured notes due 2019 ⁵	248		—
Other ⁶	301		251
Total short-term debt	2,587		251

Long-term debt ¹
$6 billion note issuance ^3,7
3.450% unsecured notes due 2026	1,888		1,887
4.650% unsecured notes due 2046	590		590
$8 billion note issuance ^3,7
2.700% unsecured notes due 2019	1,247		1,246
3.300% unsecured notes due 2021	1,245		1,244
3.800% unsecured notes due 2024	1,989		1,988
4.500% unsecured notes due 2034	495		495
4.800% unsecured notes due 2044	1,492		1,492
£700 million note issuance ^3,7
2.875% unsecured Pound sterling notes due 2020	530		513
3.600% unsecured Pound sterling notes due 2025	397		384
€750 million note issuance ^3,7
2.125% unsecured Euro notes due 2026	869		884
$4 billion note issuance ^3,4
3.100% unsecured notes due 2022	1,195		1,195
4.400% unsecured notes due 2042	492		492
$1 billion note issuance ^3,4
5.250% unsecured notes due 2019 ⁵	—		250
Other ⁸	27		24
Total long-term debt, less current portion	$	12,456	$	12,684


¹	Carry values are presented net of unamortized discount and debt issuance costs, where applicable, and foreign currency denominated borrowings have been translated using spot rates at May 31, 2018 and August 31, 2017, respectively.

⁴


⁵	Includes interest rate swap fair market value adjustments. See note 9, fair value measurements for additional fair value disclosures.


⁶	Other short-term debt represents a mix of fixed and variable rate borrowings with various maturities and working capital facilities denominated in various currencies.


⁷	Notes are unsubordinated debt obligations of Walgreens Boots Alliance and rank equally in right of payment with all other unsecured and unsubordinated indebtedness of Walgreens Boots Alliance from time to time outstanding.


⁸	Other long-term debt represents a mix of fixed and variable rate borrowings in various currencies with various maturities.

Long-Term Debt

Debt consist of the following (all amounts are presented in millions of U.S. dollars and debt issuances are denominated in U.S. dollars, unless otherwise noted)



	May 31, 2018		August 31, 2017
Short-term debt ¹
Commercial paper	1,039		—
Credit facilities ²	999		—
$1 billion note issuance ^3,4
5.250% unsecured notes due 2019 ⁵	248		—
Other ⁶	301		251
Total short-term debt	2,587		251

Long-term debt ¹
$6 billion note issuance ^3,7
3.450% unsecured notes due 2026	1,888		1,887
4.650% unsecured notes due 2046	590		590
$8 billion note issuance ^3,7
2.700% unsecured notes due 2019	1,247		1,246
3.300% unsecured notes due 2021	1,245		1,244
3.800% unsecured notes due 2024	1,989		1,988
4.500% unsecured notes due 2034	495		495
4.800% unsecured notes due 2044	1,492		1,492
£700 million note issuance ^3,7
2.875% unsecured Pound sterling notes due 2020	530		513
3.600% unsecured Pound sterling notes due 2025	397		384
€750 million note issuance ^3,7
2.125% unsecured Euro notes due 2026	869		884
$4 billion note issuance ^3,4
3.100% unsecured notes due 2022	1,195		1,195
4.400% unsecured notes due 2042	492		492
$1 billion note issuance ^3,4
5.250% unsecured notes due 2019 ⁵	—		250
Other ⁸	27		24
Total long-term debt, less current portion	$	12,456	$	12,684


¹	Carry values are presented net of unamortized discount and debt issuance costs, where applicable, and foreign currency denominated borrowings have been translated using spot rates at May 31, 2018 and August 31, 2017, respectively.

⁴


⁵	Includes interest rate swap fair market value adjustments. See note 9, fair value measurements for additional fair value disclosures.


⁶	Other short-term debt represents a mix of fixed and variable rate borrowings with various maturities and working capital facilities denominated in various currencies.


⁷	Notes are unsubordinated debt obligations of Walgreens Boots Alliance and rank equally in right of payment with all other unsecured and unsubordinated indebtedness of Walgreens Boots Alliance from time to time outstanding.


⁸	Other long-term debt represents a mix of fixed and variable rate borrowings in various currencies with various maturities.

- Definition

Tabular disclosure of long-debt instruments or arrangements, including identification, terms, features, collateral requirements and other information necessary to a fair presentation. These are debt arrangements that originally required repayment more than twelve months after issuance or greater than the normal operating cycle of the entity, if longer.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 210
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.5-02.22)
-URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682

Reference 2: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 3
-URI http://asc.fasb.org/extlink&oid=84159872&loc=d3e21475-112644

Reference 3: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 942
-SubTopic 470
-Section 50
-Paragraph 3
-URI http://asc.fasb.org/extlink&oid=75038535&loc=d3e64711-112823

Reference 4: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08.(e),(f))
-URI http://asc.fasb.org/extlink&oid=26873400&loc=d3e23780-122690

Reference 5: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 835
-SubTopic 30
-Section 55
-Paragraph 8
-URI http://asc.fasb.org/extlink&oid=64930739&loc=d3e28878-108400

Reference 6: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 8
-URI http://asc.fasb.org/extlink&oid=84159872&loc=d3e21538-112644

Reference 7: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 6
-URI http://asc.fasb.org/extlink&oid=84159872&loc=d3e21506-112644

Reference 8: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 835
-SubTopic 30
-Section 45
-Paragraph 1A
-URI http://asc.fasb.org/extlink&oid=64930785&loc=d3e28541-108399

Reference 9: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 835
-SubTopic 30
-Section 45
-Paragraph 2
-URI http://asc.fasb.org/extlink&oid=64930785&loc=d3e28551-108399

Reference 10: http://www.xbrl.org/2003/role/presentationRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 7
-URI http://asc.fasb.org/extlink&oid=84159872&loc=d3e21521-112644

+ Details

Financial instruments (Tables)

9 Months Ended

May 31, 2018

Derivative [Line Items]

Notional Amounts, Fair Value and Balance Sheet Presentation of Derivative Instruments Outstanding

The notional amounts, fair value and balance sheet presentation of derivative instruments outstanding as of May 31, 2018 and August 31, 2017 are as follows (in millions):



	May 31, 2018				August 31, 2017
	Notional ¹		Fair value		Notional ¹		Fair value		Location in Consolidated Condensed Balance Sheets
Derivatives designated as hedges:
Interest rate swaps	$	—	$	—	$	250	$	—	Other non-current assets
Interest rate swaps	250		2		—		—		Other current liabilities
Foreign currency forwards	28		—		24		—		Other current assets
Derivatives not designated as hedges:
Foreign currency forwards	$	3,762	$	147	$	221	$	—	Other current assets
Foreign currency forwards	—		—		2,816		19		Other current liabilities


¹	Amounts are presented in U.S. dollar equivalents, as applicable.

