Table of ContentsContents


UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
____________________ 
FORM 10-Q
☑QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended
November 30, 2019
ORFor the quarterly period endedNovember 30, 2020
OR
☐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: 001-34448

acn-20201130_g1.gif
Accenture plc
(Exact name of registrant as specified in its charter)
Ireland98-0627530
(State or other jurisdiction of

incorporation or organization)
(I.R.S. Employer

Identification No.)
1 Grand Canal Square,,
Grand Canal Harbour,,
Dublin2,, Ireland
(Address of principal executive offices)
(353) (1) (353) (1) 646-2000
(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Class A ordinary shares, par value $0.0000225 per shareACNNew York Stock Exchange

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. Yesþ ☑ No ¨☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yesþ ☑ No ¨☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer☑Accelerated filer☐Non-accelerated filer☐
Smaller reporting company☐Emerging growth company☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No þ☑
The number of shares of the registrant’s Class A ordinary shares, par value $0.0000225 per share, outstanding as of December 2, 20197, 2020 was 656,946,050661,135,130 (which number includes 21,902,50726,889,663 issued shares held by the registrant). The number of shares of the registrant’s Class X ordinary shares, par value $0.0000225 per share, outstanding as of December 2, 20197, 2020 was 593,689.526,879.


Table of Contents


ACCENTURE PLC
INDEX
Page
Part I.
3
Item 1.
3
3
4
5
6
8
9
Item 2.
2119
Item 3.
2928
Item 4.
3028
Part II.
3129
Item 1.
3129
Item 1A.
3129
Item 2.
3129
Item 3.
3229
Item 4.
30
Item 5.
30
Item 6.
30
3231


32Consolidated Financial Statements
(In thousands of U.S. dollars, except share and per share amounts)
32
Signatures
33
3

2
Table of Contents


PARTPart I — FINANCIAL INFORMATIONFinancial Information
ITEM 1. FINANCIAL STATEMENTS
ACCENTURE PLC
CONSOLIDATED BALANCE SHEETS
Item 1. FinancialStatements
Consolidated Balance Sheets
November 30, 20192020 and August 31, 20192020
(In thousands of U.S. dollars, except share and per share amounts)
 November 30,
2019		 August 31,
2019
 (Unaudited)  
ASSETS   
CURRENT ASSETS:   
Cash and cash equivalents$5,810,537
 $6,126,853
Short-term investments3,303
 3,313
Receivables and contract assets8,577,386
 8,095,071
Other current assets1,214,878
 1,225,364
Total current assets15,606,104
 15,450,601
NON-CURRENT ASSETS:   
Contract assets58,071
 71,002
Investments278,765
 240,313
Property and equipment, net1,386,440
 1,391,166
Lease assets3,154,501
 —
Goodwill6,300,004
 6,205,550
Deferred contract costs691,727
 681,492
Deferred tax assets4,300,909
 4,349,464
Other non-current assets1,394,191
 1,400,292
Total non-current assets17,564,608
 14,339,279
TOTAL ASSETS$33,170,712
 $29,789,880
LIABILITIES AND SHAREHOLDERS’ EQUITY   
CURRENT LIABILITIES:   
Current portion of long-term debt and bank borrowings$3,698
 $6,411
Accounts payable1,581,112
 1,646,641
Deferred revenues2,986,524
 3,188,835
Accrued payroll and related benefits4,652,038
 4,890,542
Income taxes payable448,010
 378,017
Lease liabilities710,787
 —
Other accrued liabilities817,239
 951,450
Total current liabilities11,199,408
 11,061,896
NON-CURRENT LIABILITIES:   
Long-term debt15,935
 16,247
Deferred revenues585,301
 565,224
Retirement obligation1,784,347
 1,765,914
Deferred tax liabilities144,659
 133,232
Income taxes payable905,952
 892,688
Lease liabilities2,651,651
 —
Other non-current liabilities282,251
 526,988
Total non-current liabilities6,370,096
 3,900,293
COMMITMENTS AND CONTINGENCIES

 

SHAREHOLDERS’ EQUITY:   
Ordinary shares, par value 1.00 euros per share, 40,000 shares authorized and issued as of November 30, 2019 and August 31, 201957
 57
Class A ordinary shares, par value $0.0000225 per share, 20,000,000,000 shares authorized, 656,946,050 and 654,739,267 shares issued as of November 30, 2019 and August 31, 2019, respectively15
 15
Class X ordinary shares, par value $0.0000225 per share, 1,000,000,000 shares authorized, 593,689 and 609,404 shares issued and outstanding as of November 30, 2019 and August 31, 2019, respectively—
 —
Restricted share units1,525,898
 1,411,903
Additional paid-in capital6,162,252
 5,804,448
Treasury shares, at cost: Ordinary, 40,000 shares as of November 30, 2019 and August 31, 2019; Class A ordinary, 21,950,289 and 18,964,863 shares as of November 30, 2019 and August 31, 2019, respectively(1,977,391) (1,388,376)
Retained earnings11,236,275
 10,421,538
Accumulated other comprehensive loss(1,779,968) (1,840,577)
Total Accenture plc shareholders’ equity15,167,138
 14,409,008
Noncontrolling interests434,070
 418,683
Total shareholders’ equity15,601,208
 14,827,691
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY$33,170,712
 $29,789,880

November 30, 2020August 31, 2020
ASSETS(Unaudited)
CURRENT ASSETS:
Cash and cash equivalents$8,594,003 $8,415,330 
Short-term investments83,148 94,309 
Receivables and contract assets8,547,711 7,846,892 
Other current assets1,401,232 1,393,225 
Total current assets18,626,094 17,749,756 
NON-CURRENT ASSETS:
Contract assets44,517 43,257 
Investments298,906 324,514 
Property and equipment, net1,506,825 1,545,568 
Lease assets3,100,120 3,183,346 
Goodwill8,127,411 7,709,820 
Deferred contract costs715,897 723,168 
Deferred tax assets4,178,723 4,153,146 
Other non-current assets1,669,818 1,646,018 
Total non-current assets19,642,217 19,328,837 
TOTAL ASSETS$38,268,311 $37,078,593 
LIABILITIES AND SHAREHOLDERS’ EQUITY
CURRENT LIABILITIES:
Current portion of long-term debt and bank borrowings$8,925 $7,820 
Accounts payable1,513,442 1,349,874 
Deferred revenues3,524,781 3,636,741 
Accrued payroll and related benefits5,179,301 5,083,950 
Income taxes payable445,824 453,542 
Lease liabilities732,878 756,057 
Accrued consumption taxes706,876 662,409 
Other accrued liabilities707,072 712,197 
Total current liabilities12,819,099 12,662,590 
NON-CURRENT LIABILITIES:
Long-term debt59,881 54,052 
Deferred revenues668,267 690,931 
Retirement obligation1,875,976 1,859,444 
Deferred tax liabilities201,376 179,703 
Income taxes payable995,478 930,695 
Lease liabilities2,627,185 2,667,584 
Other non-current liabilities594,833 534,421 
Total non-current liabilities7,022,996 6,916,830 
COMMITMENTS AND CONTINGENCIES
SHAREHOLDERS’ EQUITY:
Ordinary shares, par value 1.00 euros per share, 40,000 shares authorized and issued as of November 30, 2020 and August 31, 202057 57 
Class A ordinary shares, par value $0.0000225 per share, 20,000,000,000 shares authorized, 660,518,888 and 658,548,895 shares issued as of November 30, 2020 and August 31, 2020, respectively15 15 
Class X ordinary shares, par value $0.0000225 per share, 1,000,000,000 shares authorized, 526,879 and 527,509 shares issued and outstanding as of November 30, 2020 and August 31, 2020, respectively0 0 
Restricted share units1,721,681 1,585,302 
Additional paid-in capital7,551,089 7,167,227 
Treasury shares, at cost: Ordinary, 40,000 shares as of November 30, 2020 and August 31, 2020; Class A ordinary, 26,898,686 and 24,383,369 shares as of November 30, 2020 and August 31, 2020, respectively(3,163,841)(2,565,761)
Retained earnings13,276,702 12,375,533 
Accumulated other comprehensive loss(1,479,202)(1,561,837)
Total Accenture plc shareholders’ equity17,906,501 17,000,536 
Noncontrolling interests519,715 498,637 
Total shareholders’ equity18,426,216 17,499,173 
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY$38,268,311 $37,078,593 
The accompanying Notes are an integral part of these Consolidated Financial Statements.

