Accenture plc Files Q3 2024 10-Q Financial Report

TL;DR

Accenture's Q3 2024 10-Q is in: financials look solid, keep an eye on revenue trends.

AI Summary

Accenture plc filed its 10-Q for the period ending May 31, 2024, reporting on its financial performance for the third quarter of fiscal year 2024. The filing details the company's financial position and operational results, including key figures related to revenue, net income, and earnings per share. Specific financial data for the current quarter and comparative periods are provided, reflecting Accenture's business activities and market conditions.

Why It Matters

This filing provides investors and analysts with crucial, up-to-date financial information about Accenture's performance, enabling informed investment decisions and market analysis.

Risk Assessment

Risk Level: low — This is a routine quarterly financial filing (10-Q) and does not inherently present new risks.

Key Players & Entities

• Accenture plc (company) — Filer of the 10-Q report
• 20240531 (date) — End of the reporting period
• 20240620 (date) — Date of filing

FAQ

Key Financial Figures

• $0.0000225 — red Class A ordinary shares, par value $0.0000225 per share ACN New York Stock Exchange

Filing Documents

• acn-20240531.htm (10-Q) — 1566KB
• acn531202410-qex311.htm (EX-31.1) — 10KB
• acn531202410-qex312.htm (EX-31.2) — 10KB
• acn531202410-qex321.htm (EX-32.1) — 5KB
• acn531202410-qex322.htm (EX-32.2) — 5KB
• acn-20240531_g1.gif (GRAPHIC) — 13KB
• 0001467373-24-000196.txt ( ) — 6708KB
• acn-20240531.xsd (EX-101.SCH) — 34KB
• acn-20240531_cal.xml (EX-101.CAL) — 93KB
• acn-20240531_def.xml (EX-101.DEF) — 165KB
• acn-20240531_lab.xml (EX-101.LAB) — 507KB
• acn-20240531_pre.xml (EX-101.PRE) — 352KB
• acn-20240531_htm.xml (XML) — 965KB

Financial Information

Part I. Financial Information 3

Financial Statements

Item 1. Financial Statements 3 Consolidated Balance Sheets as of May 31 , 2024 (Unaudited) and August 31, 2023 3 Consolidated Income Statements (Unaudited) for the three and nine months ended May 31 , 2024 and 2023 4 Consolidated Statements of Comprehensive Income (Unaudited) for the three and nine months ended May 31 , 2024 and 2023 5 Consolidated Shareholders' Equity Statement (Unaudited) for the three and nine months ended May 31 , 2024 and 2023 6 Consolidated Cash Flows Statements (Unaudited) for the nine months ended May 31 , 2024 and 2023 10

Notes to Consolidated Financial Statements (Unaudited)

Notes to Consolidated Financial Statements (Unaudited) 11

Management's Discussion and Analysis of Financial Condition and Results of Operations

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 22

Quantitative and Qualitative Disclosures About Market Risk

Item 3. Quantitative and Qualitative Disclosures About Market Risk 34

Controls and Procedures

Item 4. Controls and Procedures 34

Other Information

Part II. Other Information 35

Legal Proceedings

Item 1. Legal Proceedings 35

Risk Factors

Item 1A. Risk Factors 35

Unregistered Sales of Equity Securities and Use of Proceeds

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 35

Defaults Upon Senior Securities

Item 3. Defaults Upon Senior Securities 35

Mine Safety Disclosures

Item 4. Mine Safety Disclosures 36

Other Information

Item 5. Other Information 36

Exhibits

Item 6. Exhibits 36

Signatures

Signatures 37 Table of Contents Consolidated Financial Statements (In thousands of U.S. dollars, except share and per share amounts) ACCENTURE FORM 10-Q 3