Not designated as hedges

Derivative [Line Items]

Gains and (Losses) due to Changes in Fair Value Recognized in Earnings

The income and (expense) due to changes in fair value of these derivative instruments were recognized in earnings as follows (in millions):



		Three months ended May 31,					Nine months ended May 31,
	Location in Consolidated Condensed Statements of Earnings	2018		2017			2018			2017
Foreign currency forwards	Selling, general and administrative expenses	$	108	$	(19	)	$	(75	)	$	28
Foreign currency forwards	Other income (expense)	3		(1		)	36			(15		)

Fair value measurements (Tables)

9 Months Ended

May 31, 2018

Fair Value Disclosures [Abstract]

Assets and Liabilities Measured at Fair Value on a Recurring Basis

Assets and liabilities measured at fair value on a recurring basis are as follows (in millions):



	May 31, 2018		Level 1		Level 2		Level 3
Assets:
Money market funds¹	$	1,104	$	1,104	$	—	$	—
Available-for-sale investments²	1		1		—		—
Foreign currency forwards³	147		—		147		—
Liabilities:
Interest rate swaps⁴	2		—		2		—



	August 31, 2017		Level 1		Level 2		Level 3
Assets:
Money market funds¹	$	2,096	$	2,096	$	—	$	—
Available-for-sale investments²	1		1		—		—
Liabilities:
Foreign currency forwards³	19		—		19		—


¹	Money market funds are valued at the closing price reported by the fund sponsor.


²	The fair value of quoted investments are based on current bid prices as of the balance sheet dates.


³	The fair value of forward currency contracts are estimated by discounting the difference between the contractual forward price and the current available forward price for the residual maturity of the contract using observable market rates.


⁴	The fair value of interest rate swaps is calculated by discounting the estimated future cash flows based on the applicable observable yield curves. See note 8, financial instruments for additional information.

Retirement benefits (Tables)

9 Months Ended

May 31, 2018

Retirement Benefits [Abstract]

Components of Net Periodic Benefit Cost

Components of net periodic pension costs for the defined benefit pension plans (in millions):



	Three months ended May 31,						Nine months ended May 31,
	2018			2017			2018			2017
Service costs	$	2		$	1		$	5		$	3
Interest costs	50			43			146			129
Expected returns on plan assets/other	(54		)	(41		)	(158		)	(112		)
Total net periodic pension costs	$	(2	)	$	3		$	(7	)	$	20

Accumulated other comprehensive income (loss) (Tables)

9 Months Ended

May 31, 2018

Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]

Components of Accumulated Other Comprehensive Income (Loss)

The following is a summary of net changes in accumulated other comprehensive income by component and net of tax for the three and nine months ended May 31, 2018 and May 31, 2017 (in millions):



	Pension/ post- retirement obligations			Unrecognized gain (loss) on available-for- sale investments		Unrealized gain (loss) on cash flow hedges			Share of OCI of equity method investments			Currency translation adjustment			Total
Balance at February 28, 2018	$	(141	)	$	—	$	(32	)	$	—		$	(1,990	)	$	(2,163	)
Other comprehensive income (loss) before reclassification adjustments	—			—		—			3			(647		)	(644		)
Amounts reclassified from accumulated OCI	(2		)	—		1			11			8			18
Tax benefit (provision)	—			—		—			(3		)	—			(3		)
Net other comprehensive income (loss)	(2		)	—		1			11			(639		)	(629		)
Balance at May 31, 2018	$	(143	)	$	—	$	(31	)	$	11		$	(2,629	)	$	(2,792	)



	Pension/ post- retirement obligations			Unrecognized gain (loss) on available-for- sale investments		Unrealized gain (loss) on cash flow hedges			Share of OCI of equity method investments			Currency translation adjustment			Total
Balance at August 31, 2017	$	(139	)	$	—	$	(33	)	$	(2	)	$	(2,877	)	$	(3,051	)
Other comprehensive income (loss) before reclassification adjustments	(1		)	—		—			7			240			246
Amounts reclassified from accumulated OCI	(5		)	—		3			11			8			17
Tax benefit (provision)	2			—		(1		)	(5		)	—			(4		)
Net other comprehensive income (loss)	(4		)	—		2			13			248			259
Balance at May 31, 2018	$	(143	)	$	—	$	(31	)	$	11		$	(2,629	)	$	(2,792	)



	Pension/ post- retirement obligations			Unrecognized gain (loss) on available-for- sale investments			Unrealized gain (loss) on cash flow hedges			Share of OCI of equity method investments			Currency translation adjustment			Total
Balance at February 28, 2017	$	(216	)	$	1		$	(35	)	$	(6	)	$	(3,553	)	$	(3,809	)
Other comprehensive income (loss) before reclassification adjustments	(102		)	(1		)	—			4			499			400
Amounts reclassified from accumulated OCI¹	109			—			1			—			—			110
Tax benefit (provision)	(2		)	—			—			(2		)	—			(4		)
Net other comprehensive income (loss)	5			(1		)	1			2			499			506
Balance at May 31, 2017	$	(211	)	$	—		$	(34	)	$	(4	)	$	(3,054	)	$	(3,303	)



	Pension/ post- retirement obligations			Unrecognized gain (loss) on available-for- sale investments			Unrealized gain (loss) on cash flow hedges			Share of OCI of equity method investments			Currency translation adjustment			Total
Balance at August 31, 2016	$	(212	)	$	2		$	(37	)	$	(1	)	$	(2,744	)	$	(2,992	)
Other comprehensive income (loss) before reclassification adjustments	(107		)	(2		)	—			(4		)	(310		)	(423		)
Amounts reclassified from accumulated OCI¹	109			—			4			—			—			113
Tax benefit (provision)	(1		)	—			(1		)	1			—			(1		)
Net other comprehensive income (loss)	1			(2		)	3			(3		)	(310		)	(311		)
Balance at May 31, 2017	$	(211	)	$	—		$	(34	)	$	(4	)	$	(3,054	)	$	(3,303	)


¹	Includes amendment to U.S. postretirement healthcare plan resulting in a curtailment gain. See note 12, retirement benefits.

