e10vq
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
|
|
|
þ |
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 |
FOR THE QUARTERLY PERIOD ENDED November 30, 2007
OR
|
|
|
o |
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
FOR THE TRANSITION PERIOD FROM
TO
Commission File Number: 001-16565
ACCENTURE LTD
(Exact name of registrant as specified in its charter)
|
|
|
Bermuda
|
|
98-0341111 |
(State or other jurisdiction of
|
|
(I.R.S. Employer |
incorporation or organization)
|
|
Identification No.) |
Canons Court
22 Victoria Street
Hamilton HM 12, Bermuda
(Address of principal executive offices)
(441) 296-8262
(Registrants telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all reports required to be filed
by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or
for such shorter period that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days. Yes þ No o
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated
filer or a non-accelerated filer. See definition of accelerated filer and large accelerated filer
in Rule 12b-2 of the Exchange Act. (Check one):
Large accelerated filer þ Accelerated filer o Non-accelerated filer o
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of
the Exchange Act). Yes o No þ
The number of shares of the registrants Class A common shares, par value $0.0000225 per
share, outstanding as of December 14, 2007 was 598,265,322 (which number does not include
41,988,745 issued shares held by subsidiaries of the registrant). The number of shares of the
registrants Class X common shares, par value $0.0000225 per share, outstanding as of December 14,
2007 was 155,848,289.
1
ACCENTURE LTD
INDEX
|
|
|
|
|
|
|
|
Page |
Part I. |
|
Financial Information |
|
3 |
Item 1. |
|
Financial Statements |
|
3 |
|
|
Consolidated Balance Sheets as of November 30, 2007 (Unaudited) and August 31, 2007 |
|
3 |
|
|
Consolidated Income Statements (Unaudited) for the three months ended November 30, 2007 and 2006 |
|
4 |
|
|
Consolidated Shareholders Equity and Comprehensive Income Statements (Unaudited) for the three
months ended November 30, 2007 |
|
5 |
|
|
Consolidated Cash Flows Statements (Unaudited) for the three months ended November 30, 2007 and 2006 |
|
6 |
|
|
Notes to Consolidated Financial Statements (Unaudited) |
|
7 |
Item 2. |
|
Managements Discussion and Analysis of Financial Condition and Results of Operations |
|
14 |
Item 3. |
|
Quantitative and Qualitative Disclosures About Market Risk |
|
24 |
Item 4. |
|
Controls and Procedures |
|
24 |
Part II. |
|
Other Information |
|
25 |
Item 1. |
|
Legal Proceedings |
|
25 |
Item 1A. |
|
Risk Factors |
|
26 |
Item 2. |
|
Unregistered Sales of Equity Securities and Use of Proceeds |
|
27 |
Item 3. |
|
Defaults upon Senior Securities |
|
28 |
Item 4. |
|
Submission of Matters to a Vote of Security Holders |
|
28 |
Item 5. |
|
Other Information |
|
28 |
Item 6. |
|
Exhibits |
|
29 |
Signatures |
|
|
|
30 |
2
PART I FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
ACCENTURE LTD
CONSOLIDATED BALANCE SHEETS
November 30, 2007 and August 31, 2007
(In thousands of U.S. dollars, except share and per share amounts)
|
|
|
|
|
|
|
|
|
|
|
November 30, |
|
|
August 31, |
|
|
|
2007 |
|
|
2007 |
|
|
|
(Unaudited) |
|
|
|
|
|
ASSETS |
|
|
|
|
|
|
|
|
CURRENT ASSETS: |
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
2,472,373 |
|
|
$ |
3,314,396 |
|
Short-term investments |
|
|
149,424 |
|
|
|
231,278 |
|
Receivables from clients, net |
|
|
2,739,840 |
|
|
|
2,409,299 |
|
Unbilled services, net |
|
|
1,458,688 |
|
|
|
1,290,035 |
|
Deferred income taxes, net |
|
|
340,662 |
|
|
|
318,172 |
|
Other current assets |
|
|
418,092 |
|
|
|
407,998 |
|
|
|
|
|
|
|
|
Total current assets |
|
|
7,579,079 |
|
|
|
7,971,178 |
|
|
|
|
|
|
|
|
NON-CURRENT ASSETS: |
|
|
|
|
|
|
|
|
Unbilled services, net |
|
|
59,695 |
|
|
|
63,995 |
|
Investments |
|
|
69,100 |
|
|
|
81,935 |
|
Property and
equipment, net of accumulated depreciation of $1,626,919 and
$1,556,146, respectively |
|
|
834,686 |
|
|
|
808,069 |
|
Goodwill |
|
|
690,331 |
|
|
|
643,728 |
|
Deferred income taxes, net |
|
|
631,527 |
|
|
|
389,858 |
|
Other non-current assets |
|
|
883,082 |
|
|
|
788,399 |
|
|
|
|
|
|
|
|
Total non-current assets |
|
|
3,168,421 |
|
|
|
2,775,984 |
|
|
|
|
|
|
|
|
TOTAL ASSETS |
|
$ |
10,747,500 |
|
|
$ |
10,747,162 |
|
|
|
|
|
|
|
|
LIABILITIES AND SHAREHOLDERS EQUITY |
|
|
|
|
|
|
|
|
CURRENT LIABILITIES: |
|
|
|
|
|
|
|
|
Current portion of long-term debt and bank borrowings |
|
$ |
6,404 |
|
|
$ |
23,795 |
|
Accounts payable |
|
|
946,989 |
|
|
|
985,071 |
|
Deferred revenues |
|
|
1,614,886 |
|
|
|
1,785,286 |
|
Accrued payroll and related benefits |
|
|
2,376,691 |
|
|
|
2,274,098 |
|
Income taxes payable |
|
|
195,869 |
|
|
|
942,310 |
|
Deferred income taxes, net |
|
|
45,820 |
|
|
|
39,078 |
|
Other accrued liabilities |
|
|
824,518 |
|
|
|
912,978 |
|
|
|
|
|
|
|
|
Total current liabilities |
|
|
6,011,177 |
|
|
|
6,962,616 |
|
|
|
|
|
|
|
|
NON-CURRENT LIABILITIES: |
|
|
|
|
|
|
|
|
Long-term debt |
|
|
2,066 |
|
|
|
2,565 |
|
Retirement obligation |
|
|
516,699 |
|
|
|
494,416 |
|
Deferred income taxes, net |
|
|
26,861 |
|
|
|
31,758 |
|
Income taxes payable |
|
|
1,064,116 |
|
|
|
32,330 |
|
Other non-current liabilities |
|
|
477,740 |
|
|
|
419,959 |
|
|
|
|
|
|
|
|
Total non-current liabilities |
|
|
2,087,482 |
|
|
|
981,028 |
|
|
|
|
|
|
|
|
COMMITMENTS AND CONTINGENCIES |
|
|
|
|
|
|
|
|
MINORITY INTEREST |
|
|
685,426 |
|
|
|
740,186 |
|
SHAREHOLDERS EQUITY: |
|
|
|
|
|
|
|
|
Preferred shares, 2,000,000,000 shares authorized, zero shares issued and outstanding |
|
|
|
|
|
|
|
|
Class A common shares, par value $0.0000225 per share, 20,000,000,000 shares authorized,
640,164,112
and 635,108,578 shares issued as of November 30, 2007 and August 31, 2007, respectively |
|
|
14 |
|
|
|
14 |
|
Class X common shares, par value $0.0000225 per share, 1,000,000,000 shares authorized,
156,286,142 and
162,629,929 shares issued and outstanding as of November 30, 2007 and August 31, 2007,
respectively |
|
|
4 |
|
|
|
4 |
|
Restricted share units |
|
|
621,332 |
|
|
|
649,475 |
|
Additional paid-in capital |
|
|
51,455 |
|
|
|
|
|
Treasury shares, at cost, 42,083,452 and 39,187,569 shares as of November 30, 2007 and
August 31, 2007,
respectively |
|
|
(1,204,893 |
) |
|
|
(1,033,025 |
) |
Retained earnings |
|
|
2,386,871 |
|
|
|
2,362,703 |
|
Accumulated other comprehensive income |
|
|
108,632 |
|
|
|
84,161 |
|
|
|
|
|
|
|
|
Total shareholders equity |
|
|
1,963,415 |
|
|
|
2,063,332 |
|
|
|
|
|
|
|
|
TOTAL LIABILITIES AND SHAREHOLDERS EQUITY |
|
$ |
10,747,500 |
|
|
$ |
10,747,162 |
|
|
|
|
|
|
|
|
The accompanying Notes are an integral part of these Consolidated Financial Statements.
3
ACCENTURE LTD
CONSOLIDATED INCOME STATEMENTS
For the Three Months Ended November 30, 2007 and 2006
(In thousands of U.S. dollars, except share and per share amounts)
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
2007 |
|
|
2006 |
|
REVENUES: |
|
|
|
|
|
|
|
|
Revenues before reimbursements |
|
$ |
5,673,913 |
|
|
$ |
4,754,088 |
|
Reimbursements |
|
|
428,044 |
|
|
|
412,271 |
|
|
|
|
|
|
|
|
Revenues |
|
|
6,101,957 |
|
|
|
5,166,359 |
|
OPERATING EXPENSES: |
|
|
|
|
|
|
|
|
Cost of services: |
|
|
|
|
|
|
|
|
Cost of services before
reimbursable expenses |
|
|
3,968,836 |
|
|
|
3,321,844 |
|
Reimbursable expenses |
|
|
428,044 |
|
|
|
412,271 |
|
|
|
|
|
|
|
|
Cost of services |
|
|
4,396,880 |
|
|
|
3,734,115 |
|
Sales and marketing |
|
|
520,398 |
|
|
|
436,930 |
|
General and administrative costs |
|
|
449,957 |
|
|
|
379,643 |
|
Reorganization costs, net |
|
|
8,323 |
|
|
|
6,079 |
|
|
|
|
|
|
|
|
Total operating expenses |
|
|
5,375,558 |
|
|
|
4,556,767 |
|
|
|
|
|
|
|
|
OPERATING INCOME |
|
|
726,399 |
|
|
|
609,592 |
|
Gain on investments, net |
|
|
5,471 |
|
|
|
2,854 |
|
Interest income |
|
|
37,780 |
|
|
|
36,307 |
|
Interest expense |
|
|
(5,398 |
) |
|
|
(5,122 |
) |
Other income (expense) |
|
|
9,237 |
|
|
|
(2,466 |
) |
|
|
|
|
|
|
|
INCOME BEFORE INCOME TAXES |
|
|
773,489 |
|
|
|
641,165 |
|
Provision for income taxes |
|
|
267,931 |
|
|
|
235,308 |
|
|
|
|
|
|
|
|
INCOME BEFORE MINORITY
INTEREST |
|
|
505,558 |
|
|
|
405,857 |
|
Minority interest in Accenture SCA and
Accenture Canada Holdings Inc. |
|
|
(119,813 |
) |
|
|
(115,813 |
) |
Minority interest other |
|
|
(4,460 |
) |
|
|
(5,812 |
) |
|
|
|
|
|
|
|
NET INCOME |
|
$ |
381,285 |
|
|
$ |
284,232 |
|
|
|
|
|
|
|
|
|
Weighted average Class A common
shares: |
|
|
|
|
|
|
|
|
Basic |
|
|
611,842,254 |
|
|
|
598,612,668 |
|
Diluted |
|
|
839,271,348 |
|
|
|
875,778,847 |
|
Earnings per Class A common share: |
|
|
|
|
|
|
|
|
Basic |
|
$ |
0.62 |
|
|
$ |
0.47 |
|
Diluted |
|
$ |
0.60 |
|
|
$ |
0.46 |
|
Cash dividends per share |
|
$ |
0.42 |
|
|
$ |
0.35 |
|
The accompanying Notes are an integral part of these Consolidated Financial Statements.
