Accenture plc - Quarter Report: 2024 May (Form 10-Q)

Deferred tax expense (benefit) ()Other, net()()Change in assets and liabilities, net of acquisitions —Receivables and contract assets, current and non-current()()Other current and non-current assets()()Accounts payable()()Deferred revenues, current and non-current Accrued payroll and related benefits()()Income taxes payable, current and non-current() Other current and non-current liabilities()()Net cash provided by (used in) operating activities CASH FLOWS FROM INVESTING ACTIVITIES:Purchases of property and equipment()()Purchases of businesses and investments, net of cash acquired()()Proceeds from the sale of businesses and investments Other investing, net Net cash provided by (used in) investing activities()()CASH FLOWS FROM FINANCING ACTIVITIES:Proceeds from issuance of shares Purchases of shares()()Proceeds from debt Repayments of debt() Cash dividends paid()()Other financing, net()()Net cash provided by (used in) financing activities()()Effect of exchange rate changes on cash and cash equivalents()()NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS()

CASH AND CASH EQUIVALENTS, beginning of period

CASH AND CASH EQUIVALENTS, end of period

$ $ SUPPLEMENTAL CASH FLOW INFORMATION:Income taxes paid, net$ $

The accompanying Notes are an integral part of these Consolidated Financial Statements.


Table of Contents	Notes To Consolidated Financial Statements (In thousands of U.S. dollars, except share and per share amounts or as otherwise disclosed)
ACCENTURE FORM 10-Q		11

and $, respectively. The change in the allowance is primarily due to immaterial write-offs and changes in gross client receivables and contract assets.

$ Investments without readily determinable fair values Total non-current investments$ $

For investments in which we can exercise significant influence but do not control, we use the equity method of accounting. Equity method investments are initially recorded at cost and our proportionate share of gains and losses of the investee are included as a component of Other income (expense), net.


Table of Contents	Notes To Consolidated Financial Statements (In thousands of U.S. dollars, except share and per share amounts or as otherwise disclosed)
ACCENTURE FORM 10-Q		12

and $, respectively. $ $ $ Amortization - Deferred transition Amortization - Intangible assets Operating lease cost Other Total depreciation, amortization and other$ $ $ $

Business Optimization

During the second quarter of fiscal 2023, we initiated actions to streamline our operations, transform our non-billable corporate functions and consolidate our office space to reduce costs. We recorded $ billion in fiscal 2023 related to these actions and expect to record approximately $ million in fiscal 2024 for a total of $ billion, primarily related to employee severance. The actual amount and timing of severance and other personnel costs are dependent in part upon local country consultation processes and regulations and may differ from our current expectations and estimates.

)$ $ $ EMEA (1) Growth Markets (1) Total business optimization costs$ $ $ $

(1)Effective September 1, 2023, we revised the reporting of our geographic markets for the movement of our Middle East and Africa market units from Growth Markets to Europe, and the Europe market is now referred to as our EMEA (Europe, Middle East and Africa) geographic market. Prior period amounts have been reclassified to conform with the current period presentation.


Table of Contents	Notes To Consolidated Financial Statements (In thousands of U.S. dollars, except share and per share amounts or as otherwise disclosed)
ACCENTURE FORM 10-Q		13

billion and $ billion as of May 31, 2024 and August 31, 2023, respectively. Our remaining performance obligations represent the amount of transaction price for which work has not been performed and revenue has not been recognized. The majority of our contracts are terminable by the client on short notice with little or no termination penalties, and some without notice. Under Topic 606, only the non-cancelable portion of these contracts is included in our performance obligations. Additionally, our performance obligations only include variable consideration if we assess it is probable that a significant reversal of cumulative revenue recognized will not occur when the uncertainty is resolved. Based on the terms of our contracts, a significant portion of what we consider contract bookings is not included in our remaining performance obligations. We expect to recognize approximately % of our remaining performance obligations as of May 31, 2024 as revenue in fiscal 2024, an additional % in fiscal 2025, and the balance thereafter.

Contract Estimates

Adjustments in contract estimates related to performance obligations satisfied or partially satisfied in prior periods were immaterial for the three and nine months ended May 31, 2024 and 2023.

Contract Balances

Deferred transition revenues were $ and $ as of May 31, 2024 and August 31, 2023, respectively, and are included in Non-current deferred revenues. Costs related to these activities are also deferred and are expensed as the services are provided. Deferred transition costs were $ and $ as of May 31, 2024 and August 31, 2023, respectively, and are included in Deferred contract costs. Generally, deferred transition costs are recoverable under the contract in the event of early termination and are monitored regularly for impairment. Impairment losses are recorded when projected remaining undiscounted operating cash flows of the related contract are not sufficient to recover the carrying amount of contract assets.

$ Contract assets (current) Receivables and contract assets, net of allowance (current) Contract assets (non-current) Deferred revenues (current) Deferred revenues (non-current)

Changes in the contract asset and liability balances during the nine months ended May 31, 2024 were a result of normal business activity and not materially impacted by any other factors.