Segment reporting (Tables)

9 Months Ended

May 31, 2018

Segment Reporting [Abstract]

Reconciliation of Revenue from Segments to Consolidated

The following table reflects results of operations of the Company’s reportable segments (in millions):



	Retail Pharmacy USA		Retail Pharmacy International		Pharmaceutical Wholesale		Eliminations			Walgreens Boots Alliance, Inc.
Three months ended May 31, 2018
Sales to external customers	$	25,917	$	2,995	$	5,422	$	—		$	34,334
Intersegment sales	—		—		543		(543		)	—
Sales	$	25,917	$	2,995	$	5,965	$	(543	)	$	34,334

Adjusted operating income	$	1,492	$	198	$	257	$	—		$	1,947

Three months ended May 31, 2017
Sales to external customers	$	22,528	$	2,809	$	4,781	$	—		$	30,118
Intersegment sales	—		—		515		(515		)	—
Sales	$	22,528	$	2,809	$	5,296	$	(515	)	$	30,118

Adjusted operating income	$	1,463	$	193	$	253	$	5		$	1,914



	Retail Pharmacy USA		Retail Pharmacy International		Pharmaceutical Wholesale		Eliminations			Walgreens Boots Alliance, Inc.
Nine months ended May 31, 2018
Sales to external customers	$	72,884	$	9,395	$	15,816	$	—		$	98,095
Intersegment sales	—		—		1,622		(1,622		)	—
Sales	$	72,884	$	9,395	$	17,438	$	(1,622	)	$	98,095

Adjusted operating income	$	4,518	$	688	$	712	$	1		$	5,919

Nine months ended May 31, 2017
Sales to external customers	$	65,001	$	8,872	$	14,192	$	—		$	88,065
Intersegment sales	—		—		1,551		(1,551		)	—
Sales	$	65,001	$	8,872	$	15,743	$	(1,551	)	$	88,065

Adjusted operating income	$	4,304	$	648	$	703	$	1		$	5,656

Reconciliation of Operating Income (Loss) from Segments to Consolidated

The following table reconciles adjusted operating income to operating income (in millions):



	Retail Pharmacy USA		Retail Pharmacy International		Pharmaceutical Wholesale		Eliminations		Walgreens Boots Alliance, Inc.
Three months ended May 31, 2018
Adjusted operating income	$	1,492	$	198	$	257	$	—	$	1,947
Acquisition-related amortization									(131		)
Acquisition-related costs									(57		)
LIFO provision									(69		)
Adjustments to equity earnings in AmerisourceBergen									(60		)
Certain legal and regulatory accruals and settlements									(5		)
Store optimization									(24		)
Operating income									$	1,601

Three months ended May 31, 2017
Adjusted operating income	$	1,463	$	193	$	253	$	5	$	1,914
Acquisition-related amortization									(83		)
Acquisition-related costs									(29		)
LIFO provision									(97		)
Adjustments to equity earnings in AmerisourceBergen									(17		)
Cost transformation									(171		)
Operating income									$	1,517



	Retail Pharmacy USA		Retail Pharmacy International		Pharmaceutical Wholesale		Eliminations		Walgreens Boots Alliance, Inc.
Nine months ended May 31, 2018
Adjusted operating income	$	4,518	$	688	$	712	$	1	$	5,919
Acquisition-related amortization									(329		)
Acquisition-related costs									(173		)
LIFO provision									(166		)
Adjustments to equity earnings in AmerisourceBergen									(136		)
Certain legal and regulatory accruals and settlements									(120		)
Hurricane-related costs									(83		)
Store optimization									(24		)
Asset recovery									15
Operating income									$	4,903

Nine months ended May 31, 2017
Adjusted operating income	$	4,304	$	648	$	703	$	1	$	5,656
Acquisition-related amortization									(247		)
Acquisition-related costs									(75		)
LIFO provision									(204		)
Adjustments to equity earnings in AmerisourceBergen									(95		)
Cost transformation									(592		)
Operating income									$	4,443

Related parties (Tables)

9 Months Ended

May 31, 2018

Schedule of Related Party Transactions

Related party transactions (in millions):



	Three months ended May 31,				Nine months ended May 31,
	2018		2017		2018		2017
Purchases, net	$	15,830	$	10,703	$	39,566	$	31,941



	May 31, 2018		August 31, 2017
Trade accounts payable, net	$	5,802	$	4,384

Supplemental information (Tables)

9 Months Ended

May 31, 2018

Balance Sheet Related Disclosures [Abstract]

Schedule of Depreciation and Amortization Expense

The Company has recorded the following depreciation and amortization expense in the Consolidated Condensed Statements of Earnings (in millions):



	Three months ended May 31,				Nine months ended May 31,
	2018		2017		2018		2017
Depreciation expense	$	358	$	334	$	1,040	$	1,000
Intangible asset and other amortization	84		79		260		244
Total depreciation and amortization expense	$	442	$	413	$	1,300	$	1,244

Acquisitions - Schedule of consideration (Details) - USD ($) $ in Millions		3 Months Ended	9 Months Ended
	Mar. 31, 2017	May 31, 2018	May 31, 2018	Aug. 31, 2017
Business Acquisition [Line Items]
Goodwill		$ 17,089	$ 17,089	$ 15,632
AllianceRx Walgreens Prime
Business Acquisition [Line Items]
Consideration	$ 720
Accounts receivable	217
Inventories	149
Property, plant and equipment	11
Intangible assets	331
Trade accounts payable	(90)
Accrued expenses and other liabilities	(1)
Total identifiable net assets	617
Goodwill	$ 103
Rite Aid Corporation
Business Acquisition [Line Items]
Consideration		820	4,330
Inventories		1,291	1,291
Property, plant and equipment		494	494
Intangible assets		2,028	2,028
Accrued expenses and other liabilities		(54)	(54)
Deferred income taxes		5	5
Other non-current liabilities		(795)	(795)
Total identifiable net assets		2,969	2,969
Goodwill		$ 1,361	$ 1,361

Acquisitions - Narrative (Details) $ in Millions			3 Months Ended	9 Months Ended
Acquisitions - Narrative (Details) $ in Millions	Sep. 19, 2017 USD ($) distribution_center store	Mar. 31, 2017 USD ($)	May 31, 2018 USD ($) store	May 31, 2018 USD ($) store	Aug. 31, 2017 USD ($)
Business Acquisition [Line Items]
Goodwill			$ 17,089	$ 17,089	$ 15,632
Rite Aid Corporation
Business Acquisition [Line Items]
Number of stores expected to be acquired \| store	1,932
Number of distribution centers expected to be acquired \| distribution_center	3
Consideration to be transferred	$ 4,375
Number of locations acquired \| store			390	1,932
Cash consideration				$ 4,157
Total consideration			$ 820	4,330
Goodwill			$ 1,361	$ 1,361
AllianceRx Walgreens Prime
Business Acquisition [Line Items]
Total consideration		$ 720
Goodwill		$ 103
Payer contracts \| AllianceRx Walgreens Prime
Business Acquisition [Line Items]
Weighted-average useful life (in years)		15 years