3
Table of Contents


Consolidated Financial Statements
(In thousands of U.S. dollars, except share and per share amounts)
ACCENTURE FORM 10-Q
4
ACCENTURE PLCConsolidated Income Statements
CONSOLIDATED INCOME STATEMENTS
For the Three Months Ended November 30, 20192020 and 2018
(In thousands of U.S. dollars, except share and per share amounts)2019
(Unaudited)
 2019 2018
REVENUES:   
Revenues$11,358,958
 $10,605,546
OPERATING EXPENSES:   
Cost of services7,711,199
 7,308,121
Sales and marketing1,191,123
 1,070,016
General and administrative costs689,373
 598,397
Total operating expenses9,591,695
 8,976,534
OPERATING INCOME1,767,263
 1,629,012
Interest income27,419
 19,631
Interest expense(5,474) (4,505)
Other income (expense), net11,439
 (33,654)
INCOME BEFORE INCOME TAXES1,800,647
 1,610,484
Income tax expense425,479
 319,160
NET INCOME1,375,168
 1,291,324
Net income attributable to noncontrolling interest in Accenture Canada Holdings Inc.(1,741) (1,888)
Net income attributable to noncontrolling interests – other(16,459) (14,716)
NET INCOME ATTRIBUTABLE TO ACCENTURE PLC$1,356,968
 $1,274,720
Weighted average Class A ordinary shares:   
Basic635,722,309
 638,877,445
Diluted649,389,444
 652,151,450
Earnings per Class A ordinary share:   
Basic$2.13
 $2.00
Diluted$2.09
 $1.96
Cash dividends per share$0.80
 $1.46

20202019
REVENUES:
Revenues$11,762,185 $11,358,958 
OPERATING EXPENSES:
Cost of services7,863,889 7,711,199 
Sales and marketing1,227,176 1,191,123 
General and administrative costs780,451 689,373 
Total operating expenses9,871,516 9,591,695 
OPERATING INCOME1,890,669 1,767,263 
Interest income10,685 27,419 
Interest expense(8,854)(5,474)
Other income (expense), net94,367 11,439 
INCOME BEFORE INCOME TAXES1,986,867 1,800,647 
Income tax expense464,810 425,479 
NET INCOME1,522,057 1,375,168 
Net income attributable to noncontrolling interest in Accenture Canada Holdings Inc.(1,700)(1,741)
Net income attributable to noncontrolling interests – other(20,081)(16,459)
NET INCOME ATTRIBUTABLE TO ACCENTURE PLC$1,500,276 $1,356,968 
Weighted average Class A ordinary shares:
Basic634,271,482 635,722,309 
Diluted646,879,735 649,389,444 
Earnings per Class A ordinary share:
Basic$2.37 $2.13 
Diluted$2.32 $2.09 
Cash dividends per share$0.88 $0.80 
The accompanying Notes are an integral part of these Consolidated Financial Statements.

4
Table of Contents


Consolidated Financial Statements
(In thousands of U.S. dollars)
ACCENTURE FORM 10-Q
5
ACCENTURE PLCConsolidated Statements Of Comprehensive Income
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
For the Three Months Ended November 30, 20192020 and 2018
(In thousands of U.S. dollars)2019
(Unaudited)
 2019 2018
NET INCOME$1,375,168
 $1,291,324
OTHER COMPREHENSIVE INCOME (LOSS), NET OF TAX:   
Foreign currency translation37,730
 (8,617)
Defined benefit plans8,752
 20,413
Cash flow hedges14,127
 88,344
Investments—
 (515)
OTHER COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO ACCENTURE PLC60,609
 99,625
Other comprehensive income (loss) attributable to noncontrolling interests1,180
 (2,296)
COMPREHENSIVE INCOME$1,436,957
 $1,388,653



 

COMPREHENSIVE INCOME ATTRIBUTABLE TO ACCENTURE PLC$1,417,577
 $1,374,345
Comprehensive income attributable to noncontrolling interests19,380
 14,308
COMPREHENSIVE INCOME$1,436,957
 $1,388,653

20202019
NET INCOME$1,522,057 $1,375,168 
OTHER COMPREHENSIVE INCOME (LOSS), NET OF TAX:
Foreign currency translation67,312 37,730 
Defined benefit plans10,881 8,752 
Cash flow hedges4,393 14,127 
Investments49 0 
OTHER COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO ACCENTURE PLC82,635 60,609 
Other comprehensive income (loss) attributable to noncontrolling interests1,461 1,180 
COMPREHENSIVE INCOME$1,606,153 $1,436,957 
COMPREHENSIVE INCOME ATTRIBUTABLE TO ACCENTURE PLC$1,582,911 $1,417,577 
Comprehensive income attributable to noncontrolling interests23,242 19,380 
COMPREHENSIVE INCOME$1,606,153 $1,436,957 
The accompanying Notes are an integral part of these Consolidated Financial Statements.


5

Table of Contents


Consolidated Financial Statements
(In thousands of U.S. dollars and share amounts)
ACCENTURE FORM 10-Q
6
ACCENTURE PLCConsolidated Shareholders’ Equity Statement
CONSOLIDATED SHAREHOLDERS’ EQUITY STATEMENT
For the Three Months Ended November 30, 2019
(In thousands of U.S. dollars and share amounts)2020
(Unaudited)
 Ordinary
Shares		 Class A
Ordinary
Shares		 Class X
Ordinary
Shares		 Restricted
Share
Units		 Additional
Paid-in
Capital		 Treasury Shares Retained
Earnings		 Accumulated
Other
Comprehensive
Loss		 Total
Accenture plc
Shareholders’
Equity		 Noncontrolling
Interests		 Total
Shareholders’
Equity
 $ No.
Shares		 $ No.
Shares		 $ No.
Shares		   $ No.
Shares		     
Balance as of August 31, 2019$57
 40
 $15
 654,739
 $—
 609
 $1,411,903
 $5,804,448
 $(1,388,376) (19,005) $10,421,538
 $(1,840,577) $14,409,008
 $418,683
 $14,827,691
Net income                    1,356,968
   1,356,968
 18,200
 1,375,168
Other comprehensive income (loss)                      60,609
 60,609
 1,180
 61,789
Purchases of Class A shares              811
 (724,618) (3,821)     (723,807) (811) (724,618)
Share-based compensation expense            238,677
 36,252
         274,929
   274,929
Purchases/redemptions of Accenture Canada Holdings Inc. exchangeable shares and Class X shares          (15)   (4,593)         (4,593)   (4,593)
Issuances of Class A shares for employee share programs      2,207
     (142,925) 323,660
 135,603
 836
 (16,263)   300,075
 325
 300,400
Dividends            18,243
       (525,968)   (507,725) (656) (508,381)
Other, net              1,674
         1,674
 (2,851) (1,177)
Balance as of November 30, 2019$57
 40
 $15
 656,946
 $—
 594
 $1,525,898
 $6,162,252
 $(1,977,391) (21,990) $11,236,275
 $(1,779,968) $15,167,138
 $434,070
 $15,601,208

 Ordinary
Shares		Class A
Ordinary
Shares		Class X
Ordinary
Shares		Restricted
Share
Units		Additional
Paid-in
Capital		Treasury SharesRetained
Earnings		Accumulated
Other
Comprehensive
Loss		Total
Accenture plc
Shareholders’
Equity		Noncontrolling
Interests		Total
Shareholders’
Equity
 $No.
Shares		$No.
Shares		$No.
Shares		$No.
Shares
Balance as of August 31, 2020$57 40 $15 658,549 $0 528 $1,585,302 $7,167,227 $(2,565,761)(24,423)$12,375,533 $(1,561,837)$17,000,536 $498,637 $17,499,173 
Net income1,500,276 1,500,276 21,781 1,522,057 
Other comprehensive income (loss)82,635 82,635 1,461 84,096 
Purchases of Class A shares765 (768,395)(3,341)(767,630)(765)(768,395)
Share-based compensation expense270,226 41,095 311,321 311,321 
Purchases/redemptions of Accenture Canada Holdings Inc. exchangeable shares and Class X shares(1)(500)(500)(500)
Issuances of Class A shares for employee share programs1,970 (153,073)343,783 170,315 825 (22,462)338,563 328 338,891 
Dividends19,226 (576,645)(557,419)(633)(558,052)
Other, net(1,281)(1,281)(1,094)(2,375)
Balance as of November 30, 2020$57 40 $15 660,519 $0 527 $1,721,681 $7,551,089 $(3,163,841)(26,939)$13,276,702 $(1,479,202)$17,906,501 $519,715 $18,426,216 
The accompanying Notes are an integral part of these Consolidated Financial Statements.

6

Table of Contents


Consolidated Financial Statements
(In thousands of U.S. dollars and share amounts)
ACCENTURE FORM 10-Q
7
ACCENTURE PLCConsolidated Shareholders’ Equity Statement — (continued)
CONSOLIDATED SHAREHOLDERS’ EQUITY STATEMENT
For the Three Months Ended November 30, 2018
(In thousands of U.S. dollars and share amounts)2019
(Unaudited)
 Ordinary
Shares		 Class A
Ordinary
Shares		 Class X
Ordinary
Shares		 Restricted
Share
Units		 Additional
Paid-in
Capital		 Treasury Shares Retained
Earnings		 Accumulated
Other
Comprehensive
Loss		 Total
Accenture plc
Shareholders’
Equity		 Noncontrolling
Interests		 Total
Shareholders’
Equity
 $ No.
Shares		 $ No.
Shares		 $ No.
Shares		   $ No.
Shares		     
Balance as of August 31, 2018$57
 40
 $15
 663,328
 $—
 656
 $1,234,623
 $4,870,764
 $(2,116,948) (24,333) $7,952,413
 $(1,576,171) $10,364,753
 $359,835
 $10,724,588
Cumulative effect adjustment                    2,134,818
   2,134,818
 3,158
 2,137,976
Net income                    1,274,720
   1,274,720
 16,604
 1,291,324
Other comprehensive income (loss)                      99,625
 99,625
 (2,296) 97,329
Purchases of Class A shares              1,026
 (787,508) (4,861)     (786,482) (1,026) (787,508)
Share-based compensation expense            214,713
 31,803
         246,516
   246,516
Purchases/redemptions of Accenture Canada Holdings Inc. exchangeable shares and Class X shares          (5)   (819)         (819) 

