Nike (NKE)

Short-term Investments

Short-term investments consist of highly liquid investments, primarily commercial paper, U.S. Treasury, U.S. agency, and corporate debt
securities, with maturities over three months from the date of purchase. Debt securities which the Company has the ability and positive intent to hold to maturity are carried at amortized cost, which approximates fair value. Short-term investments
of $124.9 million and $975.4 million at May 31, 2008 and 2007, respectively, were classified as held-to-maturity and primarily comprised of U.S. Treasury and U.S. agency securities. All held-to-maturity securities at May 31, 2008 have
maturity dates within one year.

Available-for-sale debt securities are recorded at fair value with net unrealized gains and losses
reported, net of tax, in other comprehensive income, unless unrealized losses are determined to be other than temporary. The Company considers all available-for-sale securities, including those with maturity dates beyond 12 months, as available to
support current operational liquidity needs and therefore classifies these securities as current assets within Short-term investments on the consolidated balance sheet. As of May 31, 2008, the Company held $432.3 million of available-for-sale
securities with maturity dates within one year and $85.0 million with maturity dates over one year and less than five years.

Investments
classified as available-for-sale consist of the following at fair value:

Included in interest income, net for the years ended May 31, 2008, 2007, and 2006, was
interest income of $115.8 million, $116.9 million and $87.3 million, respectively, related to short-term investments and cash and equivalents.

SIZE="2">Allowance for Uncollectible Accounts Receivable

Accounts receivable consists principally of amounts receivable from
customers. We make ongoing estimates relating to the collectibility of our accounts receivable and maintain an allowance for estimated losses resulting from the inability of our customers to make required payments. In determining the amount of the
allowance, we consider our historical level of credit losses and make judgments about the creditworthiness of significant customers based on ongoing credit evaluations. Accounts receivable with anticipated collection dates greater than twelve months
from the balance sheet date and related allowances are considered non-current and recorded in other assets. The allowance for uncollectible accounts receivable was $78.4 million and $71.5 million at May 31, 2008 and 2007, respectively, of which
$36.7 million and $33.3 million was recorded in other assets.

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NIKE, INC.

FACE="Times New Roman" SIZE="2">NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)