Revenues recognized during the three and nine months ended May 31, 2024 that were included in Deferred revenues as of February 29, 2024 and August 31, 2023 were $ billion and $ billion, respectively. Revenues recognized during the three and nine months ended May 31, 2023 that were included in Deferred revenues as of February 28, 2023 and August 31, 2022 were $ billion and $ billion, respectively.


Table of Contents	Notes To Consolidated Financial Statements (In thousands of U.S. dollars, except share and per share amounts or as otherwise disclosed)
ACCENTURE FORM 10-Q		14

$ $ $ Basic weighted average Class A ordinary shares Basic earnings per share$ $ $ $ Diluted earnings per shareNet income attributable to Accenture plc$ $ $ $ Net income attributable to noncontrolling interests in Accenture Canada Holdings Inc. (1) Net income for diluted earnings per share calculation$ $ $ $ Basic weighted average Class A ordinary shares Class A ordinary shares issuable upon redemption/exchange of noncontrolling interests (1) Diluted effect of employee compensation related to Class A ordinary shares Diluted effect of share purchase plans related to Class A ordinary shares Diluted weighted average Class A ordinary shares (2) Diluted earnings per share$ $ $ $

(1)Diluted earnings per share assumes the exchange of all Accenture Canada Holdings Inc. exchangeable shares for Accenture plc Class A ordinary shares on a one-for-one basis. The income effect does not take into account “Net income attributable to noncontrolling interests - other,” since those shares are not redeemable or exchangeable for Accenture plc Class A ordinary shares.

(2)The weighted average diluted shares outstanding for the calculation of diluted earnings per share excludes an immaterial amount of shares issuable upon the vesting of restricted stock units because their effects were antidilutive.


Table of Contents	Notes To Consolidated Financial Statements (In thousands of U.S. dollars, except share and per share amounts or as otherwise disclosed)
ACCENTURE FORM 10-Q		15

)$()$()$() Foreign currency translation() () Income tax benefit (expense) () Portion attributable to noncontrolling interests () () Foreign currency translation, net of tax() () Ending balance()()()()Defined benefit plans Beginning balance()()()() Reclassifications into net periodic pension and
post-retirement expense Income tax benefit (expense)()()()() Portion attributable to noncontrolling interests()()()() Defined benefit plans, net of tax Ending balance()()()()Cash flow hedges Beginning balance ()() Unrealized gain (loss) () () Reclassification adjustments into Cost of services() () Income tax benefit (expense) ()() Portion attributable to noncontrolling interests ()() Cash flow hedges, net of tax() () Ending balance (1) () ()Health & Public Service3.5 3.3 %Managed Services8.0 7.9

(1) Each plan will expire on the earlier of the expiration date or the completion of all transactions under the trading arrangement.

Item 6. Exhibits

Exhibit Index:


Exhibit Number						Exhibit
3.1						Amended and Restated Memorandum and Articles of Association of Accenture plc (incorporated by reference to Exhibit 3.1 to Accenture plc’s 8-K filed on February 7, 2018)

10.1						Credit Agreement, dated as of May 14, 2024, among Accenture plc, the borrowers party thereto, the lenders party thereto, and JPMorgan Chase Bank, N.A., as administrative agent (incorporated by reference to Exhibit 10.1 to Accenture plc’s 8-K filed on May 17, 2024)

31.1						Certification of the Principal Executive Officer pursuant to Rule 13a-14(a) or 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (filed herewith)

31.2						Certification of the Principal Financial Officer pursuant to Rule 13a-14(a) or 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (filed herewith)

32.1						Certification of the Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (furnished herewith)

32.2						Certification of the Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (furnished herewith)

101						The following financial information from Accenture plc’s Quarterly Report on Form 10-Q for the quarterly period ended May 31, 2024, formatted in Inline XBRL: (i) Consolidated Balance Sheets as of May 31, 2024 (Unaudited) and August 31, 2023, (ii) Consolidated Income Statements (Unaudited) for the three and nine months ended May 31, 2024 and May 31, 2023, (iii) Consolidated Statements of Comprehensive Income (Unaudited) for the three and nine months ended May 31, 2024 and May 31, 2023, (iv) Consolidated Shareholders’ Equity Statement (Unaudited) for the three and nine months ended May 31, 2024 and May 31, 2023, (v) Consolidated Cash Flows Statements (Unaudited) for the nine months ended May 31, 2024 and May 31, 2023 and (vi) the Notes to Consolidated Financial Statements (Unaudited)

104						The cover page from Accenture plc’s Quarterly Report on Form 10-Q for the quarterly period ended May 31, 2024, formatted in Inline XBRL (included as Exhibit 101)


Table of Contents
ACCENTURE FORM 10-Q	Signatures	37

Signatures

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Date: June 20, 2024


			ACCENTURE PLC

			By:			/s/ KC McClure
			Name:			KC McClure
			Title:			Chief Financial Officer
						(Principal Financial Officer and Authorized Signatory)

Accenture plc - Quarter Report: 2024 May (Form 10-Q)

Similar companies