Acquisitions - Intangible Assets (Details) - Rite Aid Corporation $ in Millions	9 Months Ended
	May 31, 2018 USD ($)
Business Acquisition [Line Items]
Finite-lived intangibles	$ 2,028
Customer relationships
Business Acquisition [Line Items]
Weighted-average useful life (in years)	12 years
Finite-lived intangibles	$ 1,850
Favorable lease interests
Business Acquisition [Line Items]
Weighted-average useful life (in years)	6 years
Finite-lived intangibles	$ 158
Trade names and trademarks
Business Acquisition [Line Items]
Weighted-average useful life (in years)	2 years
Finite-lived intangibles	$ 20

Acquisitions - Pro Forma (Details) - Rite Aid Corporation - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	May 31, 2018	May 31, 2017	May 31, 2018	May 31, 2017
Business Acquisition [Line Items]
Pro forma sales	$ 34,366	$ 32,496	$ 102,059	$ 95,378
actual revenues	$ 2,223		$ 3,038

Exit and disposal activities (Details) $ in Millions		9 Months Ended
Exit and disposal activities (Details) $ in Millions	Oct. 24, 2017 store	May 31, 2018 USD ($)
Store Optimization Program
Restructuring Reserve Disclosures [Abstract]
Number of stores expected to close \| store	600
Duration of restructuring plan	18 months
Expected cost		$ 450
Restructuring Reserve [Roll Forward]
Beginning Balance		0
Costs		24
Payments		(8)
Other - non cash		30
Ending Balance		46
Store Optimization Program \| Lease obligations and other real estate costs
Restructuring Reserve Disclosures [Abstract]
Expected cost		270
Restructuring Reserve [Roll Forward]
Beginning Balance		0
Costs		2
Payments		0
Other - non cash		30
Ending Balance		32
Store Optimization Program \| Severance and other business transition and exit costs
Restructuring Reserve Disclosures [Abstract]
Expected cost		180
Restructuring Reserve [Roll Forward]
Beginning Balance		0
Costs		22
Payments		(8)
Other - non cash		0
Ending Balance		14
Cost Transformation Program
Restructuring Reserve [Roll Forward]
Beginning Balance		600
Payments		(180)
Other - non cash		19
Currency translation adjustments		(1)
Ending Balance		438
Cost Transformation Program \| Real estate costs
Restructuring Reserve [Roll Forward]
Beginning Balance		521
Payments		(112)
Other - non cash		20
Currency translation adjustments		0
Ending Balance		429
Cost Transformation Program \| Severance and other business transition and exit costs
Restructuring Reserve [Roll Forward]
Beginning Balance		79
Payments		(68)
Other - non cash		(1)
Currency translation adjustments		(1)
Ending Balance		$ 9

Exit and disposal activities - Restructuring costs and reserves (Details) - USD ($) $ in Millions	3 Months Ended	9 Months Ended
	May 31, 2018	May 31, 2018
Restructuring Cost and Reserve [Line Items]
Restructuring costs	$ 171	$ 592
Asset impairments
Restructuring Cost and Reserve [Line Items]
Restructuring costs	114	229
Real estate costs
Restructuring Cost and Reserve [Line Items]
Restructuring costs	15	264
Severance and other business transition and exit costs
Restructuring Cost and Reserve [Line Items]
Restructuring costs	42	99
Retail Pharmacy USA
Restructuring Cost and Reserve [Line Items]
Restructuring costs	129	517
Retail Pharmacy USA \| Asset impairments
Restructuring Cost and Reserve [Line Items]
Restructuring costs	96	207
Retail Pharmacy USA \| Real estate costs
Restructuring Cost and Reserve [Line Items]
Restructuring costs	15	264
Retail Pharmacy USA \| Severance and other business transition and exit costs
Restructuring Cost and Reserve [Line Items]
Restructuring costs	18	46
Retail Pharmacy International
Restructuring Cost and Reserve [Line Items]
Restructuring costs	26	51
Retail Pharmacy International \| Asset impairments
Restructuring Cost and Reserve [Line Items]
Restructuring costs	18	21
Retail Pharmacy International \| Real estate costs
Restructuring Cost and Reserve [Line Items]
Restructuring costs	0	0
Retail Pharmacy International \| Severance and other business transition and exit costs
Restructuring Cost and Reserve [Line Items]
Restructuring costs	8	30
Pharmaceutical Wholesale
Restructuring Cost and Reserve [Line Items]
Restructuring costs	16	24
Pharmaceutical Wholesale \| Asset impairments
Restructuring Cost and Reserve [Line Items]
Restructuring costs	0	1
Pharmaceutical Wholesale \| Real estate costs
Restructuring Cost and Reserve [Line Items]
Restructuring costs	0	0
Pharmaceutical Wholesale \| Severance and other business transition and exit costs
Restructuring Cost and Reserve [Line Items]
Restructuring costs	16	23
Store Optimization Program
Restructuring Cost and Reserve [Line Items]
Restructuring costs	24	24
Store Optimization Program \| Lease obligations and other real estate costs
Restructuring Cost and Reserve [Line Items]
Restructuring costs	2	2
Store Optimization Program \| Severance and other business transition and exit costs
Restructuring Cost and Reserve [Line Items]
Restructuring costs	$ 22	$ 22

Operating leases (Details) $ in Millions	3 Months Ended		9 Months Ended		12 Months Ended
Operating leases (Details) $ in Millions	May 31, 2018 USD ($) lease	May 31, 2017 USD ($)	May 31, 2018 USD ($) lease	May 31, 2017 USD ($)	Aug. 31, 2017 USD ($)
Operating Leased Assets [Line Items]
Interval period of renewal options			5 years
Proceeds from sale-leaseback transactions			$ 0	$ 436
Charges related to facilities that were closed or relocated	$ 21	$ 25	$ 88	289
Number of leases \| lease	71		71
Potential undiscounted future payments	$ 311		$ 311
Changes in reserve for facility closings and related lease termination charges [Roll Forward]
Balance at beginning of period			718	$ 466	$ 466
Provision for present value of non-cancellable lease payments on closed facilities			34		344
Changes in assumptions			7		13
Accretion expense			47		37
Other - non cash			30		0
Cash payments, net of sublease income			(159)		(142)
Balance at end of period	$ 677		$ 677		$ 718
Minimum
Operating Leased Assets [Line Items]
Initial term of operating lease			15 years
Maximum
Operating Leased Assets [Line Items]
Initial term of operating lease			25 years