4
ACCENTURE LTD
CONSOLIDATED SHAREHOLDERS EQUITY AND COMPREHENSIVE INCOME STATEMENTS
For the Three Months Ended November 30, 2007
(In thousands of U.S. dollars and in thousands of share amounts)
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Class A |
|
|
Class X |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common |
|
|
Common |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares |
|
|
Shares |
|
|
|
|
|
|
Additional |
|
|
Treasury Shares |
|
|
|
|
|
|
Accumulated Other |
|
|
|
|
|
|
Preferred |
|
|
|
|
|
|
No. |
|
|
|
|
|
|
No. |
|
|
Restricted |
|
|
Paid-in |
|
|
|
|
|
|
No. |
|
|
Retained |
|
|
Comprehensive |
|
|
|
|
|
|
Shares |
|
|
$ |
|
|
Shares |
|
|
$ |
|
|
Shares |
|
|
Share Units |
|
|
Capital |
|
|
$ |
|
|
Shares |
|
|
Earnings |
|
|
Income |
|
|
Total |
|
Balance as of August 31, 2007 |
|
$ |
|
|
|
$ |
14 |
|
|
|
635,109 |
|
|
$ |
4 |
|
|
|
162,630 |
|
|
$ |
649,475 |
|
|
$ |
|
|
|
$ |
(1,033,025 |
) |
|
|
(39,188 |
) |
|
$ |
2,362,703 |
|
|
$ |
84,161 |
|
|
$ |
2,063,332 |
|
Adoption of FASB Interpretation No. 48 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1,756 |
) |
|
|
|
|
|
|
|
|
|
|
15,957 |
|
|
|
|
|
|
|
14,201 |
|
Comprehensive income: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
381,285 |
|
|
|
|
|
|
|
381,285 |
|
Other comprehensive income: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Unrealized gains on marketable
securities, net of reclassification
adjustments |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
10,576 |
|
|
|
10,576 |
|
Foreign currency translation
adjustments |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
13,861 |
|
|
|
13,861 |
|
Amortization of losses related to pension and other
postretirement benefits, net of tax |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
34 |
|
|
|
34 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other comprehensive income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
24,471 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
405,756 |
|
Income tax benefit on share-based compensation plans |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
32,254 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
32,254 |
|
Purchases of Class A common shares |
|
|
|
|
|
|
|
|
|
|
(930 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(19,255 |
) |
|
|
(273,341 |
) |
|
|
(7,543 |
) |
|
|
(18,750 |
) |
|
|
|
|
|
|
(311,346 |
) |
Share-based compensation expense |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
61,114 |
|
|
|
10,569 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
71,683 |
|
Purchases/redemptions of Accenture SCA
Class I common shares, Accenture Canada
Holdings Inc. exchangeable shares and
Class X common shares |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(6,344 |
) |
|
|
|
|
|
|
(307,828 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(307,828 |
) |
Issuances of Class A common shares related
to employee share programs |
|
|
|
|
|
|
|
|
|
|
5,985 |
|
|
|
|
|
|
|
|
|
|
|
(109,896 |
) |
|
|
157,461 |
|
|
|
101,473 |
|
|
|
4,648 |
|
|
|
|
|
|
|
|
|
|
|
149,038 |
|
Dividends |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
20,639 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(354,324 |
) |
|
|
|
|
|
|
(333,685 |
) |
Minority interest |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
180,010 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
180,010 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance as of November 30, 2007 |
|
$ |
|
|
|
$ |
14 |
|
|
|
640,164 |
|
|
$ |
4 |
|
|
|
156,286 |
|
|
$ |
621,332 |
|
|
$ |
51,455 |
|
|
$ |
(1,204,893 |
) |
|
|
(42,083 |
) |
|
$ |
2,386,871 |
|
|
$ |
108,632 |
|
|
$ |
1,963,415 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The accompanying Notes are an integral part of these Consolidated Financial Statements.
5
ACCENTURE LTD
CONSOLIDATED CASH FLOWS STATEMENTS
For the Three Months Ended November 30, 2007 and 2006
(In thousands of U.S. dollars)
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
2007 |
|
|
2006 |
|
CASH FLOWS FROM OPERATING ACTIVITIES: |
|
|
|
|
|
|
|
|
Net income |
|
$ |
381,285 |
|
|
$ |
284,232 |
|
Adjustments to reconcile Net income to Net cash (used in) provided by
operating activities |
|
|
|
|
|
|
|
|
Depreciation, amortization and asset impairments |
|
|
125,168 |
|
|
|
144,981 |
|
Reorganization costs, net |
|
|
8,323 |
|
|
|
6,079 |
|
Share-based compensation expense |
|
|
72,017 |
|
|
|
62,234 |
|
Deferred income taxes, net |
|
|
(32,697 |
) |
|
|
(12,142 |
) |
Minority interest |
|
|
124,273 |
|
|
|
121,625 |
|
Other, net |
|
|
(14,108 |
) |
|
|
1,404 |
|
Change in assets and liabilities, net of acquisitions |
|
|
|
|
|
|
|
|
Receivables from clients, net |
|
|
(331,840 |
) |
|
|
(302,720 |
) |
Other current assets |
|
|
11,175 |
|
|
|
16,155 |
|
Unbilled services, current and non-current |
|
|
(83,771 |
) |
|
|
(115,115 |
) |
Other non-current assets |
|
|
(79,665 |
) |
|
|
(70,449 |
) |
Accounts payable |
|
|
87,576 |
|
|
|
(45,563 |
) |
Deferred revenues |
|
|
(261,543 |
) |
|
|
(81,882 |
) |
Accrued payroll and related benefits |
|
|
(1,752 |
) |
|
|
51,953 |
|
Other accrued liabilities |
|
|
(137,876 |
) |
|
|
(87,833 |
) |
Income taxes payable, current and non-current |
|
|
41,979 |
|
|
|
165,637 |
|
Other non-current liabilities |
|
|
59,985 |
|
|
|
27,232 |
|
|
|
|
|
|
|
|
Net cash (used in) provided by operating activities |
|
|
(31,471 |
) |
|
|
165,828 |
|
|
|
|
|
|
|
|
CASH FLOWS FROM INVESTING ACTIVITIES: |
|
|
|
|
|
|
|
|
Proceeds from maturities and sales of available-for-sale investments |
|
|
119,989 |
|
|
|
333,833 |
|
Purchases of available-for-sale investments |
|
|
(19,132 |
) |
|
|
(272,107 |
) |
Proceeds from sales of property and equipment |
|
|
1,139 |
|
|
|
3,557 |
|
Purchases of property and equipment |
|
|
(88,780 |
) |
|
|
(67,144 |
) |
Purchases of businesses and investments, net of cash acquired |
|
|
(52,375 |
) |
|
|
(4,862 |
) |
Proceeds from sale of business, net of cash transferred |
|
|
1,756 |
|
|
|
|
|
|
|
|
|
|
|
|
Net cash used in investing activities |
|
|
(37,403 |
) |
|
|
(6,723 |
) |
|
|
|
|
|
|
|
CASH FLOWS FROM FINANCING ACTIVITIES: |
|
|
|
|
|
|
|
|
Proceeds from issuance of common shares |
|
|
149,038 |
|
|
|
196,970 |
|
Purchases of common shares |
|
|
(619,174 |
) |
|
|
(723,727 |
) |
Proceeds from long-term debt |
|
|
112 |
|
|
|
1,851 |
|
Repayments of long-term debt |
|
|
(21,142 |
) |
|
|
(21,633 |
) |
Proceeds from short-term borrowings |
|
|
33,583 |
|
|
|
3,091 |
|
Repayments of short-term borrowings |
|
|
(30,748 |
) |
|
|
(2,776 |
) |
Cash dividends paid |
|
|
(333,685 |
) |
|
|
(293,059 |
) |
Excess tax benefits from share-based payment arrangements |
|
|
34,405 |
|
|
|
12,680 |
|
Other, net |
|
|
(3,735 |
) |
|
|
(2,887 |
) |
|
|
|
|
|
|
|
Net cash used in financing activities |
|
|
(791,346 |
) |
|
|
(829,490 |
) |
Effect of exchange rate changes on cash and cash equivalents |
|
|
18,197 |
|
|
|
40,927 |
|
|
|
|
|
|
|
|
NET DECREASE IN CASH AND CASH EQUIVALENTS |
|
|
(842,023 |
) |
|
|
(629,458 |
) |
CASH AND CASH EQUIVALENTS, beginning of period |
|
|
3,314,396 |
|
|
|
3,066,988 |
|
|
|
|
|
|
|
|
CASH AND CASH EQUIVALENTS, end of period |
|
$ |
2,472,373 |
|
|
$ |
2,437,530 |
|
|
|
|
|
|
|
|
The accompanying Notes are an integral part of these Consolidated Financial Statements.
6
ACCENTURE LTD
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of U.S. dollars, except share and per share amounts or as otherwise disclosed)
(Unaudited)
1. BASIS OF PRESENTATION
The accompanying unaudited interim Consolidated Financial Statements of Accenture Ltd, a
Bermuda company, and its controlled subsidiary companies (collectively, the Company) 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 for complete financial statements. 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, 2007 included in the
Companys Annual Report on Form 10-K filed with the SEC on October 23, 2007. The accompanying
unaudited interim Consolidated Financial Statements have been prepared in accordance with U.S.
generally accepted accounting principles and 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 months ended November 30, 2007 are not
necessarily indicative of the results that may be expected for the fiscal year ending August 31,
2008. Certain prior-period amounts have been reclassified to conform to the current-period
presentation.
Recently Adopted Accounting Pronouncements
On September 1, 2007, the Company adopted the provisions of Financial Accounting Standards
Board (FASB) Interpretation No. 48, Accounting for Uncertainty in Income Taxes an
interpretation of FASB Statement No. 109 (FIN 48), which is a change in accounting for income
taxes. FIN 48 specifies how tax benefits for uncertain tax positions are to be recognized, measured
and derecognized in financial statements; requires certain disclosures of uncertain tax matters;
specifies how reserves for uncertain tax positions should be classified in the balance sheet; and
provides transition and interim-period guidance, among other provisions.
The
adoption of FIN 48 had the following approximate impact on the Companys Consolidated Financial
Statements: increased Non-current deferred income tax assets by $228,900; decreased Current income
taxes payable by $757,200; increased Non-current income taxes payable by $971,900; decreased
Additional paid-in capital by $1,800; and increased Retained earnings by $16,000.
As
of September 1, 2007, the Company had gross unrecognized tax
benefits of $1,031,800, of
which $643,700, if recognized, would affect the Companys effective tax rate. The Companys policy,
which has not changed as a result of adopting FIN 48, is to include interest and penalties related
to unrecognized tax benefits in the Provision for income taxes. As of September 1, 2007, the
Company had accrued interest and penalties related to uncertain tax positions of $151,100
($107,400, net of tax benefits) on the Companys Consolidated Balance Sheet.