— Financial Information

Part I — Financial Information

Financial Statements

Item 1. Financial Statements Consolidated Balance Sheets May 31, 2024 and August 31, 2023 May 31, 2024 August 31, 2023 ASSETS (Unaudited) CURRENT ASSETS: Cash and cash equivalents $ 5,537,217 $ 9,045,032 Short-term investments 4,878 4,575 Receivables and contract assets 13,199,388 12,227,186 Other current assets 2,333,935 2,105,138 Total current assets 21,075,418 23,381,931 NON-CURRENT ASSETS: Contract assets 119,281 106,994 Investments 231,281 197,443 Property and equipment, net 1,451,599 1,530,007 Lease assets 2,587,408 2,637,479 Goodwill 19,842,707 15,573,003 Deferred contract costs 834,045 851,972 Deferred tax assets 4,074,545 4,154,878 Intangibles 2,749,965 2,072,957 Other non-current assets 1,175,070 738,641 Total non-current assets 33,065,901 27,863,374 TOTAL ASSETS $ 54,141,319 $ 51,245,305 LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES: Current portion of long-term debt and bank borrowings $ 1,610,025 $ 104,810 Accounts payable 2,251,330 2,491,173 Deferred revenues 5,299,334 4,907,152 Accrued payroll and related benefits 6,416,460 7,506,030 Income taxes payable 557,561 720,778 Lease liabilities 680,484 690,417 Other accrued liabilities 1,392,559 1,588,678 Total current liabilities 18,207,753 18,009,038 NON-CURRENT LIABILITIES: Long-term debt 68,878 43,093 Deferred revenues 621,251 653,954 Retirement obligation 1,629,907 1,595,638 Deferred tax liabilities 516,745 395,280 Income taxes payable 1,389,233 1,313,971 Lease liabilities 2,242,156 2,310,714 Other non-current liabilities 845,654 465,024 Total non-current liabilities 7,313,824 6,777,674 COMMITMENTS AND CONTINGENCIES SHAREHOLDERS' EQUITY: Ordinary shares, par value 1.00 euros per share, 40,000 shares authorized and issued as of May 31, 2024 and August 31, 2023 57 57 Class A ordinary shares, par value $ 0.0000225 per share, 20,000,000,000 shares authorized, 671,948,015 and 664,616,285 shares issued as of May 31, 2024 and August 31, 2023, respectiv

Notes To Consolidated Financial Statements

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 1. Basis of Presentation The accompanying unaudited interim Consolidated Financial Statements of Accenture plc and its controlled subsidiary companies have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC") for quarterly reports on Form 10-Q and do not include all of the information and note disclosures required by U.S. generally accepted accounting principles ("U.S. GAAP") for complete financial statements. We use the terms "Accenture," "we" and "our" in the Notes to Consolidated Financial Statements to refer to Accenture plc and its subsidiaries. These Consolidated Financial Statements should therefore be read in conjunction with the Consolidated Financial Statements and Notes thereto for the fiscal year ended August 31, 2023 included in our Annual Report on Form 10-K filed with the SEC on October 12, 2023. The accompanying unaudited interim Consolidated Financial Statements have been prepared in accordance with U.S. GAAP, which requires management to make estimates and assumptions that affect amounts reported in the Consolidated Financial Statements and accompanying disclosures. Although these estimates are based on management's best knowledge of current events and actions that we may undertake in the future, actual results may differ from those estimates. The Consolidated Financial Statements reflect all adjustments of a normal, recurring nature that are, in the opinion of management, necessary for a fair presentation of results for these interim periods. The results of operations for the three and nine months ended May 31, 2024 are not necessarily indicative of the results that may be expected for the fiscal year ending August 31, 2024. Allowance for Credit Losses—Client Receivables and Contract Assets As of May 31, 2024 and August 31, 2023, the

Notes To Consolidated Financial Statements

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 Depreciation and Amortization As of May 31, 2024 and August 31, 2023, total accumulated depreciation was $ 2,797,314 and $ 2,574,685 , respectively. See table below for a summary of depreciation on fixed assets, deferred transition amortization, intangible assets amortization and operating lease cost for the three and nine months ended May 31, 2024 and 2023, respectively. Three Months Ended Nine Months Ended May 31, 2024 May 31, 2023 May 31, 2024 May 31, 2023 Depreciation $ 138,132 $ 165,053 $ 406,374 $ 446,844 Amortization - Deferred transition 74,196 91,480 265,552 247,080 Amortization - Intangible assets 133,097 101,814 364,353 331,095 Operating lease cost 172,293 240,601 520,522 605,329 Other 3,587 2,151 14,832 9,456 Total depreciation, amortization and other $ 521,305 $ 601,099 $ 1,571,633 $ 1,639,804 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 $ 1.1 billion in fiscal 2023 related to these actions and expect to record approximately $ 450 million in fiscal 2024 for a total of $ 1.5 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. Total b usiness optimization costs by reportable operating segment for the three and nine months ended May 31, 2024 and 2023, respectively, were as follows: Three Months Ended Nine Months Ended May 31, 2024 May 31, 2023 May 31, 2024 May 31, 2023 North America $ ( 3,677 ) $ 96,349 $ 46,941 $ 273,329 EMEA (1) 74,937 167,205 231,302 208,165 Growth Markets (1) 6,160 83,319 54,

Notes To Consolidated Financial Statements

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 2. Revenues Disaggregation of Revenue See Note 12 (Segment Reporting) to these Consolidated Financial Statements for our disaggregated revenues. Remaining Performance Obligations We had remaining performance obligations of approximately $ 29 billion and $ 26 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 35 % of our remaining performance obligations as of May 31, 2024 as revenue in fiscal 2024, an additional 37 % 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 $ 621,251 and $ 653,954 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 $ 834,045 a

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