Equity method investments - Schedule of Equity Method Investments (Details) - USD ($) $ in Millions	May 31, 2018	Aug. 31, 2017
Schedule of Equity Method Investments [Line Items]
Carrying value	$ 6,272	$ 6,320
AmerisourceBergen
Schedule of Equity Method Investments [Line Items]
Carrying value	$ 5,120	$ 5,024
Ownership percentage	26.00%	26.00%
Others
Schedule of Equity Method Investments [Line Items]
Carrying value	$ 1,152	$ 1,296
Others \| Minimum
Schedule of Equity Method Investments [Line Items]
Ownership percentage	8.00%	8.00%
Others \| Maximum
Schedule of Equity Method Investments [Line Items]
Ownership percentage	50.00%	50.00%
Total
Schedule of Equity Method Investments [Line Items]
Carrying value	$ 6,272	$ 6,320

Equity method investments - Narrative (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	May 31, 2018	May 31, 2017	May 31, 2018	May 31, 2017	Aug. 31, 2017
Schedule of Equity Method Investments [Line Items]
Equity earnings (losses)	$ 15	$ (21)	$ 42	$ 7
AmerisourceBergen
Schedule of Equity Method Investments [Line Items]
Outstanding shares owned (in shares)	56,854,867		56,854,867		56,854,867
Ownership percentage	26.00%		26.00%		26.00%
Period of reporting lag			2 months
Equity investment, exceeded its proportionate share of net assets	$ 4,200		$ 4,200
AmerisourceBergen \| Level 1
Schedule of Equity Method Investments [Line Items]
Fair market value of equity investment	4,700		4,700
Other Investments
Schedule of Equity Method Investments [Line Items]
Equity earnings (losses)	$ 15	$ (21)	42	$ 7
Guangzhou Pharmaceuticals Corporation
Schedule of Equity Method Investments [Line Items]
Equity method investments, percent of investment sold	30.00%
Equity method investment, amount sold	$ 172
Cumulative translation adjustment loss	$ 8
Other income (expense) \| Guangzhou Pharmaceuticals Corporation
Schedule of Equity Method Investments [Line Items]
Equity method investments impairment			$ 170

Goodwill and other intangible assets - Schedule of Goodwill (Details) $ in Millions	9 Months Ended
	May 31, 2018 USD ($)
Goodwill [Roll Forward]
Net book value - Beginning Period	$ 15,632
Acquisitions	1,365
Currency translation adjustments	92
Net book value - Ending Period	17,089
Retail Pharmacy USA
Goodwill [Roll Forward]
Net book value - Beginning Period	9,139
Acquisitions	1,361
Currency translation adjustments	0
Net book value - Ending Period	10,500
Retail Pharmacy International
Goodwill [Roll Forward]
Net book value - Beginning Period	3,392
Acquisitions	0
Currency translation adjustments	54
Net book value - Ending Period	3,446
Pharmaceutical Wholesale
Goodwill [Roll Forward]
Net book value - Beginning Period	3,101
Acquisitions	4
Currency translation adjustments	38
Net book value - Ending Period	$ 3,143

Goodwill and other intangible assets - Schedule of Finite-Lived Intangible Assets by Major Class (Details) - USD ($) $ in Millions	May 31, 2018	Aug. 31, 2017
Finite-Lived Intangible Assets [Line Items]
Gross amortizable intangible assets	$ 5,836	$ 3,928
Accumulated amortization	1,544	1,341
Total amortizable intangible assets, net	4,292	2,587
Indefinite lived intangible assets	7,819	7,569
Total intangible assets, net	12,111	10,156
Trade names and trademarks
Finite-Lived Intangible Assets [Line Items]
Indefinite lived intangible assets	5,696	5,514
Pharmacy licenses
Finite-Lived Intangible Assets [Line Items]
Indefinite lived intangible assets	2,123	2,055
Customer relationships and loyalty card holders
Finite-Lived Intangible Assets [Line Items]
Gross amortizable intangible assets	4,331	2,510
Accumulated amortization	930	780
Favorable lease interests and non-compete agreements
Finite-Lived Intangible Assets [Line Items]
Gross amortizable intangible assets	621	523
Accumulated amortization	353	355
Trade names and trademarks
Finite-Lived Intangible Assets [Line Items]
Gross amortizable intangible assets	495	504
Accumulated amortization	190	155
Purchasing and payer contracts
Finite-Lived Intangible Assets [Line Items]
Gross amortizable intangible assets	389	391
Accumulated amortization	$ 71	$ 51

Goodwill and other intangible assets - Narrative (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	May 31, 2018	May 31, 2017	May 31, 2018	May 31, 2017
Goodwill and Intangible Assets Disclosure [Abstract]
Amortization expense for intangible assets	$ 146	$ 98	$ 363	$ 287

Goodwill and other intangible assets - Schedule of Finite-Lived Intangible Assets, Future Amortization Expense (Details) $ in Millions	May 31, 2018 USD ($)
Estimated annual intangible assets amortization expense [Abstract]
2019	$ 545
2020	470
2021	413
2022	388
2023	$ 348