The Company is currently under audit by the Internal Revenue Service for the tax years 2003 to
2005. The Company does not expect the audit of these years to be effectively settled within the
next 12 months. The Company is also currently under audit in many jurisdictions outside the United
States; none of these audits is individually material to the Companys financial position, results
of operations or cash flows. The Company believes that it is
reasonably possible that approximately $134,000 of its unrecognized
tax benefits, each of which are individually insignificant, may be
resolved in the next 12 months as a result of settlements, lapses of
statutes of limitations and other adjustments.
New Accounting Pronouncements
In December 2007, the FASB issued Statement of Financial Accounting Standards (SFAS) No. 141
(revised 2007), Business Combinations (SFAS
141R or the Statement), which is a
revision of FASB SFAS 141, Business Combinations. This Statement establishes principles and
requirements for how an acquirer: recognizes and measures in its financial statements the
identifiable assets acquired, the liabilities assumed and any noncontrolling interest in the
acquiree; recognizes and measures the goodwill acquired in the business combination or a gain from
a bargain purchase; and determines what information to disclose to enable users of the financial
statements to evaluate the nature and financial effects of the business combination. The Company
will be required to comply with the provisions of SFAS 141R for acquisitions that occur on or after
September 1, 2009. The Company is currently evaluating the impact of SFAS 141R on its Consolidated
Financial Statements.
7
ACCENTURE LTD
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(In thousands of U.S. dollars, except share and per share amounts or as otherwise disclosed)
(Unaudited)
2. EARNINGS PER SHARE
Basic and diluted earnings per share are calculated as follows:
Basic earnings per share
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
|
|
November 30, |
|
|
|
2007 |
|
|
2006 |
|
Net income available for Class A common shareholders |
|
$ |
381,285 |
|
|
$ |
284,232 |
|
Basic weighted average Class A common shares |
|
|
611,842,254 |
|
|
|
598,612,668 |
|
|
|
|
|
|
|
|
Basic earnings per share |
|
$ |
0.62 |
|
|
$ |
0.47 |
|
|
|
|
|
|
|
|
Diluted earnings per share
|
|
|
|
|
|
|
|
|
Net income available for Class A common shareholders |
|
$ |
381,285 |
|
|
$ |
284,232 |
|
Minority interest in Accenture SCA and Accenture Canada Holdings Inc. (1) |
|
|
119,813 |
|
|
|
115,813 |
|
|
|
|
|
|
|
|
Net income per share calculation |
|
$ |
501,098 |
|
|
$ |
400,045 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic weighted average Class A common shares |
|
|
611,842,254 |
|
|
|
598,612,668 |
|
Class A common shares issuable upon redemption/exchange of minority
interest (1) |
|
|
192,212,434 |
|
|
|
243,939,464 |
|
Diluted effect of employee compensation related to Class A common shares |
|
|
35,055,491 |
|
|
|
33,176,532 |
|
Diluted effect of employee share purchase plan related to Class A common
shares |
|
|
161,169 |
|
|
|
50,183 |
|
|
|
|
|
|
|
|
Diluted weighted average Class A common shares |
|
|
839,271,348 |
|
|
|
875,778,847 |
|
|
|
|
|
|
|
|
Diluted earnings per share |
|
$ |
0.60 |
|
|
$ |
0.46 |
|
|
|
|
|
|
|
|
|
|
|
(1) |
|
Diluted earnings per share assumes the redemption and exchange of all Accenture SCA Class
I common shares and Accenture Canada Holdings Inc. exchangeable shares, respectively, for
Accenture Ltd Class A common shares, on a one-for-one basis. The income effect does not take
into account Minority interest other, since those shares are not redeemable or
exchangeable for Accenture Ltd Class A common shares. |
8
ACCENTURE LTD
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(In thousands of U.S. dollars, except share and per share amounts or as otherwise disclosed)
(Unaudited)
3. REORGANIZATION COSTS
In fiscal 2001, the Company accrued reorganization liabilities in connection with its
transition to a corporate structure. These liabilities included certain non-income tax liabilities,
such as stamp taxes, as well as liabilities for certain individual income tax exposures related to
the transfer of interests in certain entities to the Company as part of the reorganization. These
primarily represent unusual and disproportionate individual income tax exposures assumed by
certain, but not all, of the Companys shareholders and partners in certain tax jurisdictions
specifically related to the transfer of their partnership interests in certain entities to the
Company as part of the reorganization. The Company has identified certain shareholders and partners
who may incur such unusual and disproportionate financial damage in certain jurisdictions. These
include shareholders and partners who were subject to tax in their jurisdiction on items of income
arising from the reorganization transaction that were not taxable for most other shareholders and
partners. In addition, certain other shareholders and partners were subject to a different rate or
amount of tax than other shareholders or partners in the same jurisdiction. If additional taxes are
assessed on these shareholders or partners in connection with these transfers, the Company intends
to make payments to reimburse certain costs associated with the assessment either to the
shareholder or partner, or to the taxing authority. The Company has recorded reorganization expense
and the related liability where such liabilities are probable. Interest accruals are made to cover
reimbursement of interest on such tax assessments.
The Companys reorganization activity was as follows:
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
|
|
November 30, |
|
|
|
2007 |
|
|
2006 |
|
Reorganization liability, beginning of period |
|
$ |
401,228 |
|
|
$ |
350,864 |
|
Final determinations (1) |
|
|
(30,242 |
) |
|
|
(822 |
) |
Changes in estimates |
|
|
30,242 |
|
|
|
822 |
|
|
|
|
|
|
|
|
Benefit recorded |
|
|
|
|
|
|
|
|
Interest expense accrued |
|
|
8,323 |
|
|
|
6,079 |
|
Payments |
|
|
(143,184 |
) |
|
|
|
|
Foreign currency translation |
|
|
27,853 |
|
|
|
8,660 |
|
|
|
|
|
|
|
|
Reorganization liability, end of period |
|
$ |
294,220 |
|
|
$ |
365,603 |
|
|
|
|
|
|
|
|
|
|
|
(1) |
|
Includes final agreements with tax authorities and expirations of statutes of
limitations. |
As of November 30, 2007, reorganization liabilities of $268,253 were included in Other accrued
liabilities because expirations of statutes of limitations or other final determinations could
occur within 12 months, and reorganization liabilities of $25,967 were included in Other
non-current liabilities. Resolution of current tax audits, initiation of additional audits or
litigation may delay final settlements. Final settlement will result in a payment on a final
settlement and/or recording a reorganization benefit or cost in the Companys Consolidated Income
Statement.
9
ACCENTURE LTD
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(In thousands of U.S. dollars, except share and per share amounts or as otherwise disclosed)
(Unaudited)
4. ACCUMULATED OTHER COMPREHENSIVE INCOME
The components of Accumulated other comprehensive income were as follows:
|
|
|
|
|
|
|
|
|
|
|
November 30, |
|
|
August 31, |
|
|
|
2007 |
|
|
2007 |
|
Unrealized gains (losses) on marketable securities, net of reclassification
adjustments |
|
$ |
9,262 |
|
|
$ |
(1,314 |
) |
Foreign currency translation adjustments |
|
|
107,722 |
|
|
|
93,861 |
|
Pension and postretirement plans, net of tax of $8,128
and $8,137, respectively |
|
|
(8,352 |
) |
|
|
(8,386 |
) |
|
|
|
|
|
|
|
Accumulated other comprehensive income |
|
$ |
108,632 |
|
|
$ |
84,161 |
|
|
|
|
|
|
|
|
|
Comprehensive income was as follows:
|
|
|
|
November 30, |
|
|
|
2007 |
|
|
2006 |
|
Three months ended |
|
$ |
405,756 |
|
|
$ |
306,450 |
|
5. BUSINESS COMBINATIONS AND GOODWILL
The changes in the carrying amount of goodwill by reportable operating segment are as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreign |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Currency |
|
|
|
|
|
|
August 31, |
|
|
Additions/ |
|
|
Translation |
|
|
November 30, |
|
|
|
2007 |
|
|
Adjustments (1) |
|
|
Adjustments |
|
|
2007 |
|
Communications &
High Tech |
|
$ |
115,197 |
|
|
$ |
14,764 |
|
|
$ |
3,941 |
|
|
$ |
133,902 |
|
Financial Services |
|
|
128,343 |
|
|
|
3,799 |
|
|
|
1,256 |
|
|
|
133,398 |
|
Products |
|
|
287,576 |
|
|
|
11,809 |
|
|
|
3,983 |
|
|
|
303,368 |
|
Public Service |
|
|
71,211 |
|
|
|
5,118 |
|
|
|
1,004 |
|
|
|
77,333 |
|
Resources |
|
|
41,401 |
|
|
|
305 |
|
|
|
624 |
|
|
|
42,330 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
$ |
643,728 |
|
|
$ |
35,795 |
|
|
$ |
10,808 |
|
|
$ |
690,331 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
|
Additions/Adjustments primarily represent acquisitions made during the three months ended
November 30, 2007. |
10
ACCENTURE LTD
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(In thousands of U.S. dollars, except share and per share amounts or as otherwise disclosed)
(Unaudited)
6. RETIREMENT PLANS
In the United States and certain other countries, the Company maintains and administers
retirement plans and postretirement medical plans for certain current, retired and resigned
employees. The components of net periodic pension and postretirement benefits expense were as
follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pension Benefits |
|
|
|
Three Months Ended November 30, |
|
|
|
2007 |
|
|
2006 |
|
Components of pension benefits expense |
|
U.S. Plans |
|
|
Non-U.S. Plans |
|
|
U.S. Plans |
|
|
Non-U.S. Plans |
|
Service cost |
|
$ |
8,325 |
|
|
$ |
12,208 |
|
|
$ |
12,706 |
|
|
$ |
13,327 |
|
Interest cost |
|
|
14,988 |
|
|
|
8,221 |
|
|
|
13,510 |
|
|
|
6,956 |
|
Expected return on plan assets |
|
|
(17,638 |
) |
|
|
(8,928 |
) |
|
|
(14,946 |
) |
|
|
(6,519 |
) |
Amortization of transitional obligation |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(20 |
) |
Amortization
of loss (gain) |
|
|
480 |
|
|
|
(352 |
) |
|
|
325 |
|
|
|
350 |
|
Amortization of prior service cost |
|
|
70 |
|
|
|
111 |
|
|
|
182 |
|
|
|
155 |
|
Curtailment gain |
|
|
(13,898 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
$ |
(7,673 |
) |
|
$ |
11,260 |
|
|
$ |
11,777 |
|
|
$ |
14,249 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Postretirement Benefits |
|
|
|
Three Months Ended November 30, |
|
|
|
2007 |
|
|
2006 |
|
Components of postretirement benefits expense |
|
U.S. Plans |
|
|
Non-U.S. Plans |
|
|
U.S. Plans |
|
|
Non-U.S. Plans |
|
Service cost |
|
$ |
1,744 |
|
|
$ |
360 |
|
|
$ |
1,666 |
|
|
$ |
304 |
|
Interest cost |
|
|
1,653 |
|
|
|
458 |
|
|
|
1,520 |
|
|
|
382 |
|
Expected return on plan assets |
|
|
(409 |
) |
|
|
|
|
|
|
(375 |
) |
|
|
|
|
Amortization of transitional obligation |
|
|
20 |
|
|
|
|
|
|
|
20 |
|
|
|
|
|
Amortization of loss |
|
|
|
|
|
|
19 |
|
|
|
|
|
|
|
16 |
|
Amortization of prior service cost |
|
|
(201 |
) |
|
|
(209 |
) |
|
|
(200 |
) |
|
|
(190 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
$ |
2,807 |
|
|
$ |
628 |
|
|
$ |
2,631 |
|
|
$ |
512 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
11
ACCENTURE LTD
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(In thousands of U.S. dollars, except share and per share amounts or as otherwise disclosed)
(Unaudited)
7. MATERIAL TRANSACTIONS AFFECTING SHAREHOLDERS EQUITY
Share Purchase Activity
The Board of Directors of Accenture Ltd has authorized funding for the Companys publicly
announced open-market share purchase program for acquiring Accenture Ltd Class A common shares and
for redemptions and repurchases of Accenture Ltd Class A common shares, Accenture SCA Class I
common shares and Accenture Canada Holdings Inc. exchangeable shares held by the Companys current
and former senior executives and their permitted transferees.