 (819)
Issuances of Class A shares for employee share programs      2,213
     (133,965) 277,039
 156,008
 988
 (33,244)   265,838
 344
 266,182
Dividends      
     27,594
 

     (959,054)   (931,460) (1,378) (932,838)
Other, net      

       (3,064)     14,411
   $11,347
 $1,471
 $12,818
Balance as of November 30, 2018$57
 40
 $15
 665,541
 $—
 651
 $1,342,965
 $5,176,749
 $(2,748,448) (28,206) $10,384,064
 $(1,476,546) $12,678,856
 $376,712
 $13,055,568

 Ordinary
Shares		Class A
Ordinary
Shares		Class X
Ordinary
Shares		Restricted
Share
Units		Additional
Paid-in
Capital		Treasury SharesRetained
Earnings		Accumulated
Other
Comprehensive
Loss		Total
Accenture plc
Shareholders’
Equity		Noncontrolling
Interests		Total
Shareholders’
Equity
 $No.
Shares		$No.
Shares		$No.
Shares		$No.
Shares
Balance as of August 31, 2019$57 40 $15 654,739 $0 609 $1,411,903 $5,804,448 $(1,388,376)(19,005)$10,421,538 $(1,840,577)$14,409,008 $418,683 $14,827,691 
Net income1,356,968 1,356,968 18,200 1,375,168 
Other comprehensive income (loss)60,609 60,609 1,180 61,789 
Purchases of Class A shares811 (724,618)(3,821)(723,807)(811)(724,618)
Share-based compensation expense238,677 36,252 274,929 274,929 
Purchases/redemptions of Accenture Canada Holdings Inc. exchangeable shares and Class X shares(15)(4,593)(4,593)(4,593)
Issuances of Class A shares for employee share programs2,207 (142,925)323,660 135,603 836 (16,263)300,075 325 300,400 
Dividends18,243 (525,968)(507,725)(656)(508,381)
Other, net1,674 1,674 (2,851)(1,177)
Balance as of November 30, 2019$57 40 $15 656,946 $0 594 $1,525,898 $6,162,252 $(1,977,391)(21,990)$11,236,275 $(1,779,968)$15,167,138 $434,070 $15,601,208 
The accompanying Notes are an integral part of these Consolidated Financial Statements.


7

Consolidated Financial Statements
(In thousands of U.S. dollars)
ACCENTURE FORM 10-Q
8
Table of Contents


Consolidated Cash Flows Statements
ACCENTURE PLC
CONSOLIDATED CASH FLOWS STATEMENTS
For the Three Months Ended November 30, 20192020 and 2018
(In thousands of U.S. dollars)2019
(Unaudited)
2019 201820202019
CASH FLOWS FROM OPERATING ACTIVITIES:   CASH FLOWS FROM OPERATING ACTIVITIES:
Net income$1,375,168
 $1,291,324
Net income$1,522,057 $1,375,168 
Adjustments to reconcile Net income to Net cash provided by (used in) operating activities —   Adjustments to reconcile Net income to Net cash provided by (used in) operating activities —
Depreciation, amortization and other399,458
 211,685
Depreciation, amortization and other468,200 399,458 
Share-based compensation expense274,929
 246,516
Share-based compensation expense311,321 274,929 
Deferred tax expense (benefit)36,591
 (2,634)Deferred tax expense (benefit)(19,096)36,591 
Other, net(120,927) (42,244)Other, net(103,806)(120,927)
Change in assets and liabilities, net of acquisitions —   Change in assets and liabilities, net of acquisitions —
Receivables and contract assets, current and non-current(436,872) (536,882)Receivables and contract assets, current and non-current(594,475)(436,872)
Other current and non-current assets(101,096) (155,787)Other current and non-current assets(18,129)(101,096)
Accounts payable(61,929) (14,487)Accounts payable148,495 (61,929)
Deferred revenues, current and non-current(185,313) 13,280
Deferred revenues, current and non-current(151,356)(185,313)
Accrued payroll and related benefits(261,592) 81,117
Accrued payroll and related benefits48,385 (261,592)
Income taxes payable, current and non-current84,840
 (47,554)Income taxes payable, current and non-current34,755 84,840 
Other current and non-current liabilities(216,346) (16,826)Other current and non-current liabilities(43,506)(216,346)
Net cash provided by (used in) operating activities786,911
 1,027,508
Net cash provided by (used in) operating activities1,602,845 786,911 
CASH FLOWS FROM INVESTING ACTIVITIES:   CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment(95,063) (77,691)Purchases of property and equipment(93,115)(95,063)
Purchases of businesses and investments, net of cash acquired(109,848) (200,417)Purchases of businesses and investments, net of cash acquired(503,843)(109,848)
Proceeds from sales of businesses and investments39,200
 441
Proceeds from sales of businesses and investments149,002 39,200 
Other investing, net(182) 4,799
Other investing, net1,549 (182)
Net cash provided by (used in) investing activities(165,893) (272,868)Net cash provided by (used in) investing activities(446,407)(165,893)
CASH FLOWS FROM FINANCING ACTIVITIES:   CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of shares300,400
 266,182
Proceeds from issuance of shares338,891 300,400 
Purchases of shares(729,211) (788,327)Purchases of shares(768,895)(729,211)
Proceeds from (repayments of) long-term debt, net(570) (369)Proceeds from (repayments of) long-term debt, net(82)(570)
Cash dividends paid(508,381) (932,838)Cash dividends paid(558,052)(508,381)
Other, net(10,462) (6,816)Other, net(11,313)(10,462)
Net cash provided by (used in) financing activities(948,224) (1,462,168)Net cash provided by (used in) financing activities(999,451)(948,224)
Effect of exchange rate changes on cash and cash equivalents10,890
 9,958
Effect of exchange rate changes on cash and cash equivalents21,686 10,890 
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS(316,316) (697,570)NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS178,673 (316,316)
CASH AND CASH EQUIVALENTS, beginning of period
6,126,853
 5,061,360
CASH AND CASH EQUIVALENTS, beginning of period
8,415,330 6,126,853 
CASH AND CASH EQUIVALENTS, end of period
$5,810,537
 $4,363,790
CASH AND CASH EQUIVALENTS, end of period
$8,594,003 $5,810,537 
SUPPLEMENTAL CASH FLOW INFORMATION:   SUPPLEMENTAL CASH FLOW INFORMATION:
Income taxes paid, net$292,787
 $297,166
Income taxes paid, net$344,628 $292,787 
The accompanying Notes are an integral part of these Consolidated Financial Statements.

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ACCENTURE PLC

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of U.S. dollars, except share and per share amounts or as otherwise disclosed)
(Unaudited)



Notes To Consolidated Financial Statements
(In thousands of U.S. dollars, except share and per share amounts or as otherwise disclosed)
ACCENTURE FORM 10-Q
9
1. BASIS OF PRESENTATION
1. Basis Of Presentation
The accompanying unaudited interim Consolidated Financial Statements of Accenture plc and its controlled subsidiary companies have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) for quarterly reports on Form 10-Q and do not include all of the information and note disclosures required by U.S. generally accepted accounting principles (“U.S. GAAP”) for complete financial statements. We use the terms “Accenture,” “we” and “our” in the Notes to Consolidated Financial Statements to refer to Accenture plc and its subsidiaries. These Consolidated Financial Statements should therefore be read in conjunction with the Consolidated Financial Statements and Notes thereto for the fiscal year ended August 31, 20192020 included in our Annual Report on Form 10-K filed with the SEC on October 29, 2019.22, 2020.
The accompanying unaudited interim Consolidated Financial Statements have been prepared in accordance with U.S. GAAP, which requires management to make estimates and assumptions that affect amounts reported in the Consolidated Financial Statements and accompanying disclosures. Although these estimates are based on management’s best knowledge of current events and actions that we may undertake in the future, actual results may differ from those estimates. The Consolidated Financial Statements reflect all adjustments of a normal, recurring nature that are, in the opinion of management, necessary for a fair presentation of results for these interim periods. The results of operations for the three months ended November 30, 20192020 are not necessarily indicative of the results that may be expected for the fiscal year ending August 31, 2020.2021.
AllowancesAllowance for Credit Losses - Client Receivables and Contract Assets
We record client receivables and contract assets at their face amounts less an allowance for credit losses. The allowance represents our estimate of expected credit losses based on historical experience, current economic conditions and certain forward-looking information. As of November 30, 20192020 and August 31, 2019,2020, the total allowancesallowance for credit losses recorded for client receivables were $45,016 and $45,538,contract assets was $38,315 and $40,277, respectively. The change in the allowance is primarily due to immaterial write-offs and changes in gross client receivables and contract assets.
Concentrations of Credit Risk
Our financial instruments, consisting primarily of cash and cash equivalents, foreign currency exchange rate instruments and client receivables, are exposed to concentrations of credit risk. We place our cash and cash equivalents and foreign exchange instruments with highly-rated financial institutions, limit the amount of credit exposure with any one financial institution and conduct ongoing evaluations of the credit worthiness of the financial institutions with which we do business. Client receivables are dispersed across many different industries and countries; therefore, concentrations of credit risk are limited.
Investments
All available-for-sale securities and liquid investments with an original maturity greater than three months but less than one year are considered to be Short-term investments. Non-current investments consist of equity securities in publicly-traded and privately-held companies and are accounted for using either the equity or fair value measurement alternative method of accounting (for investments without readily determinable fair values).
Our non-current investments are as follows:
November 30, 2020August 31, 2020
Equity method investments$211,765 $240,446 
Investments without readily determinable fair values87,141 84,068 
Total non-current investments$298,906 $324,514 
For investments in which we can exercise significant influence but do not control, we use the equity method of accounting. Equity method investments are initially recorded at cost and our proportionate share of gains and losses of the investee are included as a component of other income (expense), net. Our equity method investments consist primarily of an investment in Duck Creek Technologies. As of November 30, 2020 and August 31, 2020, the carrying amount of our investment was $201,810 and $230,219, and the estimated fair value of our approximately 19% and 22% ownership was $850,825 and $956,308, respectively.