Debt - Short and Long-Term Debt (Details) - USD ($) $ in Millions	9 Months Ended
	May 31, 2018	Aug. 31, 2017
Debt Instrument [Line Items]
Total short-term debt	$ 2,587	$ 251
Other	27	24
Total long-term debt, less current portion	12,456	12,684
Other Short Term Debt
Debt Instrument [Line Items]
Total short-term debt	301	251
Unsecured Notes \| 3.450% unsecured notes due 2026
Debt Instrument [Line Items]
Carrying value of notes, net of unamortized discount and interest rate swap FMV adjustment	$ 1,888	1,887
Stated interest rate	3.45%
Maturity year	2026
Unsecured Notes \| 4.650% unsecured notes due 2046
Debt Instrument [Line Items]
Carrying value of notes, net of unamortized discount and interest rate swap FMV adjustment	$ 590	590
Stated interest rate	4.65%
Maturity year	2046
Unsecured Notes \| 2.700% unsecured notes due 2019
Debt Instrument [Line Items]
Carrying value of notes, net of unamortized discount and interest rate swap FMV adjustment	$ 1,247	1,246
Stated interest rate	2.70%
Maturity year	2019
Unsecured Notes \| 3.300% unsecured notes due 2021
Debt Instrument [Line Items]
Carrying value of notes, net of unamortized discount and interest rate swap FMV adjustment	$ 1,245	1,244
Stated interest rate	3.30%
Maturity year	2021
Unsecured Notes \| 3.800% unsecured notes due 2024
Debt Instrument [Line Items]
Carrying value of notes, net of unamortized discount and interest rate swap FMV adjustment	$ 1,989	1,988
Stated interest rate	3.80%
Maturity year	2024
Unsecured Notes \| 4.500% unsecured notes due 2034
Debt Instrument [Line Items]
Carrying value of notes, net of unamortized discount and interest rate swap FMV adjustment	$ 495	495
Stated interest rate	4.50%
Maturity year	2034
Unsecured Notes \| 4.800% unsecured notes due 2044
Debt Instrument [Line Items]
Carrying value of notes, net of unamortized discount and interest rate swap FMV adjustment	$ 1,492	1,492
Stated interest rate	4.80%
Maturity year	2044
Unsecured Notes \| 2.875% unsecured Pound sterling notes due 2020
Debt Instrument [Line Items]
Carrying value of notes, net of unamortized discount and interest rate swap FMV adjustment	$ 530	513
Stated interest rate	2.875%
Maturity year	2020
Unsecured Notes \| 3.600% unsecured Pound sterling notes due 2025
Debt Instrument [Line Items]
Carrying value of notes, net of unamortized discount and interest rate swap FMV adjustment	$ 397	384
Stated interest rate	3.60%
Maturity year	2025
Unsecured Notes \| 2.125% unsecured Euro notes due 2026
Debt Instrument [Line Items]
Carrying value of notes, net of unamortized discount and interest rate swap FMV adjustment	$ 869	884
Stated interest rate	2.125%
Maturity year	2026
Unsecured Notes \| 3.100% unsecured notes due 2022
Debt Instrument [Line Items]
Carrying value of notes, net of unamortized discount and interest rate swap FMV adjustment	$ 1,195	1,195
Stated interest rate	3.10%
Maturity year	2022
Unsecured Notes \| 4.400% unsecured notes due 2042
Debt Instrument [Line Items]
Carrying value of notes, net of unamortized discount and interest rate swap FMV adjustment	$ 492	492
Stated interest rate	4.40%
Maturity year	2042
Unsecured Notes \| 5.250% unsecured notes due 2019
Debt Instrument [Line Items]
Carrying value of notes, net of unamortized discount and interest rate swap FMV adjustment	$ 0	250
Stated interest rate	5.25%
Maturity year	2019
Commercial paper
Debt Instrument [Line Items]
Total short-term debt	$ 1,039	0
Credit facilities
Debt Instrument [Line Items]
Total short-term debt	999	0
Notes Payable \| 5.250% unsecured notes due 2019
Debt Instrument [Line Items]
Total short-term debt	$ 248	$ 0
Stated interest rate	5.25%
Maturity year	2019

Debt - Note Issuances (Details) - May 31, 2018	USD ($)	EUR (€)
Total $6.0 billion debt issuance
Debt Instrument [Line Items]
Face amount	$ 6,000,000,000
Fair value of the notes	2,400,000,000
Carrying value of the notes	2,500,000,000
Total $8.0 billion debt issuance
Debt Instrument [Line Items]
Face amount	8,000,000,000
Fair value of the notes	6,400,000,000
Carrying value of the notes	6,500,000,000
Total 700 million pounds debt issuance
Debt Instrument [Line Items]
Face amount \| €		€ 700,000,000.0
Fair value of the notes	1,000,000,000
Carrying value of the notes	900,000,000
Total 750 million euros debt issuance
Debt Instrument [Line Items]
Face amount \| €		€ 750,000,000.00
Fair value of the notes	900,000,000
Carrying value of the notes	900,000,000
Total $4.0 billion debt issuance
Debt Instrument [Line Items]
Face amount	4,000,000,000
Fair value of the notes	1,700,000,000
Carrying value of the notes	1,700,000,000
Total $1.0 billion debt issuance
Debt Instrument [Line Items]
Face amount	1,000,000,000
Fair value of the notes	300,000,000
Carrying value of the notes	$ 200,000,000

Debt - Loan Agreements and Other Borrowings (Details)			9 Months Ended
Debt - Loan Agreements and Other Borrowings (Details)	Jun. 05, 2017 USD ($)	Jun. 01, 2016 USD ($) tranche	May 31, 2018 USD ($)	May 31, 2017 USD ($)	Mar. 14, 2018 USD ($)	Aug. 24, 2017 USD ($)
Line of Credit Facility [Line Items]
Proceeds from notes payable		$ 6,000,000,000
Number of tranches \| tranche		5
Redemption price, percentage of principal amount redeemed	101.00%
Redemption price, accrued and unpaid interest	$ 1,000,000
Interest paid			$ 450,000,000	$ 573,000,000
Revolving Credit Facility \| March 2018 Revolving Credit Facility
Line of Credit Facility [Line Items]
Maximum borrowing capacity					$ 350,000,000
Revolving Credit Facility \| August 2017 Revolving Credit Agreement
Line of Credit Facility [Line Items]
Borrowing outstanding			$ 0
Commercial paper
Line of Credit Facility [Line Items]
Average daily short-term borrowings				$ 1,400,000,000
Weighted-average interest rate				2.00%
Term Loan \| Maximum
Line of Credit Facility [Line Items]
Debt to total capitalization ratio			0.60
Medium-term Notes \| August 2017 Revolving Credit Agreement
Line of Credit Facility [Line Items]
Maximum borrowing capacity						$ 1,000,000,000.0
Medium-term Notes \| February 2017 Revolving Credit Agreement
Line of Credit Facility [Line Items]
Maximum borrowing capacity						1,000,000,000.0
Borrowing outstanding			$ 0
Medium-term Notes \| 2017 Term Loan Agreement
Line of Credit Facility [Line Items]
Maximum borrowing capacity						$ 1,000,000,000.0
Borrowing outstanding			$ 1,000,000,000

Financial instruments (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
Financial instruments (Details) - USD ($) $ in Millions	May 31, 2018	May 31, 2017	May 31, 2018	May 31, 2017	Aug. 31, 2017
Interest rate swaps \| Six-month LIBOR
Derivatives, Fair Value [Line Items]
Fair value	$ 250		$ 250
Fixed interest rate percentage	5.25%		5.25%
Foreign currency forwards \| Not designated as hedges \| Selling, general and administrative expenses
Effect of Fair Value Hedges on Results of Operations [Abstract]
Gains and (losses) due to changes in fair value of derivative instruments	$ 108	$ (19)	$ (75)	$ 28
Foreign currency forwards \| Not designated as hedges \| Other income (expense)
Effect of Fair Value Hedges on Results of Operations [Abstract]
Gains and (losses) due to changes in fair value of derivative instruments	3	$ (1)	36	$ (15)
Other non-current assets \| Interest rate swaps \| Designated as hedges
Derivatives, Fair Value [Line Items]
Notional	0		0		$ 250
Fair value	0		0		0
Other current liabilities \| Interest rate swaps \| Designated as hedges
Derivatives, Fair Value [Line Items]
Notional	250		250		0
Fair value	2		2		0
Other current liabilities \| Foreign currency forwards \| Not designated as hedges
Derivatives, Fair Value [Line Items]
Notional	0		0		2,816
Fair value	0		0		19
Other current assets \| Foreign currency forwards \| Designated as hedges
Derivatives, Fair Value [Line Items]
Notional	28		28		24
Fair value	0		0		0
Other current assets \| Foreign currency forwards \| Not designated as hedges
Derivatives, Fair Value [Line Items]
Notional	3,762		3,762		221
Fair value	$ 147		$ 147		$ 0