The Companys share purchase activity during the three months ended November 30, 2007 was as
follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accenture SCA Class I |
|
|
|
|
|
|
|
|
|
Common Shares and |
|
|
|
|
|
|
Accenture Ltd Class A
Common Shares |
|
|
Accenture Canada Holdings Inc. Exchangeable Shares |
|
|
Total |
|
|
|
Shares |
|
|
Amount |
|
|
Shares |
|
|
Amount |
|
|
Shares |
|
|
Amount |
|
Open-market
share purchases |
|
|
6,687,208 |
|
|
$ |
238,330 |
|
|
|
|
|
|
$ |
|
|
|
|
6,687,208 |
|
|
$ |
238,330 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other share
purchase programs |
|
|
|
|
|
|
|
|
|
|
7,827,842 |
|
|
|
307,828 |
|
|
|
7,827,842 |
|
|
|
307,828 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other purchases (1) |
|
|
1,785,696 |
|
|
|
73,016 |
|
|
|
|
|
|
|
|
|
|
|
1,785,696 |
|
|
|
73,016 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
|
8,472,904 |
|
|
$ |
311,346 |
|
|
|
7,827,842 |
|
|
$ |
307,828 |
|
|
|
16,300,746 |
|
|
$ |
619,174 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
|
During the three months ended November 30, 2007, as authorized under the Companys
various employee equity share plans, the Company acquired Accenture Ltd Class A common
shares primarily via share withholding for payroll tax obligations due from employees and
former employees in connection with the delivery of Accenture Ltd Class A common shares
under those plans. |
On October 25, 2007, the Board of Directors of Accenture Ltd authorized an additional
$3,000,000 for share purchases. Management has discretion to use this authorization for purchases
under either the Companys publicly announced open-market share purchase program or its other share
purchase programs.
As of November 30, 2007, the Companys aggregate available authorization was $4,104,148 for
its open-market share purchase program and its other share purchase programs.
Dividend
On November 15, 2007, a cash dividend of $0.42 per share was paid on Accenture Ltds Class A
common shares to shareholders of record at the close of business on October 12, 2007, resulting in
a cash outlay of $252,232. On November 15, 2007, a cash dividend of $0.42 per share was also paid
on Accenture SCAs Class I common shares to shareholders of record at the close of business on
October 9, 2007 and on Accenture Canada Holdings Inc. exchangeable shares to shareholders of record
at the close of business on October 9, 2007, resulting in cash outlays of $80,153 and $1,300,
respectively. The payment of the cash dividends also resulted in the issuance of an immaterial
number of additional restricted share units to holders of restricted share units. Diluted weighted
average Accenture Ltd Class A common share amounts have been restated for all periods presented to
reflect this issuance.
8. COMMITMENTS AND CONTINGENCIES
Commitments and Guarantees
The Company has the right to purchase substantially all of the remaining outstanding shares of
Avanade Inc. (Avanade) not owned by the Company at fair value if certain events occur. The
Company may also be required to purchase substantially all of the remaining outstanding shares of
Avanade at fair value if certain events occur.
The Company has various agreements in which it may be obligated to indemnify other parties
with respect to certain matters. Generally, these indemnification provisions are included in
contracts arising in the normal course of business under which the Company customarily agrees to
hold the indemnified party harmless against losses arising from a breach of representations related
to such matters as title to assets sold, licensed or certain intellectual property rights and other
matters. Payments by the Company under
12
ACCENTURE LTD
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(In thousands of U.S. dollars, except share and per share amounts or as otherwise disclosed)
(Unaudited)
such indemnification clauses are generally conditioned on the other party making a claim. Such
claims are typically subject to challenge by the Company and to dispute resolution procedures
specified in the particular contract. Further, the Companys obligations under these agreements may
be limited in terms of time and/or amount and, in some instances, the Company may have recourse
against third parties for certain payments made by the Company. It is not possible to predict the
maximum potential amount of future payments under these indemnification agreements due to the
conditional nature of the Companys obligations and the unique facts of each particular agreement.
Historically, the Company has not made any payments under these agreements that have been material
individually or in the aggregate. As of November 30, 2007, management was not aware of any
obligations arising under indemnification contracts that would require material payments.
From time to time, the Company enters into contracts with clients whereby it has joint and
several liability with other participants and/or third parties providing related services and
products to clients. Under these arrangements, the Company and other parties may assume some
responsibility to the client or a third party for the performance of others under the terms and
conditions of the contract with or for the benefit of the client or in relation to the performance
of certain contractual obligations. In some arrangements, the extent of the Companys obligations
for the performance of others is not expressly specified. The Company estimates that, as of
November 30, 2007, it had assumed an aggregate potential
liability of approximately $1,125,000 to
its clients for the performance of others under arrangements described in this paragraph. These
contracts typically provide recourse provisions that would allow the Company to recover from the
other parties all but approximately $150,000 if the Company is obligated to make payments to the
clients that are the consequence of a performance default by the other parties. To date, the
Company has not been required to make any payments under any of the contracts described in this
paragraph.
Legal Contingencies
As of November 30, 2007, the Company or its present personnel had been named as a defendant in
various litigation matters. Based on the present status of these litigation matters, management
believes these matters will not ultimately have a
material effect on the Companys results of operations or
financial position.
9. SEGMENT REPORTING
The Companys reportable operating segments are the five operating groups, which are
Communications & High Tech, Financial Services, Products, Public Service (known as Government
prior to September 1, 2007) and Resources. Information regarding the Companys reportable operating
segments is as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended November 30, |
|
|
|
2007 |
|
|
2006 |
|
|
|
Revenues Before |
|
|
Operating |
|
|
Revenues Before |
|
|
Operating |
|
|
|
Reimbursements |
|
|
Income |
|
|
Reimbursements |
|
|
Income |
|
Communications & High Tech |
|
$ |
1,311,732 |
|
|
$ |
128,032 |
|
|
$ |
1,096,390 |
|
|
$ |
134,401 |
|
Financial Services |
|
|
1,243,970 |
|
|
|
179,524 |
|
|
|
1,067,247 |
|
|
|
133,892 |
|
Products |
|
|
1,472,856 |
|
|
|
219,125 |
|
|
|
1,194,668 |
|
|
|
207,079 |
|
Public Service |
|
|
708,962 |
|
|
|
68,378 |
|
|
|
627,828 |
|
|
|
28,362 |
|
Resources |
|
|
930,962 |
|
|
|
131,340 |
|
|
|
762,990 |
|
|
|
105,858 |
|
Other |
|
|
5,431 |
|
|
|
|
|
|
|
4,965 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
$ |
5,673,913 |
|
|
$ |
726,399 |
|
|
$ |
4,754,088 |
|
|
$ |
609,592 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
13
ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion and analysis should be read in conjunction with our Consolidated
Financial Statements and related Notes included elsewhere in this Quarterly Report on Form 10-Q and
in our Annual Report on Form 10-K for the year ended August 31, 2007, and with the information
under the heading Managements Discussion and Analysis of Financial Condition and Results of
Operations in our Annual Report on Form 10-K for the year ended August 31, 2007.
We use the terms Accenture, we, our Company, our and us in this report to refer to
Accenture Ltd and its subsidiaries. All references to years, unless otherwise noted, refer to our
fiscal year, which ends on August 31. For example, a reference to fiscal 2007 means the 12-month
period that ended on August 31, 2007. All references to quarters, unless otherwise noted, refer to
the quarters of our fiscal year.
Disclosure Regarding Forward-Looking Statements
This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934
(the Exchange Act) relating to our operations, results of operations and other matters that are
based on our current expectations, estimates, assumptions and projections. Words such as may,
will, should, likely, anticipates, expects, intends, plans, projects, believes,
estimates and similar expressions are used to identify these forward-looking statements. These
statements are not guarantees of future performance and involve risks, uncertainties and
assumptions that are difficult to predict. Forward-looking statements are based upon assumptions as
to future events that may not prove to be accurate. Actual outcomes and results may differ
materially from what is expressed or forecast in these forward-looking statements. Risks,
uncertainties and other factors that might cause such differences, some of which could be material,
include, but are not limited to:
|
|
|
Our results of operations could be negatively affected if we cannot expand and develop
our services and solutions in response to changes in technology and client demand. |
|
|
|
|
The consulting, systems integration and technology, and outsourcing markets are highly
competitive, and we might not be able to compete effectively. |
|
|
|
|
Our results of operations could be affected by economic and political conditions and the
effects of these conditions on our clients businesses and levels of business activity. |
|
|
|
|
Our work with government clients exposes us to additional risks inherent in the
government contracting environment. |
|
|
|
|
Our business could be adversely affected if our clients are not satisfied with our
services. |
|
|
|
|
We could be subject to liabilities if our subcontractors or the third parties with whom
we partner cannot deliver their project contributions on time or at all. |
|
|
|
|
Our results of operations could be adversely affected if our clients terminate their
contracts with us on short notice. |
|
|
|
|
Outsourcing services are a significant part of our business and subject us to operational
and financial risk. |
|
|
|
|
Our results of operations may be affected by the rate of growth in the use of technology
in business and the type and level of technology spending by our clients. |
|
|
|
|
Our profitability could suffer if we are not able to maintain favorable pricing rates. |
|
|
|
|
Our profitability could suffer if we are not able to maintain favorable utilization
rates. |
|
|
|
|
Our business could be negatively affected if we incur legal liability in connection with
providing our solutions and services. |
14
|
|
|
If our pricing structures do not accurately anticipate the cost and complexity of
performing our work, then our contracts could be unprofitable. |
|
|
|
|
Many of our contracts utilize performance pricing that links some of our fees to the
attainment of various performance or business targets. This could increase the variability
of our revenues and margins. |
|
|
|
|
Our alliance relationships may not be successful. |
|
|
|
|
Our global operations are subject to complex risks, some of which might be beyond our
control. |
|
|
|
|
Our profitability could suffer if we are not able to control our costs. |
|
|
|
|
If we are unable to attract, retain and motivate employees or efficiently utilize their
skills, we might not be able to compete effectively and will not be able to grow our
business. |
|
|
|
|
If we are unable to collect our receivables or unbilled services, our results of
operations and cash flows could be adversely affected. |
|
|
|
|
Our services or solutions could infringe upon the intellectual property rights of others
or we might lose our ability to utilize the intellectual property of others. |
|
|
|
|
We have only a limited ability to protect our intellectual property rights, which are
important to our success. |
|
|
|
|
Tax legislation and negative publicity related to Bermuda companies could lead to an
increase in our tax burden or affect our relationships with our clients. |
|
|
|
|
If we are unable to manage the organizational challenges associated with the size and
expansion of our Company, we might be unable to achieve our business objectives. |
|
|
|
|
We may not be successful at identifying, acquiring or integrating other businesses or
technologies. |
|
|
|
|
Consolidation in the industries that we serve could adversely affect our business. |
|
|
|
|
The share price of Accenture Ltd Class A common shares could be adversely affected from
time to time by sales, or the anticipation of future sales, of Class A common shares held by
our employees and former employees. |
|
|
|
|
Our share price has fluctuated in the past and could continue to fluctuate, including in
response to variability in revenues, operating results and profitability, and as a result
our share price could be difficult to predict. |
|
|
|
|
Our share price could be adversely affected if we are unable to maintain effective
internal controls. |
|
|
|
|
We are registered in Bermuda and a significant portion of our assets are located outside
the United States. As a result, it might not be possible for shareholders to enforce civil
liability provisions of the Federal or state securities laws of the United States. |
|
|
|
|
Bermuda law differs from the laws in effect in the United States and might afford less
protection to shareholders. |
|
|
|
|
We might be unable to access additional capital on favorable terms or at all. If we raise
equity capital, it may dilute our shareholders ownership interest in us. |
For a more detailed discussion of these factors, see the information under the heading Risk
Factors and in our Annual Report on Form 10-K for the year ended August 31, 2007. We undertake no
obligation to update or revise any forward-looking statements.