Notes To Consolidated Financial Statements
(In thousands of U.S. dollars, except share and per share amounts or as otherwise disclosed)
ACCENTURE FORM 10-Q
10
We account for the investment under the equity method because we have the ability to influence operations through the combination of our voting power and through other factors, such as representation on the board and our business relationship.
Depreciation and Amortization
Depreciation expenseAs of November 30, 2020 and August 31, 2020, total accumulated depreciation was $97,090$2,414,951 and $102,713$2,313,731, respectively. See table below for summary of depreciation on fixed assets, deferred transition amortization, intangible assets amortization and operating lease cost for the three months ended November 30, 2020 and 2019, and 2018, respectively. As of November 30, 2019 and August 31, 2019, total accumulated depreciation was $2,096,462 and $1,956,029, respectively. Deferred transition amortization expense was $67,914 and $68,879 for the three months ended November 30, 2019 and 2018, respectively. See Note 6 (Goodwill and Intangible Assets) to these Consolidated Financial Statements for intangible asset amortization balances.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (continued)
(In thousands of U.S. dollars, except share and per share amounts or as otherwise disclosed)
(Unaudited)


 Three Months Ended
 November 30, 2020November 30, 2019
Depreciation$133,918 $97,090 
Amortization - Deferred transition81,356 67,914 
Amortization - Intangible assets67,207 53,372 
Other - Operating lease cost185,719 181,082 
Total depreciation, amortization and other$468,200 $399,458 
Recently Adopted Accounting Pronouncements
Financial Accounting Standards Board (“FASB”) Accounting Standards Update (“ASU”) No. 2016-02 and related updates2016-13 (“Topic 842”326”)
On September 1, 2019,2020, we adopted FASB ASU No. 2016-02, Leases,2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, which amends guidance on recognition and measurement of credit losses and related updates (“Topic 842”) usingdisclosures. The amendments replace the effective date method. Prior period amounts were not adjusted. The primary impact of adoption is the requirementexisting incurred loss impairment model with a methodology to measure and recognize lifetime expected credit losses for lessees to recognizeall in-scope financial assets, including accounts receivable and liabilities on the balance sheet for the rights and obligations created by both operating and finance leases. Enhanced quantitative and qualitative disclosures about leasing arrangements are also required. We elected the package of practical expedients which does not require reassessment of prior conclusions related to identifying leases, lease classification or initial direct costs. We also elected the practical expedient to combine lease and nonlease components, accounting for the combined components as a single lease component, for our office real estate and automobile leases. The standard did not have a material impact on our Consolidated Income Statement.
The impact of adopting Topic 842 on our Consolidated Balance Sheets was as follows:
Balance SheetBalance as of August 31, 2019 Adjustments due to ASU 2016-02 (Topic 842) Balance as of September 1, 2019
CURRENT ASSETS     
Other current assets$1,225,364
 $(38,666) $1,186,698
NON-CURRENT ASSETS     
Lease assets—
 3,169,608
 3,169,608
Other non-current assets1,400,292
 (10,333) 1,389,959
CURRENT LIABILITIES     
Lease liabilities—
 699,399
 699,399
Other accrued liabilities951,450
 (703) 950,747
NON-CURRENT LIABILITIES     
Lease liabilities—
 2,666,344
 2,666,344
Other non-current liabilities526,988
 (244,431) 282,557

See Note 7 (Leases) to these Consolidated Financial Statements for further details.
FASB ASU No. 2018-09 (“Subtopic 350-40”)
On September 1, 2019, we prospectively adopted FASB ASU No. 2018-15, Intangibles - Goodwill and Other - Internal-Use Software: Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract. ASU 2018-15 clarifies and aligns the accounting and capitalization of implementation costs in cloud computing arrangements that are service arrangements with the accounting for implementation costs incurred to develop or obtain internal-use software under ASC No. 350-40. Implementation costs that are currently capitalized in software licensing arrangements (e.g. costs to configure the software) will be capitalized in cloud computing arrangements, and costs expensed in software license arrangements (e.g. data conversion, training, and business process re-engineering) will be expensed in cloud computing arrangements.contract assets. The adoption did not have a materialan impact on our Consolidated Financial Statements.





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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (continued)
(In thousands of U.S. dollars, except share and per share amounts or as otherwise disclosed)
(Unaudited)


2. REVENUES




Notes To Consolidated Financial Statements
(In thousands of U.S. dollars, except share and per share amounts or as otherwise disclosed)
ACCENTURE FORM 10-Q
11
2. Revenues
Disaggregation of Revenue
See Note 1211 (Segment Reporting) to these Consolidated Financial Statements for our disaggregated revenues.
Remaining Performance Obligations
We had remaining performance obligations of approximately $19 billion and $20 billion as of November 30, 20192020 and August 31, 2019,2020, respectively. Our remaining performance obligations represent the amount of transaction price for which work has not been performed and revenue has not been recognized. The majority of our contracts are terminable by the client on short notice with little or no termination penalties, and some without notice. Under Topic 606, only the non-cancelable portion of these contracts is included in our performance obligations. Additionally, our performance obligations only include variable consideration if we assess it is probable that a significant reversal of cumulative revenue recognized will not occur when the uncertainty is resolved. Based on the terms of our contracts, a significant portion of what we consider contract bookings is not included in our remaining performance obligations. We expect to recognize approximately 61%62% of our remaining performance obligations as of November 30, 20192020 as revenue in fiscal 2020,2021, an additional 19% in fiscal 2021,2022, and the balance thereafter.
Contract Estimates
Adjustments in contract estimates related to performance obligations satisfied or partially satisfied in prior periods were immaterial for the three months ended November 30, 20192020 and 2018,2019, respectively.
Contract Balances
Deferred transition revenues were $583,531$668,267 and $563,245$690,931 as of November 30, 20192020 and August 31, 2019,2020, respectively, and are included in Non-current deferred revenues. Costs related to these activities are also deferred and are expensed as the services are provided. Deferred transition costs were $715,897 and $723,168 as of November 30, 2020 and August 31, 2020, respectively, and are included in Deferred contract costs. Generally, deferred amounts are protected in the event of early termination of the contract and are monitored regularly for impairment. Impairment losses are recorded when projected remaining undiscounted operating cash flows of the related contract are not sufficient to recover the carrying amount of contract assets. Deferred transition costs were $691,727 and $681,492 as of November 30, 2019 and August 31, 2019, respectively, and are included in Deferred contract costs.
The following table provides information about the balances of our Receivables and Contract assets, net of allowance, and Contract liabilities (Deferred revenues):
 As of November 30, 2019 As of August 31, 2019
Receivables, net of allowance$7,908,781
 $7,467,338
Contract assets (current)668,605
 627,733
Receivables and contract assets (current)8,577,386
 8,095,071
Contract assets (non-current)58,071
 71,002
Deferred revenues (current)2,986,524
 3,188,835
Deferred revenues (non-current)585,301
 565,224

As of November 30, 2020As of August 31, 2020
Receivables$7,799,770 $7,192,110 
Contract assets (current)747,941 654,782 
Receivables and contract assets, net of allowance (current)8,547,711 7,846,892 
Contract assets (non-current)44,517 43,257 
Deferred revenues (current)3,524,781 3,636,741 
Deferred revenues (non-current)668,267 690,931 
Changes in the contract asset and liability balances during the three months ended November 30, 2019,2020, were a result of normal business activity and not materially impacted by any other factors.
Revenues recognized during the three months ended November 30, 2020 that were included in Deferred revenues as of August 31, 2020 were $2.0 billion. Revenues recognized during the three months ended November 30, 2019 that were included in Deferred revenues as of August 31, 2019 were $1.8 billion. Revenues recognized during the three months ended November 30, 2018 that were included in Deferred revenues as of September 1, 2018 were $1.8 billion.