Fair value measurements (Details) - Recurring - USD ($) $ in Millions	May 31, 2018	Aug. 31, 2017
Money market funds
Assets [Abstract]
Fair value of assets	$ 1,104	$ 2,096
Available-for-sale investments
Assets [Abstract]
Fair value of assets	1	1
Interest rate swaps
Liabilities [Abstract]
Fair value of liabilities	2
Foreign currency forwards
Assets [Abstract]
Fair value of assets	147
Liabilities [Abstract]
Fair value of liabilities		19
Level 1 \| Money market funds
Assets [Abstract]
Fair value of assets	1,104	2,096
Level 1 \| Available-for-sale investments
Assets [Abstract]
Fair value of assets	1	1
Level 1 \| Interest rate swaps
Liabilities [Abstract]
Fair value of liabilities	0
Level 1 \| Foreign currency forwards
Assets [Abstract]
Fair value of assets	0
Liabilities [Abstract]
Fair value of liabilities		0
Level 2 \| Money market funds
Assets [Abstract]
Fair value of assets	0	0
Level 2 \| Available-for-sale investments
Assets [Abstract]
Fair value of assets	0	0
Level 2 \| Interest rate swaps
Liabilities [Abstract]
Fair value of liabilities	2
Level 2 \| Foreign currency forwards
Assets [Abstract]
Fair value of assets	147
Liabilities [Abstract]
Fair value of liabilities		19
Level 3 \| Money market funds
Assets [Abstract]
Fair value of assets	0	0
Level 3 \| Available-for-sale investments
Assets [Abstract]
Fair value of assets	0	0
Level 3 \| Interest rate swaps
Liabilities [Abstract]
Fair value of liabilities	0
Level 3 \| Foreign currency forwards
Assets [Abstract]
Fair value of assets	$ 0
Liabilities [Abstract]
Fair value of liabilities		$ 0

Commitments and contingencies (Details) - lawsuit	3 Months Ended	9 Months Ended
Commitments and contingencies (Details) - lawsuit	Nov. 30, 2017	May 31, 2018	Aug. 31, 2017
Loss Contingencies [Line Items]
Duration for plaintiffs to file amended complaint	10 days
Rite Aid Transactions
Loss Contingencies [Line Items]
Number of lawsuits filed			2
State of Pennsylvania in the Court of Common Pleas of Cumberland County
Loss Contingencies [Line Items]
Number of lawsuits filed			1
United States District Court for the Middle District of Pennsylvania
Loss Contingencies [Line Items]
Number of lawsuits filed			1
Court of Chancery of the State of Delaware
Loss Contingencies [Line Items]
Lawsuits filed and dismissed		8

Income taxes (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
Income taxes (Details) - USD ($) $ in Millions	May 31, 2018	May 31, 2017	May 31, 2018	May 31, 2017
Income Tax Disclosure [Abstract]
Effective tax rate	7.60%	12.40%	19.40%	16.20%
Tax Cuts and Jobs Act of 2017, provisional income tax expense (benefit)	$ (140)		$ 44
Cash paid for income taxes			428	$ 839
Transition tax, provisional discrete tax expense			679
Tax Cuts and Jobs Act of 2017, discrete tax benefit			$ 635

Retirement benefits (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
Retirement benefits (Details) - USD ($) $ in Millions	May 31, 2018	May 31, 2017	May 31, 2018	May 31, 2017
Components of net periodic benefit costs [Abstract]
Employer cash contributions to defined benefit pension plans			$ 57
Employee expected additional contribution in current fiscal year			7
Postretirement Health Plan
Components of net periodic benefit costs [Abstract]
Gain due to curtailment		$ 109
Boots and Other Pension Plans
Components of net periodic benefit costs [Abstract]
Service costs	$ 2	1	5	$ 3
Interest costs	50	43	146	129
Expected returns on plan assets/other	(54)	(41)	(158)	(112)
Total net periodic pension costs	(2)	3	(7)	20
Walgreen Profit Sharing Retirement Trust
Defined Contribution Plan Disclosure [Line Items]
Profit sharing provision expense	53	58	164	164
Alliance Boots Retirement Savings Plan
Defined Contribution Plan Disclosure [Line Items]
Cost recognized in the consolidated condensed statements of earnings	$ 33	$ 26	$ 94	$ 82

Earnings per share (Details) - shares shares in Millions	3 Months Ended		9 Months Ended
Earnings per share (Details) - shares shares in Millions	May 31, 2018	May 31, 2017	May 31, 2018	May 31, 2017
Earnings Per Share [Abstract]
Antidilutive securities excluded from EPS calculations (in shares)	12.1	6.4	10.1	5.7