15
Overview
Revenues are driven by the ability of our executives to secure new contracts and to deliver
solutions and services that add value to our clients. Our ability to add value to clients and
therefore drive revenues depends in part on our ability to deliver market-leading service offerings
and to deploy skilled teams of professionals quickly and on a global basis.
Our results of operations are also affected by the economic conditions, levels of business
activity and rates of change in the industries we serve, as well as by the pace of technological
change and the type and level of technology spending by our clients. The ability to identify and
capitalize on these market and technological changes early in their cycles is a key driver of our
performance. Although we are continuing to see strong demand for our services, we continue to
expect that revenue growth rates across our segments may vary from quarter to quarter during fiscal
2008 as economic conditions vary in different industries and geographic markets.
Revenues before reimbursements for the three months ended November 30, 2007 were $5.67
billion, compared with $4.75 billion for the three months ended November 30, 2006, an increase of
19% in U.S. dollars and 12% in local currency.
Consulting revenues before reimbursements for the three months ended November 30, 2007 were
$3.46 billion, compared with $2.91 billion for the three months ended November 30, 2006, an
increase of 19% in U.S. dollars and 12% in local currency.
Outsourcing revenues before reimbursements for the three months ended November 30, 2007 were
$2.22 billion, compared with $1.84 billion for the three months ended November 30, 2006, an
increase of 20% in U.S. dollars and 14% in local currency. Outsourcing contracts typically have
longer terms than consulting contracts and generally have lower gross margins than consulting
contracts, particularly in the first year. Long-term relationships with many of our clients
continue to contribute to our success in growing our outsourcing business. Consistent with broader
market trends, our recently signed outsourcing contracts continue to be of shorter duration and
therefore of smaller initial total contract value than they have been in the past. Despite this,
our average annualized revenue per contract is steady. Long-term, complex outsourcing contracts,
including their consulting components, require ongoing review of their terms and scope of work, in
light of our clients evolving business needs and our performance expectations. Should the size or
number of modifications to these arrangements increase, as our business continues to grow and these
contracts evolve, we may experience increased variability in expected cash flows, revenues and
profitability.
As we are a global company, our revenues are denominated in multiple currencies and may be
significantly affected by currency exchange-rate fluctuations. During the majority of fiscal 2007
and the first quarter of fiscal 2008, the U.S. dollar weakened against many currencies, resulting
in favorable currency translation and greater reported U.S. dollar revenues, operating expenses and
operating income compared to the same period in the prior year. If this trend continues in the
remainder of fiscal 2008, our U.S. dollar revenue growth will be higher than our growth in local
currency. In the future, if the U.S. dollar strengthens against other currencies, our U.S. dollar
revenue growth may be lower than our growth in local currency.
The primary categories of operating expenses are cost of services, sales and marketing and
general and administrative costs. Cost of services is primarily driven by the cost of
client-service personnel, which consists mainly of compensation, sub-contractor and other personnel
costs, and non-payroll outsourcing costs. Cost of services as a percentage of revenues is driven by
the prices we obtain for our solutions and services, the utilization of our client-service
personnel and the level of non-payroll costs associated with the growth of new outsourcing
contracts. Utilization represents the percentage of our professionals time spent on billable work.
Sales and marketing expense is driven primarily by business-development activities, the development
of new service offerings and client-targeting, image-development and brand-recognition activities.
General and administrative costs primarily include costs for non-client-facing personnel,
information systems and office space, which we seek to manage, as a percentage of revenues, at
levels consistent with or lower than levels in prior-year periods. Operating expenses also include
reorganization costs and benefits, which may vary substantially from year to year.
Gross margin (revenues before reimbursements less cost of services before reimbursements as a
percentage of revenues before reimbursements) for the three months ended November 30, 2007 was
30.1%, flat compared with the three months ended November 30, 2006.
Our cost-management strategy is to anticipate changes in demand for our services and to
identify cost-management initiatives. A primary element of this strategy is to aggressively plan
and manage our payroll costs to meet the anticipated demand for our services, given that payroll
costs are the most significant portion of our operating expenses.
16
Annualized attrition, excluding involuntary terminations, in the first quarter of fiscal 2008
was 17%, compared to 19% in the first quarter of fiscal 2007. We continue to add substantial
numbers of new employees and will continue to actively recruit new employees to balance our mix of
skills and resources to meet current and projected future demands, replace departing employees and
expand our global sourcing approach, which includes our Global Delivery Network and other
capabilities around the world. From time to time, we adjust compensation in certain skill sets and
geographies in order to attract and retain appropriate numbers of qualified employees and we may
need to continue to adjust compensation in the future. In addition, compensation increases, which
for the majority of our personnel were effective September 1, 2007, were higher than in prior
fiscal years. As in prior fiscal years, we have adjusted and expect to continue to adjust pricing
with the objective of recovering these increases. Our margins and ability to grow our business
could be adversely affected if we do not continue to manage attrition, recover increases in
compensation and effectively assimilate and utilize large numbers of new employees.
Sales and marketing and general and administrative costs as a percentage of revenues before
reimbursements were 17.1% for the three months ended November 30, 2007, compared with 17.2% for the
three months ended November 30, 2006.
Operating income as a percentage of revenues before reimbursements for the three months ended
November 30, 2007 was 12.8%, flat compared with the three months ended November 30, 2006.
Bookings and Backlog
New contract bookings for the three months ended November 30, 2007 were $5,915 million, with
consulting bookings of $3,372 million and outsourcing bookings of $2,543 million.
We provide information regarding our new contract bookings because we believe doing so
provides useful trend information regarding changes in the volume of our new business over time.
However, new bookings can vary significantly quarter to quarter depending on the timing of the
signing of a small number of large contracts. Information regarding our new bookings is not
comparable to, nor should it be substituted for, an analysis of our revenues over time. There are
no third-party standards or requirements governing the calculation of bookings. New contract
bookings involve estimates and judgments regarding new contracts as well as renewals, extensions
and additions to existing contracts. Subsequent cancellations, extensions and other matters may
affect the amount of bookings previously reported. New contract bookings are recorded using then
existing currency exchange rates and are not subsequently adjusted for currency fluctuations.
The majority of our contracts are terminable by the client on short notice or without notice.
Accordingly, we do not believe it is appropriate to characterize bookings attributable to these
contracts as backlog. Normally, if a client terminates a project, the client remains obligated to
pay for commitments we have made to third parties in connection with the project, services
performed and reimbursable expenses incurred by us through the date of termination.
Critical Accounting Policies and Estimates
For a description of our critical accounting policies and estimates, see our Annual Report on
Form 10-K for the year ended August 31, 2007.
Revenues by Segment/Operating Group
Our five reportable operating segments are our operating groups, which are Communications &
High Tech, Financial Services, Products, Public Service (known as Government prior to September
1, 2007) and Resources. Operating groups are managed on the basis of revenues before reimbursements
because our management believes revenues before reimbursements are a better indicator of operating
group performance than revenues. From time to time, our operating groups work together to sell and
implement certain contracts. The resulting revenues and costs from these contracts may be
apportioned among the participating operating groups. Generally, operating expenses for each
operating group have similar characteristics and are subject to the same factors, pressures and
challenges. However, the economic environment and its effects on the industries served by our
operating groups affect revenues and operating expenses within our operating groups to differing
degrees. The mix between consulting and outsourcing is not uniform among our operating groups.
Local-currency fluctuations also tend to affect our operating groups differently, depending on the
geographic concentrations and locations of their businesses.
17
Revenues represented by operating group, geographic region and type of work were as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Percent of Total |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenues Before |
|
|
|
|
|
|
|
|
|
|
Percent |
|
|
Reimbursements for |
|
|
|
Three Months Ended |
|
|
Percent |
|
|
Increase |
|
|
the Three Months |
|
|
|
November 30, |
|
|
Increase |
|
|
Local |
|
|
Ended November 30, |
|
|
|
2007 |
|
|
2006 |
|
|
US$ |
|
|
Currency |
|
|
2007 |
|
|
2006 |
|
|
|
(in millions) |
|
|
|
|
|
|
|
|
|
|
|
|
|
OPERATING GROUPS |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Communications & High Tech |
|
$ |
1,312 |
|
|
$ |
1,096 |
|
|
|
20 |
% |
|
|
13 |
% |
|
|
23 |
% |
|
|
23 |
% |
Financial Services |
|
|
1,244 |
|
|
|
1,067 |
|
|
|
17 |
|
|
|
9 |
|
|
|
22 |
|
|
|
23 |
|
Products |
|
|
1,473 |
|
|
|
1,195 |
|
|
|
23 |
|
|
|
17 |
|
|
|
26 |
|
|
|
25 |
|
Public Service |
|
|
709 |
|
|
|
628 |
|
|
|
13 |
|
|
|
8 |
|
|
|
13 |
|
|
|
13 |
|
Resources |
|
|
931 |
|
|
|
763 |
|
|
|
22 |
|
|
|
14 |
|
|
|
16 |
|
|
|
16 |
|
Other |
|
|
5 |
|
|
|
5 |
|
|
|
n/m |
|
|
|
n/m |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL Revenues Before Reimbursements |
|
|
5,674 |
|
|
|
4,754 |
|
|
|
19 |
% |
|
|
12 |
% |
|
|
100 |
% |
|
|
100 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reimbursements |
|
|
428 |
|
|
|
412 |
|
|
|
4 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL REVENUES |
|
$ |
6,102 |
|
|
$ |
5,166 |
|
|
|
18 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
GEOGRAPHIC REGIONS |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Americas |
|
$ |
2,325 |
|
|
$ |
2,090 |
|
|
|
11 |
% |
|
|
9 |
% |
|
|
41 |
% |
|
|
44 |
% |
EMEA (1) |
|
|
2,883 |
|
|
|
2,303 |
|
|
|
25 |
|
|
|
14 |
|
|
|
51 |
|
|
|
48 |
|
Asia Pacific |
|
|
465 |
|
|
|
361 |
|
|
|
29 |
|
|
|
21 |
|
|
|
8 |
|
|
|
8 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL
Revenues Before Reimbursements (2) |
|
$ |
5,674 |
|
|
$ |
4,754 |
|
|
|
19 |
% |
|
|
12 |
% |
|
|
100 |
% |
|
|
100 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TYPE OF WORK |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Consulting |
|
$ |
3,459 |
|
|
$ |
2,909 |
|
|
|
19 |
% |
|
|
12 |
% |
|
|
61 |
% |
|
|
61 |
% |
Outsourcing |
|
|
2,215 |
|
|
|
1,845 |
|
|
|
20 |
|
|
|
14 |
|
|
|
39 |
|
|
|
39 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL Revenues Before Reimbursements |
|
$ |
5,674 |
|
|
$ |
4,754 |
|
|
|
19 |
% |
|
|
12 |
% |
|
|
100 |
% |
|
|
100 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
n/m = not meaningful |
|
(1) |
|
EMEA includes Europe, the Middle East and Africa. |
|
(2) |
|
May not total due to rounding. |
Results of Operations for the Three Months Ended November 30, 2007 Compared to Three Months Ended
November 30, 2006
Revenues
Our Communications & High Tech operating group achieved revenues before reimbursements of
$1,312 million for the three months ended November 30, 2007, compared with $1,096 million for the
three months ended November 30, 2006, an increase of 20% in U.S. dollars and 13% in local currency.