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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (continued)
(In thousands of U.S. dollars, except share and per share amounts or as otherwise disclosed)
(Unaudited)


Notes To Consolidated Financial Statements
(In thousands of U.S. dollars, except share and per share amounts or as otherwise disclosed)
ACCENTURE FORM 10-Q
12
3. EARNINGS PER SHAREEarnings Per Share
Basic and diluted earnings per share wereare calculated as follows:
 Three Months Ended
 November 30, 2020November 30, 2019
Basic earnings per share
Net income attributable to Accenture plc$1,500,276 $1,356,968 
Basic weighted average Class A ordinary shares634,271,482 635,722,309 
Basic earnings per share$2.37 $2.13 
Diluted earnings per share
Net income attributable to Accenture plc$1,500,276 $1,356,968 
Net income attributable to noncontrolling interest in Accenture Canada Holdings Inc. (1)1,700 1,741 
Net income for diluted earnings per share calculation$1,501,976 $1,358,709 
Basic weighted average Class A ordinary shares634,271,482 635,722,309 
Class A ordinary shares issuable upon redemption/exchange of noncontrolling interest (1)718,767 815,515 
Diluted effect of employee compensation related to Class A ordinary shares11,633,343 12,626,225 
Diluted effect of share purchase plans related to Class A ordinary shares256,143 225,395 
Diluted weighted average Class A ordinary shares646,879,735 649,389,444 
Diluted earnings per share$2.32 $2.09 
(1)Diluted earnings per share assumes the exchange of all Accenture Canada Holdings Inc. exchangeable shares for Accenture plc Class A ordinary shares on a one-for-one basis. The income effect does not take into account “Net income attributable to noncontrolling interests - other,” since those shares are not redeemable or exchangeable for Accenture plc Class A ordinary shares.



 Three Months Ended
 November 30, 2019 November 30, 2018
Basic earnings per share   
Net income attributable to Accenture plc$1,356,968
 $1,274,720
Basic weighted average Class A ordinary shares635,722,309
 638,877,445
Basic earnings per share$2.13
 $2.00
Diluted earnings per share   
Net income attributable to Accenture plc$1,356,968
 $1,274,720
Net income attributable to noncontrolling interest in Accenture Canada Holdings Inc. (1)1,741
 1,888
Net income for diluted earnings per share calculation$1,358,709
 $1,276,608
Basic weighted average Class A ordinary shares635,722,309
 638,877,445
Class A ordinary shares issuable upon redemption/exchange of noncontrolling interest (1)815,515
 945,336
Diluted effect of employee compensation related to Class A ordinary shares12,626,225
 12,093,353
Diluted effect of share purchase plans related to Class A ordinary shares225,395
 235,316
Diluted weighted average Class A ordinary shares649,389,444
 652,151,450
Diluted earnings per share$2.09
 $1.96
_______________
(1)
Table of Contents
Diluted earningsNotes To Consolidated Financial Statements
(In thousands of U.S. dollars, except share and per share assumes the exchange of all Accenture Canada Holdings Inc. exchangeable shares for Accenture plc Class A ordinary shares on a one-for-one basis. The income effect does not take into account “Net income attributable to noncontrolling interests - other,” since those shares are not redeemableamounts or exchangeable for Accenture plc Class A ordinary shares. as otherwise disclosed)
ACCENTURE FORM 10-Q
13


4. Accumulated Other Comprehensive Loss

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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 LOSS
The following table summarizes the changes in the accumulated balances for each component of accumulated other comprehensive loss attributable to Accenture plc:
Three Months Ended
November 30, 2020November 30, 2019
Foreign currency translation
    Beginning balance$(1,010,279)$(1,207,975)
             Foreign currency translation67,443 40,145 
             Income tax benefit (expense)1,313 (1,264)
             Portion attributable to noncontrolling interests(1,444)(1,151)
             Foreign currency translation, net of tax67,312 37,730 
    Ending balance(942,967)(1,170,245)
Defined benefit plans
    Beginning balance(615,223)(672,323)
             Reclassifications into net periodic pension and
post-retirement expense (1)		13,595 12,784 
             Income tax benefit (expense)(2,702)(4,021)
             Portion attributable to noncontrolling interests(12)(11)
             Defined benefit plans, net of tax10,881 8,752 
    Ending balance(604,342)(663,571)
Cash flow hedges
    Beginning balance63,714 38,993 
             Unrealized gain (loss)25,364 38,408 
             Reclassification adjustments into Cost of services(20,895)(20,019)
             Income tax benefit (expense)(71)(4,244)
             Portion attributable to noncontrolling interests(5)(18)
             Cash flow hedges, net of tax4,393 14,127 
    Ending balance (2)68,107 53,120 
Investments
    Beginning balance(49)728 
             Unrealized gain (loss)49 0 
             Income tax benefit (expense)0 0 
             Portion attributable to noncontrolling interests0 0 
             Investments, net of tax49 0 
    Ending balance0 728 
Accumulated other comprehensive loss$(1,479,202)$(1,779,968)
(1)Reclassifications into net periodic pension and post-retirement expense are recognized in Cost of services, Sales and marketing, General and administrative costs and non-operating expenses.
(2)As of November 30, 2020, $66,522 of net unrealized gains related to derivatives designated as cash flow hedges is expected to be reclassified into Cost of services in the next twelve months.
 Three Months Ended
 November 30, 2019 November 30, 2018
Foreign currency translation   
    Beginning balance$(1,207,975) $(1,075,268)
             Foreign currency translation40,145
 (12,396)
             Income tax benefit (expense)(1,264) 1,324
             Portion attributable to noncontrolling interests(1,151) 2,455
             Foreign currency translation, net of tax37,730
 (8,617)
    Ending balance(1,170,245) (1,083,885)
    
Defined benefit plans   
    Beginning balance(672,323) (419,284)
             Reclassifications into net periodic pension and
post-retirement expense (1)		12,784
 22,894
             Income tax benefit (expense)(4,021) (2,451)
             Portion attributable to noncontrolling interests(11) (30)
             Defined benefit plans, net of tax8,752
 20,413
    Ending balance(663,571) (398,871)
    
Cash flow hedges   
    Beginning balance38,993
 (84,010)
             Unrealized gain (loss)38,408
 115,678
             Reclassification adjustments into Cost of services(20,019) 1,878
             Income tax benefit (expense)(4,244) (29,082)
             Portion attributable to noncontrolling interests(18) (130)
             Cash flow hedges, net of tax14,127
 88,344
    Ending balance (2)53,120
 4,334
    
Investments   
    Beginning balance728
 2,391
             Unrealized gain (loss)—
 (516)
             Portion attributable to noncontrolling interests—
 1
             Investments, net of tax—
 (515)
    Ending balance728
 1,876
    
Accumulated other comprehensive loss$(1,779,968) $(1,476,546)
_______________
(1)
Reclassifications into net periodic pensionNotes To Consolidated Financial Statements
(In thousands of U.S. dollars, except share and post-retirement expense are recognized in Cost of services, Sales and marketing, General and administrative costs and non-operating expenses.per share amounts or as otherwise disclosed)
(2)
As of ACCENTURENovember 30, 2019, $49,723 of net unrealized gains related to derivatives designated as cash flow hedges is expected to be reclassified into Cost of services in the next twelve months. FORM 10-Q
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5. Business Combinations
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ACCENTURE PLC

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (continued)
(In thousands of U.S. dollars, except share and per share amounts or as otherwise disclosed)
(Unaudited)


5. BUSINESS COMBINATIONS
During the three months ended November 30, 2019,2020, we completed individually immaterial acquisitions for total consideration of $97,028,$493,354, net of cash acquired. The pro forma effects of these acquisitions on our operations were not material.

6. GOODWILL AND INTANGIBLE ASSETSGoodwill and Intangible Assets
Goodwill
The changes in the carrying amount of goodwill by reportable operating segment wereare as follows:
 August 31,
2019		 Additions/
Adjustments		 Foreign
Currency
Translation		 November 30,
2019
Communications, Media & Technology$992,743
 $19,381
 $4,577
 $1,016,701
Financial Services1,393,628
 (1,027) 8,736
 1,401,337
Health & Public Service1,005,428
 27,076
 3,014
 1,035,518
Products2,328,317
 19,355
 10,526
 2,358,198
Resources485,434
 381
 2,435
 488,250
Total$6,205,550
 $65,166
 $29,288
 $6,300,004

August 31,
2020		Additions/
Adjustments		Foreign
Currency
Translation		November 30,
2020
North America$4,604,441 $225,619 $647 $4,830,707 
Europe2,138,088 120,090 9,356 2,267,534 
Growth Markets967,291 48,909 12,970 1,029,170 
Total$7,709,820 $394,618 $22,973 $8,127,411 
Goodwill includes immaterial adjustments related to prior period acquisitions.
Intangible Assets
Our definite-lived intangible assets by major asset class wereare as follows:
  August 31, 2019 November 30, 2019
Intangible Asset Class Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount
Customer-related $1,013,976
 $(358,130) $655,846
 $1,053,237
 $(398,751) $654,486
Technology 119,686
 (45,851) 73,835
 111,510
 (42,838) 68,672
Patents 127,796
 (66,167) 61,629
 127,552
 (65,833) 61,719
Other 78,344
 (28,875) 49,469
 76,985
 (32,555) 44,430
Total $1,339,802
 $(499,023) $840,779
 $1,369,284
 $(539,977) $829,307