Accumulated other comprehensive income (loss) (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	May 31, 2018	May 31, 2017	May 31, 2018	May 31, 2017
AOCI [Roll Forward]
Beginning Balance			$ 28,274	$ 30,281
Net other comprehensive income (loss)	$ (642)	$ 511	266	(349)
Ending Balance	28,470	31,484	28,470	31,484
Pension/ post- retirement obligations
AOCI [Roll Forward]
Beginning Balance	(141)	(216)	(139)	(212)
Other comprehensive income (loss) before reclassification adjustments	0	(102)	(1)	(107)
Amounts reclassified from accumulated OCI	(2)	109	(5)	109
Tax benefit (provision)	0	(2)	2	(1)
Net other comprehensive income (loss)	(2)	5	(4)	1
Ending Balance	(143)	(211)	(143)	(211)
Unrecognized gain (loss) on available-for- sale investments
AOCI [Roll Forward]
Beginning Balance	0	1	0	2
Other comprehensive income (loss) before reclassification adjustments	0	(1)	0	(2)
Amounts reclassified from accumulated OCI	0	0	0	0
Tax benefit (provision)	0	0	0	0
Net other comprehensive income (loss)	0	(1)	0	(2)
Ending Balance	0	0	0	0
Unrealized gain (loss) on cash flow hedges
AOCI [Roll Forward]
Beginning Balance	(32)	(35)	(33)	(37)
Other comprehensive income (loss) before reclassification adjustments	0	0	0	0
Amounts reclassified from accumulated OCI	1	1	3	4
Tax benefit (provision)	0	0	(1)	(1)
Net other comprehensive income (loss)	1	1	2	3
Ending Balance	(31)	(34)	(31)	(34)
Share of OCI of equity method investments
AOCI [Roll Forward]
Beginning Balance	0	(6)	(2)	(1)
Other comprehensive income (loss) before reclassification adjustments	3	4	7	(4)
Amounts reclassified from accumulated OCI	11	0	11	0
Tax benefit (provision)	(3)	(2)	(5)	1
Net other comprehensive income (loss)	11	2	13	(3)
Ending Balance	11	(4)	11	(4)
Currency translation adjustment
AOCI [Roll Forward]
Beginning Balance	(1,990)	(3,553)	(2,877)	(2,744)
Other comprehensive income (loss) before reclassification adjustments	(647)	499	240	(310)
Amounts reclassified from accumulated OCI	8	0	8	0
Tax benefit (provision)	0	0	0	0
Net other comprehensive income (loss)	(639)	499	248	(310)
Ending Balance	(2,629)	(3,054)	(2,629)	(3,054)
Accumulated other comprehensive (loss) income
AOCI [Roll Forward]
Beginning Balance	(2,163)	(3,809)	(3,051)	(2,992)
Other comprehensive income (loss) before reclassification adjustments	(644)	400	246	(423)
Amounts reclassified from accumulated OCI	18	110	17	113
Tax benefit (provision)	(3)	(4)	(4)	(1)
Net other comprehensive income (loss)	(629)	506	259	(311)
Ending Balance	$ (2,792)	$ (3,303)	$ (2,792)	$ (3,303)

Segment reporting (Details) $ in Millions	3 Months Ended		9 Months Ended
Segment reporting (Details) $ in Millions	May 31, 2018 USD ($)	May 31, 2017 USD ($)	May 31, 2018 USD ($) segment	May 31, 2017 USD ($)
Segment Reporting Information [Line Items]
Number of reportable segments \| segment			3
Segment Reporting Information, Operating Income (Loss) [Abstract]
Sales	$ 34,334	$ 30,118	$ 98,095	$ 88,065
Adjusted operating income	1,947	1,914	5,919	5,656
Acquisition-related amortization	(131)	(83)	(329)	(247)
Acquisition-related costs	(57)	(29)	(173)	(75)
LIFO provision	(69)	(97)	(166)	(204)
Adjustments to equity earnings in AmerisourceBergen	(60)	(17)	(136)	(95)
Certain legal and regulatory accruals and settlements	(5)		(120)
Hurricane-related costs			(83)
Store optimization	(24)		(24)
Asset recovery			15
Cost transformation		(171)		(592)
Operating income	1,601	1,517	4,903	4,443
Retail Pharmacy USA
Segment Reporting Information, Operating Income (Loss) [Abstract]
Sales	25,917	22,528	72,884	65,001
Adjusted operating income	1,492	1,463	4,518	4,304
Retail Pharmacy International
Segment Reporting Information, Operating Income (Loss) [Abstract]
Sales	2,995	2,809	9,395	8,872
Adjusted operating income	198	193	688	648
Pharmaceutical Wholesale
Segment Reporting Information, Operating Income (Loss) [Abstract]
Sales	5,422	4,781	15,816	14,192
Adjusted operating income	257	253	712	703
Reportable Segments
Segment Reporting Information, Operating Income (Loss) [Abstract]
Sales	34,334	30,118	98,095	88,065
Reportable Segments \| Retail Pharmacy USA
Segment Reporting Information, Operating Income (Loss) [Abstract]
Sales	25,917	22,528	72,884	65,001
Adjusted operating income	1,492	1,463	4,518	4,304
Reportable Segments \| Retail Pharmacy International
Segment Reporting Information, Operating Income (Loss) [Abstract]
Sales	2,995	2,809	9,395	8,872
Adjusted operating income	198	193	688	648
Reportable Segments \| Pharmaceutical Wholesale
Segment Reporting Information, Operating Income (Loss) [Abstract]
Sales	5,965	5,296	17,438	15,743
Adjusted operating income	257	253	712	703
Eliminations
Segment Reporting Information, Operating Income (Loss) [Abstract]
Sales	(543)	(515)	(1,622)	(1,551)
Adjusted operating income	0	5	1	1
Eliminations \| Retail Pharmacy USA
Segment Reporting Information, Operating Income (Loss) [Abstract]
Sales	0	0	0	0
Eliminations \| Retail Pharmacy International
Segment Reporting Information, Operating Income (Loss) [Abstract]
Sales	0	0	0	0
Eliminations \| Pharmaceutical Wholesale
Segment Reporting Information, Operating Income (Loss) [Abstract]
Sales	$ 543	$ 515	$ 1,622	$ 1,551

Related parties (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
Related parties (Details) - USD ($) $ in Millions	May 31, 2018	May 31, 2017	May 31, 2018	May 31, 2017	Aug. 31, 2017
Related Party Transactions [Abstract]
Purchases, net	$ 15,830	$ 10,703	$ 39,566	$ 31,941
Trade accounts payable, net	$ 5,802		$ 5,802		$ 4,384

Supplemental information - Narrative (Details) - USD ($) $ in Millions	May 31, 2018	Aug. 31, 2017
Accounts, Notes, Loans and Financing Receivable [Line Items]
Accounts receivable from related party	$ 1,266	$ 1,070
Trade Accounts Receivable
Accounts, Notes, Loans and Financing Receivable [Line Items]
Trade receivables	$ 5,893	$ 5,458

Supplemental information - Depreciation and Amortization Expense (Details) - USD ($) $ in Millions	3 Months Ended		9 Months Ended
	May 31, 2018	May 31, 2017	May 31, 2018	May 31, 2017	Aug. 31, 2017
Balance Sheet Related Disclosures [Abstract]
Depreciation expense	$ 358	$ 334	$ 1,040	$ 1,000
Intangible asset and other amortization	84	79	260	244
Total depreciation and amortization expense	442	$ 413	1,300	$ 1,244
Accumulated depreciation and amortization on property, plant, and equipment	$ 10,200		$ 10,200		$ 9,300

Subsequent event (Details) $ in Millions	Jun. 28, 2018 USD ($)
Premise Health \| Subsequent Event
Subsequent Event [Line Items]
Gain on disposition of minority equity interest	$ 272