The increase was driven by strong consulting and outsourcing growth in the EMEA and Asia Pacific
regions.
Our Financial Services operating group achieved revenues before reimbursements of $1,244
million for the three months ended November 30, 2007, compared with $1,067 million for the three
months ended November 30, 2006, an increase of 17% in U.S. dollars and 9% in local currency, with
growth driven by outsourcing growth across all industry groups, particularly Banking, in
the EMEA and Americas regions.
Our Products operating group achieved revenues before reimbursements of $1,473 million for the
three months ended November 30, 2007, compared with $1,195 million for the three months ended
November 30, 2006, an increase of 23% in U.S. dollars and 17% in local currency, with consulting
and outsourcing growth across all geographic regions. The increase was primarily driven by strong
growth in the EMEA region, principally in our Consumer Goods & Services, Industrial Equipment and
Automotive industry groups, and in the Americas region, principally in our Health & Life Sciences
and Retail industry groups.
18
Our Public Service operating group achieved revenues before reimbursements of $709 million for
the three months ended November 30, 2007, compared with $628 million for the three months ended
November 30, 2006, an increase of 13% in U.S. dollars and 8% in local currency. The increase was
primarily driven by consulting growth across all geographic regions, particularly EMEA.
Our Resources operating group achieved revenues before reimbursements of $931 million for the
three months ended November 30, 2007, compared with $763 million for the three months ended
November 30, 2006, an increase of 22% in U.S. dollars and 14% in local currency. The increase was
primarily driven by strong consulting growth across all geographic regions and strong outsourcing
growth in the Americas and EMEA regions. Resources experienced strong growth across all four
industry groups: Utilities, Energy, Chemicals and Natural Resources.
In the Americas region, we achieved revenues before reimbursements of $2,325 million for the
three months ended November 30, 2007, compared with $2,090 million for the three months ended
November 30, 2006, an increase of 11% in U.S. dollars and 9% in local currency. Growth was
principally driven by our business in the United States, Brazil and Canada.
In the EMEA region, we achieved revenues before reimbursements of $2,883 million for the three
months ended November 30, 2007, compared with $2,303 million for the three months ended November
30, 2006, an increase of 25% in U.S. dollars and 14% in local currency. Growth was principally
driven by our business in the United Kingdom, Italy, Spain, France, the Netherlands and Germany.
In
the Asia Pacific region, we achieved revenues before reimbursements of $465 million for the
three months ended November 30, 2007, compared with $361 million for the three months ended
November 30, 2006, an increase of 29% in U.S. dollars and 21% in local currency. Growth was
principally driven by our business in Japan, Australia and Singapore.
Operating Expenses
Operating expenses for the three months ended November 30, 2007 were $5,376 million, an
increase of $819 million, or 18%, over the three months ended November 30, 2006, and decreased as a
percentage of revenues to 88.1% from 88.2% during this period. Operating expenses before
reimbursable expenses for the three months ended November 30, 2007 were $4,948 million, an increase
of $804 million, or 19%, over the three months ended November 30, 2006, and remained flat as a
percentage of revenues before reimbursements at 87.2%, compared with the three months ended
November 30, 2006.
Cost of Services
Cost of services for the three months ended November 30, 2007 was $4,397 million, an increase
of $663 million, or 18%, over the three months ended November 30, 2006, and decreased as a
percentage of revenues to 72.1% from 72.3% over this period. Cost of services before reimbursable
expenses for the three months ended November 30, 2007 was $3,969 million, an increase of $647
million, or 19%, over the three months ended November 30, 2006, and remained flat as a percentage
of revenues before reimbursements at 69.9%, compared with the three months ended November 30, 2006.
Gross margin (revenues before reimbursements less cost of services before reimbursements as a
percentage of revenues before reimbursements) for the three months ended November 30, 2007 was
30.1%, flat compared with the three months ended November 30, 2006.
Sales and Marketing
Sales and marketing expense for the three months ended November 30, 2007 was $520 million, an
increase of $83 million, or 19%, over the three months ended November 30, 2006, and remained flat
as a percentage of revenues before reimbursements at 9.2%, compared with the three months ended
November 30, 2006.
General and Administrative Costs
General and administrative costs for the three months ended November 30, 2007 were $450
million, an increase of $70 million, or 19%, over the three months ended November 30, 2006, and
decreased as a percentage of revenues before reimbursements to 7.9% from 8.0% for the three months
ended November 30, 2006.
19
Operating Income
Operating income for the three months ended November 30, 2007 was $726 million, an increase of
$116 million, or 19%, over the three months ended November 30, 2006, and remained flat as a
percentage of revenues before reimbursements at 12.8% for the three months ended November 30, 2007,
compared with the three months ended November 30, 2006.
Operating income for each of the operating
groups was as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended November 30, |
|
|
|
|
|
|
|
|
|
|
|
Increase |
|
|
|
2007 |
|
|
2006 |
|
|
(Decrease) |
|
|
|
(in millions) |
|
Communications & High Tech |
|
$ |
128 |
|
|
$ |
135 |
|
|
$ |
(7 |
) |
Financial Services |
|
|
180 |
|
|
|
134 |
|
|
|
46 |
|
Products |
|
|
219 |
|
|
|
207 |
|
|
|
12 |
|
Public Service |
|
|
68 |
|
|
|
28 |
|
|
|
40 |
|
Resources |
|
|
131 |
|
|
|
106 |
|
|
|
25 |
|
|
|
|
|
|
|
|
|
|
|
Total |
|
$ |
726 |
|
|
$ |
610 |
|
|
$ |
116 |
|
|
|
|
|
|
|
|
|
|
|
Operating income commentary by operating group is as follows:
|
|
|
Communications & High Tech operating income decreased primarily due to delivery
inefficiencies on a consulting contract, partially offset by revenue growth. |
|
|
|
|
Financial Services operating income increased due to revenue growth and improved
outsourcing contract margins. |
|
|
|
|
Products operating income increased due to revenue growth and
reflects slightly lower outsourcing contract profitability. |
|
|
|
|
Public Service operating income increased primarily due to the impact of asset
impairments associated with an outsourcing contract recorded during the first quarter of
fiscal 2007. Operating income for the quarter ended November 30, 2007 also reflects
consulting growth, partially offset by higher sales and marketing costs. |
|
|
|
|
Resources operating income increased due to strong revenue growth and improved
outsourcing contract margins. |
Interest Income
Interest income for the three months ended November 30, 2007 was $38 million, an increase of
$2 million, or 4%, over the three months ended November 30, 2006.
Other Income (Expense)
Other income for the three months ended November 30, 2007 was $9 million, an increase of $12
million over the three months ended November 30, 2006. The increase in other income resulted
primarily from an increase in net foreign currency exchange gains.
20
Provision for Income Taxes
The effective tax rates for the three months ended November 30, 2007 and 2006 were 34.6% and
36.7%, respectively. Beginning with our adoption of Financial Accounting Standards Board (FASB)
Interpretation No. 48, Accounting for Uncertainty in Income Taxes an interpretation of FASB
Statement No. 109 (FIN 48) on September 1, 2007, we recognize the impact of discrete items, such
as changes in unrecognized prior year tax benefits, in the quarter in which they occur. See
Recently Adopted Accounting Pronouncements. Prior to our adoption of FIN 48, we reflected such
items as adjustments to the expected annual effective tax rate instead of as discrete items in the
quarter in which they occurred. As a result, our effective tax rate may vary by quarter and may not
match our expected 2008 annual effective tax rate. The impact of such discrete items was not
significant in the first quarter.
The fiscal 2007 annual effective tax rate was 34.2%. We expect the fiscal 2008 annual
effective tax rate to be in the range of 32% to 34%, which is lower than our fiscal 2007 tax rate
as a result of changes in our geographic distribution of income.
Minority Interest
Minority interest for the three months ended November 30, 2007 was $124 million, an increase
of $2 million, or 2%, over the three months ended November 30, 2006. The increase was primarily due
to an increase in Income before minority interest of
$100 million, offset by a reduction in the Accenture
SCA Class I common shares and Accenture Canada Holdings Inc. exchangeable shares average minority
ownership interest to 24% for the three months ended November 30, 2007 from 29% for the three
months ended November 30, 2006.
Earnings Per Share
Diluted earnings per share were $0.60 for the three months ended November 30, 2007, compared
with $0.46 for the three months ended November 30, 2006. For information regarding our earnings per
share calculations, see Note 2 (Earnings Per Share) to our Consolidated Financial Statements under
Item 1, Financial Statements.
Liquidity and Capital Resources
Our primary sources of liquidity are cash flows from operations, debt capacity available under
various credit facilities and available cash reserves. We may also be able to raise additional
funds through public or private debt or equity financings in order to:
|
|
|
take advantage of opportunities, including more rapid expansion; |
|
|
|
|
acquire complementary businesses or technologies; |
|
|
|
|
develop new services and solutions; |
|
|
|
|
respond to competitive pressures; or |
|
|
|
|
facilitate purchases, redemptions and exchanges of Accenture shares. |
As of November 30, 2007, cash and cash equivalents of $2,472 million combined with $205
million of liquid fixed-income securities that are classified as investments on our Consolidated
Balance Sheet totaled $2,677 million, compared with $3,614 million as of August 31, 2007, a
decrease of $937 million.