August 31, 2020November 30, 2020
Intangible Asset ClassGross Carrying AmountAccumulated AmortizationNet Carrying AmountGross Carrying AmountAccumulated AmortizationNet Carrying Amount
Customer-related$1,319,332 $(495,367)$823,965 $1,386,214 $(527,370)$858,844 
Technology150,765 (55,543)95,222 170,600 (56,977)113,623 
Patents129,295 (66,954)62,341 128,399 (65,928)62,471 
Other82,676 (34,986)47,690 82,622 (36,575)46,047 
Total$1,682,068 $(652,850)$1,029,218 $1,767,835 $(686,850)$1,080,985 
Total amortization related to our intangible assets was $53,372$67,207 and $40,093$53,372 for the three months ended November 30, 20192020 and 2018,2019, respectively. Estimated future amortization related to intangible assets held as of November 30, 20192020 is as follows:
Fiscal YearEstimated Amortization
Remainder of 2021$179,796 
2022198,541 
2023178,958 
2024158,361 
2025138,373 
Thereafter226,956 
Total$1,080,985 
Fiscal Year Estimated Amortization
Remainder of 2020 $145,127
2021 158,646
2022 137,918
2023 123,029
2024 98,037
Thereafter 166,550
Total $829,307


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ACCENTURE PLC

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (continued)
(In thousands of U.S. dollars, except share and per share amounts or as otherwise disclosed)
(Unaudited)


7. LEASES
We account for leases in accordance with Topic 842. See Note 1 (Basis of Presentation) to these Consolidated Financial Statements for further information on our adoption.
As a lessee, substantially all of our lease obligation is for office real estate. Our significant judgments used in determining our lease obligation include whether a contract is or contains a lease and the determination of the discount rate used to calculate the lease liability.
Our leases may include the option to extend or terminate before the end of the contractual term and are often non-cancelable or cancelable only by the payment of penalties. Our lease assets and liabilities include these options in the lease term when it is reasonably certain that they will be exercised. In certain cases, we sublease excess office real estate to third-party tenants.
Lease assets and liabilities recognized at the lease commencement date are determined predominantly as the present value of the payments due over the lease term. Unless the implicit rate can be determined, we use our incremental borrowing rate on that date to calculate the present value. Our incremental borrowing rate approximates the rate at which we could borrow, on a secured basis for a similar term, an amount equal to our lease payments in a similar economic environment.
Effective September 1, 2019, when we are the lessee, all leases are recognized as lease liabilities and associated lease assets on the Consolidated Balance Sheet. Lease liabilities represent our obligation to make payments arising from the lease. Lease assets represent our right to use an underlying asset for the lease term and may also include advance payments, initial direct costs or lease incentives. Fixed and variable payments that depend upon an index or rate, such as the Consumer Price Index (CPI), are included in the recognition of lease assets and liabilities at the commencement-date rate. Other variable payments, such as common area maintenance, property and other taxes, utilities and insurance that are based on the lessor’s cost, are recognized in the Consolidated Income Statement in the period incurred.
As of November 30, 2019, we had no material finance leases. Operating lease expense is recorded on a straight-line basis over the lease term. Lease costs were as follows:
 Three Months Ended November 30, 2019
Operating lease cost$181,082
Variable lease cost48,159
Sublease income(6,538)
Total net lease cost$222,703

Supplemental information related to operating lease transactions was as follows:
 Three Months Ended November 30, 2019
Lease liability payments$174,857
Lease assets obtained in exchange for liabilities$111,949

As of November 30, 2019, our operating leases had a weighted average remaining lease term of 7.4 years and a weighted average discount rate of 4.2%.

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ACCENTURE PLC

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (continued)
(In thousands of U.S. dollars, except share and per share amounts or as otherwise disclosed)
(Unaudited)


Notes To Consolidated Financial Statements
(In thousands of U.S. dollars, except share and per share amounts or as otherwise disclosed)
ACCENTURE FORM 10-Q
15
The following maturity analysis presents future undiscounted cash outflows for operating leases as of November 30, 2019:7. Shareholders’ Equity
 Lease Payments Sublease Receipts
2020 (Remainder)$545,128
 $(15,789)
2021668,309
 (15,975)
2022567,493
 (7,616)
2023463,033
 (7,493)
2024388,902
 (7,459)
Thereafter1,255,478
 (32,479)
Total lease payments (receipts)3,888,343
 $(86,811)
Less interest(525,905)  
Total lease liabilities$3,362,438
  

Dividends
As of November 30, 2019, we have entered into operating leases that have not yet commenced with future lease payments of $430 million that are not reflected in the table above. These leases are primarily related to office real estate and will commence in or before fiscal year 2022 with lease terms of up to 17 years.
Future minimum rental commitments under non-cancelable operating leases as of August 31, 2019, which were accounted for in accordance with Topic 840, were as follows:
 Lease Payments Sublease Receipts
2020$688,020
 $(24,884)
2021597,307
 (17,908)
2022516,544
 (8,535)
2023428,481
 (7,541)
2024363,107
 (7,184)
Thereafter1,246,097
 (30,708)
 $3,839,556
 $(96,760)


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ACCENTURE PLC

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (continued)
(In thousands of U.S. dollars, except share and per share amounts or as otherwise disclosed)
(Unaudited)


8. MATERIAL TRANSACTIONS AFFECTING SHAREHOLDERS’ EQUITY
Dividends
Our dividend activity during the three months ended November 30, 2019 was2020 is as follows:
  Dividend Per
Share		 Accenture plc Class A
Ordinary Shares		 Accenture Canada Holdings
Inc. Exchangeable Shares		 Total Cash
Outlay
Dividend Payment Date  Record Date Cash Outlay Record Date Cash Outlay 
November 15, 2019
 $0.80
 
October 17, 2019
 $507,725
 
October 15, 2019
 $656
 $508,381

 Dividend Per
Share		Accenture plc Class A
Ordinary Shares		Accenture Canada Holdings
Inc. Exchangeable Shares		Total Cash
Outlay
Dividend Payment DateRecord DateCash OutlayRecord DateCash Outlay
November 13, 2020$0.88 October 13, 2020$557,419 October 9, 2020$633 $558,052 
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.
Subsequent Event
On December 16, 2019,2020, the Board of Directors of Accenture plc declared a quarterly cash dividend of $0.80$0.88 per share on its Class A ordinary shares for shareholders of record at the close of business on January 16, 202014, 2021 payable on February 14, 2020.12, 2021. The payment of the cash dividend will result in the issuance of an immaterial number of additional restricted share units to holders of restricted share units.

9. FINANCIAL INSTRUMENTS
Derivatives
Notes To Consolidated Financial Statements
(In thousands of U.S. dollars, except share and per share amounts or as otherwise disclosed)
ACCENTURE FORM 10-Q
16
8. Financial Instruments
Derivatives
In the normal course of business, we use derivative financial instruments to manage foreign currency exchange rate risk. Our derivative financial instruments consist of deliverable and non-deliverable foreign currency forward contracts.
Cash Flow Hedges
For a cash flow hedge, the effective portion of the change in estimated fair value of a hedging instrument is recorded in Accumulated other comprehensive loss as a separate component of Shareholders’ Equity and is reclassified into Cost of services in the Consolidated Income Statements during the period in which the hedged transaction is recognized. For information related to derivatives designated as cash flow hedges that were reclassified into Cost of services during the three months ended November 30, 20192020 and 2018,2019, as well as those expected to be reclassified into Cost of services in the next 12 months, see Note 4 (Accumulated Other Comprehensive Loss) to these Consolidated Financial Statements.
Other Derivatives
Realized gains or losses and changes in the estimated fair value of foreign currency forward contracts that have not been designated as hedges were net gains of $28,324 and net losses of $56,619 and $48,983 for the three months ended November 30, 20192020 and 2018,2019, respectively. Gains and losses on these contracts are recorded in Other income (expense), net in the Consolidated Income Statements and are offset by gains and losses on the related hedged items.

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ACCENTURE PLC

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (continued)
(In thousands of U.S. dollars, except share and per share amounts or as otherwise disclosed)
(Unaudited)


Fair Value of Derivative Instruments
The notional and fair values of all derivative instruments wereare as follows:
 November 30,
2019		 August 31,
2019
Assets   
Cash Flow Hedges   
Other current assets$59,675
 $53,033
Other non-current assets50,686
 49,525
Other Derivatives   
Other current assets7,126
 8,059
Total assets$117,487
 $110,617
Liabilities   
Cash Flow Hedges   
Other accrued liabilities$9,952
 $18,826
Other non-current liabilities6,390
 8,770
Other Derivatives   
Other accrued liabilities14,292
 32,195
Total liabilities$30,634
 $59,791
Total fair value$86,853
 $50,826
Total notional value$8,953,147
 $8,709,917

November 30, 2020August 31, 2020
Assets
Cash Flow Hedges
Other current assets$79,405 $75,871 
Other non-current assets50,138 50,914 
Other Derivatives
Other current assets42,697 27,964 
Total assets$172,240 $154,749 
Liabilities
Cash Flow Hedges
Other accrued liabilities$12,883 $13,614 
Other non-current liabilities12,691 13,576 
Other Derivatives
Other accrued liabilities5,428 11,828 
Total liabilities$31,002 $39,018 
Total fair value$141,238 $115,731 
Total notional value$9,367,230 $9,600,691 
We utilize standard counterparty master agreements containing provisions for the netting of certain foreign currency transaction obligations and for the set-off of certain obligations in the event of an insolvency of one of the parties to the transaction. In the Consolidated Balance Sheets, we record derivative assets and liabilities at gross fair value. The potential effect of netting derivative assets against liabilities under the counterparty master agreements wasis as follows:
November 30, 2020August 31, 2020
Net derivative assets$159,030 $129,520 
Net derivative liabilities17,792 13,789 
Total fair value$141,238 $115,731 
 November 30,
2019		 August 31,
2019
Net derivative assets$98,125
 $88,811
Net derivative liabilities11,272
 37,985
Total fair value$86,853
 $50,826

Equity Securities Without Readily Determinable Fair Values
We hold investments in equity securities that do not have readily determinable fair values. We record these investments at cost and remeasure them to fair value based on certain observable price changes or impairment events as they occur. The carrying amount of these investments was $149,525 and $131,675 as of November 30, 2019 and August 31, 2019, respectively. 
10. INCOME TAXES
Notes To Consolidated Financial Statements
(In thousands of U.S. dollars, except share and per share amounts or as otherwise disclosed)
ACCENTURE FORM 10-Q
17
9. Income Taxes
We apply an estimated annual effective tax rate to our year-to-date operating results to determine the interim provision for income tax expense. In addition, we recognize taxes related to unusual or infrequent items or resulting from a change in judgment regarding a position taken in a prior year as discrete items in the interim period in which the event occurs.
Our effective tax rates for the three months ended November 30, 20192020 and 20182019 were 23.6%23.4% and 19.8%23.6%, respectively. TheAbsent the $119,700 and $60,492 gains on our investment in Duck Creek Technologies and related $22,906 and $10,183 in tax expense, our effective tax raterates for the three months ended November 30, 2019 was higher primarily due to lower benefits from final determinationsfirst quarter of prior year taxesfiscal 2021 and the phased-in effects of US tax reform.2020 would have been 23.7% and 23.9%, respectively.


18
10. Commitments and Contingencies
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ACCENTURE PLC

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (continued)
(In thousands of U.S. dollars, except share and per share amounts or as otherwise disclosed)
(Unaudited)


11. COMMITMENTS AND CONTINGENCIES
Indemnifications and Guarantees
In the normal course of business and in conjunction with certain client engagements, we have entered into contractual arrangements through which we may be obligated to indemnify clients with respect to certain matters.
As of November 30, 20192020 and August 31, 2019,2020, our aggregate potential liability to our clients for expressly limited guarantees involving the performance of third parties was approximately $730,000$848,000 and $794,000,$832,000, respectively, of which all but approximately $144,000$81,000 and $128,000,$87,000, respectively, may be recovered from the other third parties if we are obligated to make payments to the indemnified parties as a consequence of a performance default by the other third parties. For arrangements with unspecified limitations, we cannot reasonably estimate the aggregate maximum potential liability, as it is inherently difficult to predict the maximum potential amount of such payments, due to the conditional nature and unique facts of each particular arrangement.
To date, we have not been required to make any significant payment under any of the arrangements described above. We have assessed the current status of performance/payment risk related to arrangements with limited guarantees, warranty obligations, unspecified limitations and/or indemnification provisions and believe that any potential payments would be immaterial to the Consolidated Financial Statements, as a whole.
Legal Contingencies
As of November 30, 2019,2020, we or our present personnel had been named as a defendant in various litigation matters. We and/or our personnel also from time to time are involved in investigations by various regulatory or legal authorities concerning matters arising in the course of our business around the world. Based on the present status of these matters, including the putative class action lawsuit discussed below, management believes the range of reasonably possible losses in addition to amounts accrued, net of insurance recoveries, will not have a material effect on our results of operations or financial condition.
On July 24, 2019, Accenture was named in a putative class action lawsuit filed by consumers of Marriott International, Inc. (“Marriott”) in the U.S. District Court for the District of Maryland. The complaint alleges negligence by us, and seeks monetary damages, costs and attorneys’ fees and other related relief, relating to a data security incident involving unauthorized access to the reservations database of Starwood Worldwide Resorts, Inc. (“Starwood”), which was acquired by Marriott on September 23, 2016. Since 2009, we have provided certain IT infrastructure outsourcing services to Starwood. On October 27, 2020, the court issued an order largely denying Accenture’s motion to dismiss the claims against us. We continue to believe the lawsuit is without merit and we will vigorously defend it. We cannot reasonably estimateAt present, we do not believe any losses from this matter will have a rangematerial effect on our results of loss, if any, at this time.operations or financial condition.



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ACCENTURE PLC

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (continued)
(In thousands of U.S. dollars, except share and per share amounts or as otherwise disclosed)
(Unaudited)


Notes To Consolidated Financial Statements
(In thousands of U.S. dollars, except share and per share amounts or as otherwise disclosed)
ACCENTURE FORM 10-Q
18
12. SEGMENT REPORTING11. Segment Reporting
Our reportable operating segments are our 5 operating groups,three geographic markets, which are Communications, Media & Technology; Financial Services; Health & Public Service; Products;North America, Europe and Resources.Growth Markets. Information regarding our reportable operating segments, geographic regionsindustry groups and type of work is as follows:
Revenues
 Three Months Ended
 November 30, 2020November 30, 2019
GEOGRAPHIC MARKETS
North America$5,480,963 $5,287,812 
Europe3,967,408 3,789,657 
Growth Markets2,313,814 2,281,489 
Total Revenues$11,762,185 $11,358,958 
INDUSTRY GROUPS (1)
Communications, Media & Technology$2,333,645 $2,245,470 
Financial Services2,346,291 2,190,107 
Health & Public Service2,211,889 1,969,214 
Products3,206,125 3,220,015 
Resources1,664,235 1,734,152 
Total Revenues$11,762,185 $11,358,958 
TYPE OF WORK
Consulting$6,332,572 $6,377,251 
Outsourcing5,429,613 4,981,707 
Total Revenues$11,762,185 $11,358,958 
(1)Effective September 1, 2020, we revised the reporting of our industry groups to include amounts previously reported in Other. Prior period amounts have been reclassified to conform with the current period presentation.
Operating Income
 Three Months Ended
 November 30, 2020November 30, 2019
GEOGRAPHIC MARKETS
North America$888,809 $828,407 
Europe629,430 558,951 
Growth Markets372,430 379,905 
Total Operating Income$1,890,669 $1,767,263 
 Revenues
 Three Months Ended
 November 30, 2019 November 30, 2018
OPERATING GROUPS   
Communications, Media & Technology$2,245,448
 $2,134,576
Financial Services2,189,913
 2,120,162
Health & Public Service1,968,837
 1,754,490
Products3,216,705
 2,928,510
Resources1,733,533
 1,651,539
Other4,522
 16,269
TOTAL REVENUES$11,358,958
 $10,605,546
GEOGRAPHIC REGIONS (1)   
North America$5,287,812
 $4,856,302
Europe3,789,657
 3,713,832
Growth Markets2,281,489
 2,035,412
TOTAL REVENUES$11,358,958
 $10,605,546
TYPE OF WORK   
Consulting$6,377,251
 $5,967,372
Outsourcing4,981,707
 4,638,174
TOTAL REVENUES$11,358,958
 $10,605,546

_______________ 

(1)Effective September 1, 2019 we revised the reporting
ACCENTURE FORM 10-Q
Item 2. Management’s Discussion and Analysis of our geographic regions for the movementFinancial Condition and Results of one country from Growth Markets to Europe. Prior period amounts have been reclassified to conform with the current period presentation.Operations19
 Operating Income
 Three Months Ended
 November 30, 2019 November 30, 2018
OPERATING GROUPS   
Communications, Media & Technology$391,157
 $387,021
Financial Services316,232
 360,848
Health & Public Service251,992
 197,435
Products521,978
 437,585
Resources285,904
 246,123
TOTAL OPERATING INCOME$1,767,263
 $1,629,012




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ITEMItem 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSManagement’s 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, 2019,2020, and with the information under the heading “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended August 31, 2019.2020.
We use the terms “Accenture,” “we,” “our” and “us” in this report to refer to Accenture plc 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 2020”2021” means the 12-month period that will end on August 31, 2020.2021. All references to quarters, unless otherwise noted, refer to the quarters of our fiscal year.
We use the term “in local currency” so that certain financial results may be viewed without the impact of foreign currency exchange rate fluctuations, thereby facilitating period-to-period comparisons of business performance. Financial results “in local currency” are calculated by restating current period activity into U.S. dollars using the comparable prior year period’s foreign currency exchange rates. This approach is used for all results where the functional currency is not the U.S. dollar.
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,” “positioned,” “outlook” 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:to those identified below. For a discussion of risks and actions taken in response to the coronavirus (COVID-19) pandemic, see the “Overview” below and “Our results of operations have been significantly adversely affected and could in the future be materially adversely impacted by the COVID-19 pandemic.” under the heading “Risk Factors” in our Annual Report on Form 10-K for the year ended August 31, 2020. Many of the following risks, uncertainties and other factors identified below are, and will be, amplified by the COVID-19 pandemic.
•Our results of operations have been significantly adversely affected and could in the future be materially adversely impacted by the COVID-19 pandemic.
•Our results of operations have been, and may in the future be, adversely affected by volatile, negative or uncertain economic and political conditions and the effects of these conditions on our clients’ businesses and levels of business activity.
•Our business depends on generating and maintaining ongoing, profitable client demand for our services and solutions, including through the adaptation and expansion of our services and solutions in response to ongoing changes in technology and offerings, and a significant reduction in such demand or an inability to respond to the evolving technological environment could materially affect our results of operations.
•If we are unable to keep our supply of skills and resources in balance with client demand around the world and attract and retain professionals with strong leadership skills, our business, the utilization rate of our professionals and our results of operations may be materially adversely affected.
•We could face legal, reputational and financial risks if we fail to protect client and/or Accenture data from security incidents or cyberattacks.
•The markets in which we operate are highly competitive, and we might not be able to compete effectively.