21
Cash flows from operating, investing and financing activities, as reflected in the
Consolidated Cash Flows Statements, are summarized in the following table:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended November 30, |
|
|
2007 |
|
2006 |
|
Change |
|
|
|
(1) |
(in millions) |
(1) |
Net cash
(used in) provided by: |
|
|
|
|
|
|
|
|
|
|
|
|
Operating activities |
|
$ |
(31 |
) |
|
$ |
166 |
|
|
$ |
(197 |
) |
Investing activities |
|
|
(37 |
) |
|
|
(7 |
) |
|
|
(30 |
) |
Financing activities |
|
|
(791 |
) |
|
|
(829 |
) |
|
|
38 |
|
Effect of exchange rate changes on cash and cash equivalents |
|
|
18 |
|
|
|
41 |
|
|
|
(23 |
) |
|
|
|
|
|
|
|
|
|
|
Net decrease in cash and cash equivalents |
|
$ |
(842 |
) |
|
$ |
(629 |
) |
|
$ |
(213 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
|
May not total due to rounding. |
Operating
Activities. Cash from operations decreased by $197 million,
compared with the first
three months of fiscal 2007. Cash provided by higher net income was offset by an increase in net
client balances (receivables from clients, current and non-current unbilled services and deferred
revenues) and a payment of $143 million to settle tax audits related to reorganization liabilities.
Investing Activities. The $30 million increase in cash used was primarily due to increased
spending on business acquisitions and property and equipment during the three months ended November
30, 2007, compared with the three months ended November 30, 2006,
offset by a decrease in net purchases of available-for-sale
securities.
Financing Activities. The $38 million decrease in cash used was primarily due to a decrease in
purchases of common shares in the first three months of fiscal 2008,
compared with the first three
months of fiscal 2007, partially offset by an increase in cash dividends paid. For additional
information, see Note 7 (Material Transactions Affecting Shareholders Equity) to our Consolidated
Financial Statements under Item 1, Financial Statements.
We believe that our available cash balances and the cash flows expected to be generated from
operations will be sufficient to satisfy our current and planned working capital and investment
needs for the next twelve months. We also believe that our longer-term working capital and other
general corporate funding requirements will be satisfied through cash flows from operations and, to
the extent necessary, from our borrowing facilities and future financial market activities.
Borrowing Facilities
As of November 30, 2007, we had the following borrowing facilities and related borrowings,
including the issuance of letters of credit, for general working capital purposes:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Borrowings |
|
|
|
|
|
|
|
Under |
|
|
|
Facility Amount |
|
|
Facilities |
|
|
|
(in millions) |
|
Syndicated loan facility |
|
$ |
1,200 |
|
|
$ |
|
|
Separate bilateral, uncommitted, unsecured multicurrency revolving credit facilities |
|
|
350 |
|
|
|
4 |
|
Local guaranteed and non-guaranteed lines of credit |
|
|
150 |
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
$ |
1,700 |
|
|
$ |
4 |
|
|
|
|
|
|
|
|
Under the borrowing facilities described above, we had an aggregate of $154 million of letters
of credit outstanding as of November 30, 2007. In addition, including the amount under the
facilities in the table above, we had total outstanding debt of $8 million, as of November 30,
2007.
22
Share Purchases and Redemptions
The Board of Directors of Accenture Ltd has authorized funding for our publicly announced
open-market share purchase program for acquiring Accenture Ltd Class A common shares and for
redemptions and repurchases of Accenture Ltd Class A common shares, Accenture SCA Class I common
shares and Accenture Canada Holdings Inc. exchangeable shares held by our current and former senior
executives and their permitted transferees.
Our share purchase activity during the three months ended November 30, 2007 was as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accenture SCA Class I |
|
|
|
|
|
|
|
|
|
Common Shares and |
|
|
|
|
|
|
Accenture Ltd Class A
Common Shares |
|
|
Accenture Canada Holdings Inc. Exchangeable Shares |
|
|
Total |
|
|
|
Shares |
|
|
Amount |
|
|
Shares |
|
|
Amount |
|
|
Shares |
|
|
Amount |
|
|
|
(in millions, except share amounts) |
|
Open-market share purchases |
|
|
6,687,208 |
|
|
$ |
238 |
|
|
|
|
|
|
$ |
|
|
|
|
6,687,208 |
|
|
$ |
238 |
|
|
Other share
purchase programs |
|
|
|
|
|
|
|
|
|
|
7,827,842 |
|
|
|
308 |
|
|
|
7,827,842 |
|
|
|
308 |
|
|
Other purchases (1) |
|
|
1,785,696 |
|
|
|
73 |
|
|
|
|
|
|
|
|
|
|
|
1,785,696 |
|
|
|
73 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
|
8,472,904 |
|
|
$ |
311 |
|
|
|
7,827,842 |
|
|
$ |
308 |
|
|
|
16,300,746 |
|
|
$ |
619 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
|
During the three months ended November 30, 2007, as authorized under our various employee
equity share plans, we acquired Accenture Ltd Class A common shares primarily via share
withholding for payroll tax obligations due from employees and former employees in connection
with the delivery of Accenture Ltd Class A common shares under those plans. |
On October 25, 2007, the Board of Directors of Accenture Ltd authorized an additional $3,000
million for share purchases. Management has discretion to use this authorization for purchases
under either our publicly announced open-market share purchase program or our other share purchase
programs.
As of November 30, 2007, our aggregate available authorization was $4,104 million for our
open-market share purchase program and our other share purchase programs.
For a complete description of all share purchase and redemption activity for the first quarter
of fiscal 2008, see Part II, Item 2, Unregistered Sales of Equity Securities and Use of Proceeds.
Obligations and Commitments
We adopted the provisions of FIN 48 on September 1, 2007. See Recently Adopted Accounting
Pronouncements. As of November 30, 2007, we had
approximately $1,100 million of tax liabilities, including
interest and penalties, related to uncertain tax positions. Because of the high degree of
uncertainty regarding the timing of future cash outflows associated with these liabilities, we are
unable to estimate the years in which settlement will occur with the respective taxing authorities.
Off-Balance Sheet Arrangements
We have various agreements by which we may be obligated to indemnify the other party with
respect to certain matters. Generally, these indemnification provisions are included in contracts
arising in the normal course of business under which we customarily agree to hold the indemnified
party harmless against losses arising from a breach of representations related to such matters as
title to assets sold, licensed or certain intellectual property rights and other matters. Payments
by us under such indemnification clauses are generally conditioned on the other party making a
claim. Such claims are generally subject to challenge by us and dispute resolution procedures
specified in the particular contract. Furthermore, our obligations under these arrangements may be
limited in terms of time and/or amount and, in some instances, we may have recourse against third
parties for certain payments made by us. It is not possible to predict the maximum potential amount
of future payments under these indemnification agreements due to the conditional nature of our
obligations and the unique facts of each particular agreement. Historically, we have not made any
payments under these agreements that have been material individually or in the aggregate. As of
November 30, 2007, we were not aware of any obligations under such indemnification agreements that
would require material payments.
From time to time, we enter into contracts with clients whereby we have joint and several
liability with other participants and/or third parties providing related services and products to
clients. Under these arrangements, we and other parties may assume some
23
responsibility to the
client or a third party for the performance of others under the terms and conditions of the
contract with or for the benefit of the client or in relation to the performance of certain
contractual obligations. To date, we have not been required to make any payments under any of the
contracts described in this paragraph. For further discussion of these transactions, see Note 8
(Commitments and Contingencies) to our Consolidated Financial Statements under Item 1, Financial
Statements.
Recently Adopted Accounting Pronouncements
On September 1, 2007, we adopted the provisions of FIN 48, which is a change in accounting for
income taxes. FIN 48 specifies how tax benefits for uncertain tax positions are to be recognized,
measured and derecognized in financial statements; requires certain disclosures of uncertain tax
matters; specifies how reserves for uncertain tax positions should be classified in the balance
sheet; and provides transition and interim-period guidance, among other provisions.
The
adoption of FIN 48 had the following approximate impact on our Consolidated Financial Statements:
increased Non-current deferred income tax assets by $229 million; decreased Current income taxes
payable by $757 million; increased Non-current income taxes payable by $972 million; decreased
Additional paid-in capital by $2 million; and increased Retained earnings by $16 million.
As
of September 1, 2007, we had gross unrecognized tax benefits of
$1,032 million, of which
$644 million, if recognized, would affect our effective tax rate. Our policy, which has not changed
as a result of adopting FIN 48, is to include interest and penalties related to unrecognized tax
benefits in the Provision for income taxes. As of September 1, 2007, we had accrued interest and
penalties related to uncertain tax positions of $151 million ($107 million net of tax benefits) on
our Consolidated Balance Sheet.
We are currently under audit by the Internal Revenue Service for the tax years 2003 to 2005.
We do not expect the audit of these years to be effectively settled within the next 12 months. We
are also currently under audit in many jurisdictions outside the United States; none of these
audits is individually material to our financial position, results of
operations or cash flows. We believe that it is reasonably possible
that approximately $134 million of our unrecognized tax
benefits, each of which are individually insignificant, may be
resolved in the next 12 months as a result of settlements, lapses of
statutes of limitations and other adjustments.
New Accounting Pronouncements
In December 2007, the FASB issued Statement of Financial Accounting Standards (SFAS) No. 141
(revised 2007), Business Combinations (SFAS
141R or the Statement), which is a
revision of FASB SFAS 141, Business Combinations. This Statement establishes principles and
requirements for how an acquirer: recognizes and measures in its financial statements the
identifiable assets acquired, the liabilities assumed and any noncontrolling interest in the
acquiree; recognizes and measures the goodwill acquired in the business combination or a gain from
a bargain purchase; and determines what information to disclose to enable users of the financial
statements to evaluate the nature and financial effects of the business combination. We will be
required to comply with the provisions of SFAS 141R for acquisitions that occur on or after
September 1, 2009. We are currently evaluating the impact of SFAS 141R on our Consolidated
Financial Statements.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
During the three months ended November 30, 2007, there were no material changes in our market
risk exposure. For a discussion of our market risk associated with foreign currency risk, interest
rate risk and equity price risk as of August 31, 2007, see Quantitative and Qualitative
Disclosures about Market Risk in Part II, Item 7A, of our Annual Report on Form 10-K for the year
ended August 31, 2007.
ITEM 4. CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures
An evaluation was performed under the supervision and with the participation of our
management, including our chief executive officer and our chief financial officer, of the
effectiveness of our disclosure controls and procedures (as defined in Rule 13a-15(e) under the
Exchange Act) as of the end of the period covered by this report.
Based on that evaluation, the chief executive officer and the chief financial officer of
Accenture Ltd have concluded that, as of the end of the period covered by this report, Accenture
Ltds disclosure controls and procedures are effective.
24
Changes in Internal Control Over Financial Reporting
There has been no change in Accenture Ltds internal control over financial reporting that
occurred during the first quarter of fiscal 2008 that has materially affected, or is reasonably
likely to materially affect, Accenture Ltds internal control over financial reporting.
PART II OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
We are involved in a number of judicial and arbitration proceedings concerning matters arising
in the ordinary course of our business. We do not expect that any of these matters, individually or
in the aggregate, will have a material impact on our results of
operations or financial position.
As
previously reported, in September 2007, the State of Connecticut filed an action in State Superior Court in
Hartford against Accenture arising out of an alleged data security breach. The action arises in
connection with work we undertook for the State of Connecticuts Office of the Comptroller (the
Core-CT Project), during which Accenture properly came into the possession of confidential
information, including personally identifiable information, concerning Connecticut citizens. The
complaint alleges that some of the information was subsequently placed on a server maintained by
the State of Ohio by Accenture employees who were transferred from the Core-CT Project to a similar
project for the State of Ohio, and that a back-up tape from the Ohio server containing some of the
information was stolen in June 2007 from an Ohio state employee. The State of Connecticut claims
that Accenture breached its contract with the Connecticut Comptrollers office and also asserts
negligence and the unauthorized taking of information by Accenture. The complaint seeks injunctive
relief and damages, including restitution of some unspecified portion of the amount paid to
Accenture pursuant to the Core-CT Project contract. During the investigation of this matter, it was
discovered that confidential information belonging to several other Accenture clients appeared on
the Ohio server, and Accenture has notified the affected clients. Although these events represent a
breach of Accentures internal policies on data security, we have no evidence that any individual
has been harmed as a result. Accenture is committed to maintaining the security of its clients
data and is conducting an internal investigation to ensure the integrity of all confidential data,
including personally identifiable information, in its possession. Accenture is taking proactive
remedial measures to reinforce adherence to its data protection policies. In addition to the
Connecticut suit, it is possible that other affected parties could bring similar lawsuits or
proceedings. We do not believe these matters would have a material impact on our results of
operations or financial condition.
As
previously reported, on April 12, 2007, the U.S. Department of Justice (the DOJ) intervened in a civil qui tam
action previously filed under seal by two private individuals in the U.S. District Court for the
Eastern District of Arkansas against Accenture and several of its indirect subsidiaries. The
complaint alleges that, in connection with work we undertook for the U.S. federal government, we
received payments, resale revenue, or other benefits as a result of alliance agreements we maintain
with technology vendors and others in violation of our contracts with the U.S. government and/or
applicable law or regulations. Similar suits were brought against other companies in our industry.
The total amount of the payments, resale revenue and other benefits alleged in the complaint is $32
million. The suit alleges that these amounts were not disclosed to the government in violation of
the Federal False Claims Act and the Anti-Kickback Act, among other statutes. The DOJ complaint
seeks various remedies including treble damages, statutory penalties and disgorgement of profits.
The suit could lead to other related proceedings by various agencies of the U.S. government,
including potential suspension or debarment proceedings. We intend to defend this matter vigorously
and do not believe this matter will have a material impact on our results of operations or
financial condition.
As
previously reported, in July 2003, we became aware of an incident of possible noncompliance
with the Foreign Corrupt Practices Act and/or with Accentures internal controls in connection with
certain of our operations in the Middle East. In 2003, we voluntarily reported the incident to the
appropriate authorities in the United States promptly after its discovery. Shortly thereafter, the
SEC advised us it would be undertaking an informal investigation of this incident, and the DOJ
indicated it would also conduct a review. Since that time, there have been no further developments.
We do not believe that this incident will have any material impact on our results of operations or
financial condition.
We currently maintain the types and amounts of insurance customary in the industries and
countries in which we operate, including coverage for professional liability, general liability and
management liability. We consider our insurance coverage to be adequate both as to the risks and
amounts for the businesses we conduct.
25
ITEM 1A. RISK FACTORS
For a discussion of our potential risks and uncertainties, see the information under the
heading Risk Factors in our Annual Report on Form 10-K for the year ended August 31, 2007. There
have been no material changes to the risk factors disclosed in our Annual Report on Form 10-K for
the year ended August 31, 2007.
26
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
Purchases and redemptions of Accenture Ltd Class A common shares and Class X common shares
The following table provides information relating to our purchases of Accenture Ltd Class A
common shares and redemptions of Accenture Ltd Class X common shares for the first quarter of
fiscal 2008.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Approximate Dollar |
|
|
|
|
|
|
|
|
|
|
Total Number of Shares |
|
Value of Shares that May |
|
|
Total |
|
|
|
|
|
Purchased as Part of |
|
Yet Be Purchased Under |
|
|
Number of Shares |
|
Average Price |
|
Publicly Announced |
|
Publicly Announced Plans |
Period |
|
Purchased |
|
Paid per Share |
|
Plans or Programs (1) |
|
or Programs (2) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(in millions) |
September 1,
2007 September 30, 2007 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Class A common shares |
|
|
1,335,763 |
|
|
$ |
41.35 |
|
|
|
|
|
|
$ |
900 |
|
Class X common shares |
|
|
|
|
|
$ |
0.0000225 |
|
|
|
|
|
|
|
|
|
October 1,
2007 October 31, 2007 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Class A common shares |
|
|
139,972 |
|
|
$ |
40.54 |
|
|
|
|
|
|
$ |
3,900 |
|
Class X common shares |
|
|
4,606,957 |
|
|
$ |
0.0000225 |
|
|
|
|
|
|
|
|
|
November 1, 2007 November
30, 2007 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Class A common shares |
|
|
6,997,169 |
|
|
$ |
35.79 |
|
|
|
6,687,208 |
|
|
$ |
3,661 |
|
Class X common shares |
|
|
1,736,830 |
|
|
$ |
0.0000225 |
|
|
|
|
|
|
|
|
|
Total |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Class A common shares
(1)(3) |
|
|
8,472,904 |
|
|
$ |
36.75 |
|
|
|
6,687,208 |
|
|
|
|
|
Class X common shares (4) |
|
|
6,343,787 |
|
|
$ |
0.0000225 |
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
|
Since August 2001, the Board of Directors of Accenture Ltd has authorized and periodically
confirmed a publicly announced open-market share purchase program for acquiring Accenture Ltd
Class A common shares. During the first quarter of fiscal 2008, we repurchased 6,687,208
Accenture Ltd Class A common shares under this program for an aggregate purchase price of $238
million. The open-market purchase program does not have an expiration date. |
|
(2) |
|
To date, the Board of Directors of Accenture Ltd has authorized an aggregate of $11.1 billion
for share repurchases. This includes $3.0 billion authorized on
October 25, 2007, which management has the discretion to use for
purchases under either our publicly announced open-market share
purchase program or our other share purchase programs. This
authorization is included in the column above. As of November
30, 2007, our aggregate available authorization was $4,104 million for our open-market share
purchase program and our other share purchase programs. |
|
(3) |
|
During the first quarter of fiscal 2008, Accenture purchased 1,785,696 Accenture Ltd Class A
common shares in transactions unrelated to publicly announced share plans or programs. These
transactions consisted primarily of acquisitions of Accenture Ltd Class A common shares via
share withholding for payroll tax obligations due from employees and former employees in
connection with the delivery of Accenture Ltd Class A common shares under our various employee
equity share plans. |
|
(4) |
|
During the first quarter of fiscal 2008, we redeemed 6,343,787 Accenture Ltd Class X common
shares pursuant to our Bye-laws. Accenture Ltd Class X common shares are redeemable at their
par value of $0.0000225 per share. |
Purchases and redemptions of Accenture SCA Class I common shares and Accenture Canada Holdings Inc.
exchangeable shares
The following table provides additional information relating to our purchases and redemptions
of Accenture SCA Class I common shares and Accenture Canada Holdings Inc. exchangeable shares
during the first quarter of fiscal 2008. Management believes that the following table and footnotes
provide useful information regarding the share purchase and redemption activity of Accenture.
Generally, purchases and redemptions of Accenture SCA Class I common shares and Accenture Canada
Holdings Inc. exchangeable shares reduce shares outstanding for purposes of computing diluted
earnings per share.
27
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Approximate Dollar |
|
|
|
|
|
|
|
|
|
|
Total Number of Shares |
|
Value of Shares that May |
|
|
|
|
|
|
|
|
|
|
Purchased as Part of |
|
Yet Be Purchased Under |
|
|
Total |
|
|
|
|
|
Purchased as Part of |
|
Yet Be Purchased Under |
|
|
Number of Shares |
|
Average Price |
|
Publicly Announced |
|
Publicly Announced Plans |
Period |
|
Purchased (1) |
|
Paid per Share |
|
Plans or Programs |
|
or
Programs (2) |
Accenture SCA |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
September 1,
2007 September 30, 2007 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Class I common shares |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
October 1,
2007 October 31, 2007 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Class I common shares |
|
|
5,726,385 |
|
|
$ |
40.35 |
|
|
|
|
|
|
|
|
|
November 1, 2007 November
30, 2007 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Class I common shares |
|
|
1,965,096 |
|
|
$ |
36.34 |
|
|
|
|
|
|
|
|
|
Total |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Class I common shares |
|
|
7,691,481 |
|
|
$ |
39.33 |
|
|
|
|
|
|
|
|
|
Accenture Canada Holdings Inc. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
September 1,
2007 September 30, 2007 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Exchangeable shares |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
October 1,
2007 October 31, 2007 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Exchangeable shares |
|
|
82,325 |
|
|
$ |
40.60 |
|
|
|
|
|
|
|
|
|
November 1, 2007 November
30, 2007 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Exchangeable shares |
|
|
54,036 |
|
|
$ |
36.80 |
|
|
|
|
|
|
|
|
|
Total |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Exchangeable shares |
|
|
136,361 |
|
|
$ |
39.09 |
|
|
|
|
|
|
|
|
|
|
|
|
(1) |
|
During the first quarter of fiscal 2008, Accenture redeemed and purchased a total of
7,691,481 Accenture SCA Class I common shares and 136,361 Accenture Canada Holdings Inc.
exchangeable shares from current and former senior executives and their permitted transferees. |
|
(2) |
|
To date, the Board of Directors of Accenture Ltd has authorized an aggregate of $11.1 billion
for share repurchases. This includes $3.0 billion authorized on
October 25, 2007, which management has the discretion to use for
purchases under either our publicly announced open-market share
purchase program or our other share purchase programs. As of November 30, 2007, our aggregate available authorization was
$4,104 million for our open-market share purchase program and our other share purchase
programs. |
Purchases and redemptions of Accenture SCA Class II and Class III common shares
Transactions involving Accenture SCA Class II and Class III common shares consist exclusively
of inter-company transactions undertaken to facilitate other corporate purposes. These
inter-company transactions do not affect shares outstanding for purposes of computing earnings per
share reflected in our Consolidated Financial Statements under Item 1, Financial Statements.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None.
ITEM 5. OTHER INFORMATION
(a) None.
(b) None.
28
ITEM 6. EXHIBITS
Exhibit Index:
|
|
|
Exhibit |
|
|
Number |
|
Exhibit |
3.1
|
|
Form of Bye-laws of the Registrant, effective as of February 2, 2005 (incorporated by reference
to Exhibit 3.1 to the February 28, 2005 10-Q) |
|
|
|
3.2
|
|
Form of Articles of Association of
Accenture SCA, updated as of December 14, 2007 |
|
|
|
31.1
|
|
Certification of the Chief 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 |
|
|
|
31.2
|
|
Certification of the Chief 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 |
|
|
|
32.1
|
|
Certification of the Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 |
|
|
|
32.2
|
|
Certification of the Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 |
29
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:
December 21, 2007
|
|
|
|
|
|
ACCENTURE LTD
|
|
|
By: |
/s/ Pamela J. Craig
|
|
|
|
Name: |
Pamela J. Craig |
|
|
|
Title: |
Chief Financial Officer |
|
|
30