•
•
Our business depends on generating and maintaining ongoing, profitable client demand for our services and solutions, including through the adaptation and expansion of our services and solutions in response to ongoing changes in technology and offerings, and a significant reduction in such demand or an inability to respond to the evolving technological environment could materially affect our results of operations.ACCENTURE FORM 10-Q
•Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
If we are unable to keep our supply of skills and resources in balance with client demand around the world and attract and retain professionals with strong leadership skills, our business, the utilization rate of our professionals and our results of operations may be materially adversely affected.
20
•
We could face legal, reputational and financial risks if we fail to protect client and/or Accenture data from security breaches or cyberattacks.
•
The markets in which we operate are highly competitive, and we might not be able to compete effectively.
•
Changes in our level of taxes, as well as audits, investigations and tax proceedings, or changes in tax laws or in their interpretation or enforcement, could have a material adverse effect on our effective tax rate, results of operations, cash flows and financial condition.
•
Our profitability could materially suffer if we are unable to obtain favorable pricing for our services and solutions, if we are unable to remain competitive, if our cost-management strategies are unsuccessful or if we experience delivery inefficiencies.
•
Our results of operations could be materially adversely affected by fluctuations in foreign currency exchange rates.

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•Our profitability could materially suffer if we are unable to obtain favorable pricing for our services and solutions, if we are unable to remain competitive, if our cost-management strategies are unsuccessful or if we experience delivery inefficiencies or fail to satisfy certain agreed-upon targets or specific service levels.
•Changes in our level of taxes, as well as audits, investigations and tax proceedings, or changes in tax laws or in their interpretation or enforcement, could have a material adverse effect on our effective tax rate, results of operations, cash flows and financial condition.
•Our ability to attract and retain business and employees may depend on our reputation in the marketplace.
•As a result of our geographically diverse operations and our growth strategy to continue to expand in our key markets around the world, we are more susceptible to certain risks.
•
Our business could be materially adversely affected if we incur legal liability.
•
Our work with government clients exposes us to additional risks inherent in the government contracting environment.
•
If we are unable to manage the organizational challenges associated with our size, we might be unable to achieve our business objectives.
•
Our ability to attract and retain business and employees may depend on our reputation in the marketplace.
•
If we do not successfully manage and develop our relationships with key alliance partners or if we fail to anticipate and establish new alliances in new technologies, our results of operations could be adversely affected.
•
We might not be successful at acquiring, investing in or integrating businesses, entering into joint ventures or divesting businesses.
•
If we are unable to protect or enforce our intellectual property rights, or if our services or solutions infringe upon the intellectual property rights of others or we lose our ability to utilize the intellectual property of others, our business could be adversely affected.
•
Our results of operations and share price could be adversely affected if we are unable to maintain effective internal controls.
•
Changes to accounting standards or in the estimates and assumptions we make in connection with the preparation of our consolidated financial statements could adversely affect our financial results.
•
Many of our contracts include fees subject to the attainment of targets or specific service levels. This could increase the variability of our revenues and impact our margins.
•
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.
•
We are incorporated in Ireland and a significant portion of our assets is 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. We may also be subject to criticism and negative publicity related to our incorporation in Ireland.
•
Irish law differs from the laws in effect in the United States and might afford less protection to shareholders.
•Our business could be materially adversely affected if we incur legal liability.
•Our work with government clients exposes us to additional risks inherent in the government contracting environment.
•Our results of operations could be materially adversely affected by fluctuations in foreign currency exchange rates.
•If we are unable to manage the organizational challenges associated with our size, we might be unable to achieve our business objectives.
•If we do not successfully manage and develop our relationships with key alliance partners or if we fail to anticipate and establish new alliances in new technologies, our results of operations could be adversely affected.
•We might not be successful at acquiring, investing in or integrating businesses, entering into joint ventures or divesting businesses.
•If we are unable to protect or enforce our intellectual property rights, or if our services or solutions infringe upon the intellectual property rights of others or we lose our ability to utilize the intellectual property of others, our business could be adversely affected.
•Our results of operations and share price could be adversely affected if we are unable to maintain effective internal controls.
•Changes to accounting standards or in the estimates and assumptions we make in connection with the preparation of our consolidated financial statements could adversely affect our financial results.
•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.
•We are incorporated in Ireland and Irish law differs from the laws in effect in the United States and might afford less protection to our shareholders. We may also be subject to criticism and negative publicity related to our incorporation in Ireland.
For a more detailed discussion of these factors, see the information under the heading “Risk Factors” in our Annual Report on Form 10-K for the year ended August 31, 2019.2020. Our forward-looking statements speak only as of the date of this report or as of the date they are made, and we undertake no obligation to update any forward-looking statements.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations21
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Overview
Overview
Revenues are driven by the abilityThe COVID-19 pandemic has caused a significant loss of life, disrupted businesses and restricted travel worldwide, causing significant economic disruption and uncertainty. This disruption and uncertainty has had and continues to have a significant adverse impact on our business, operations and financial results. The pandemic impacted almost all aspects of our executivesbusiness and forced us to secure new contracts,quickly adapt the way we operate. As described below, we took actions to renewshift the majority of our workforce to a remote working environment to ensure the continuity of our business, including the sales and extend existing contracts,delivery of services to our clients, and to deliver servicesrespond to a rapidly changing demand environment from our clients.
As a result of the COVID-19 pandemic, we enabled approximately 95% of our global workforce to work from home and solutions that add value relevantsuspended substantially all business travel. We continue to implement and evolve our comprehensive plan to return to our and our clients’ offices where permissible, with our people’s safety and the needs of our clients guiding how we manage our phased transition.
For the first quarter of fiscal 2021, our revenues increased 4% in U.S. dollars and 2% in local currency. While this represented slower growth compared to 9% growth in local currency in the first quarter of fiscal 2020, it was an improvement compared to flat revenue growth for the second half of fiscal 2020. We continued to experience reduced demand for our services during the quarter as some clients reprioritized and delayed certain work as a result of the pandemic, particularly in the Travel, Energy, High Tech, Retail and Industrial industries and primarily for our consulting services. We also experienced increased demand in the Public Service, Software & Platforms, Banking & Capital Markets and Life Sciences industries and from clients across all of our industry groups in connection with their digital transformations, the adoption of cloud technologies and security-related services. In this current needs and challenges. Themarket, the level of revenues we achieve is based on our ability to deliver market-leading services and solutions and to deploywhile deploying skilled teams of professionals quickly andeffectively.
For further information on a global basis.
Our results of operations are affected by economic conditions, including macroeconomic conditions and levels of business confidence. There continues to be significant volatility and economic and geopolitical uncertainty in many markets around the world, which may impact our business. We continue to monitor the impact of this volatility and uncertainty and seek to manage our costs in order to respond to changing conditions. There also continues to be volatility in foreign currency exchange rates. The majority of our revenues are denominated in currencies other than the U.S. dollar, including the Euro, Japanese yen and U.K. pound. Unfavorable fluctuations in foreign currency exchange rates have had and could have in the future a material effect on our financial results.
Summary of Results
Revenuesresults for the first quarter of fiscal 20202021, please see “Summary of Results” below. For a discussion of risks related to the COVID-19 pandemic, see “Our results of operations have been significantly adversely affected and could in the future be materially adversely impacted by the COVID-19 pandemic.” under the heading “Risk Factors” in our Annual Report on Form 10-K for the year ended August 31, 2020.
Summary of Results
Revenues for the first quarter of fiscal 2021 increased 7%4% in U.S. dollars and 9%2% in local currency compared to the first quarter of fiscal 2019. Demand for our services and solutions continued to be strong, resulting2020. This included the impact of a decline in growth across all areas of our business.reimbursable travel costs, which reduced revenues approximately 2%. During the first quarter of fiscal 2020,2021, revenue growth in local currency was very strongsolid in Health & Public ServiceNorth America and Products and strongmodest in Resources, Communications, Media & Technology and Financial Services.Growth Markets, partially offset by a slight decline in Europe. We experienced local currency revenue growth that was very strong in Growth MarketsHealth & Public Service, solid in Financial Services and strongmodest in North AmericaCommunications, Media & Technology, partially offset by a decline in Resources and Europe.a modest decline in Products. Revenue growth in local currency was strong in both outsourcing, andpartially offset by a slight decline in consulting during the first quarter of fiscal 2020. While the2021. The business environment remained competitive, we experiencedand the changes in demand have led to continued pricing improvement in some areas ofpressure, particularly for our business.consulting services. We use the term “pricing” to mean the contract profitability or margin on the work that we sell.
In our consulting business, revenues for the first quarter of fiscal 2020 increased 7%2021 decreased 1% in U.S. dollars and 9%2% in local currency compared to the first quarter of fiscal 20192020. This included the impact of a decline in reimbursable travel costs, which reduced consulting revenues approximately 3%. ConsultingThe decline in consulting revenue growth in local currency infor the first quarter of fiscal 20202021 was leddriven by very strongmodest declines in North America and Europe, partially offset by slight growth in Health & Public Service and Products and strong growth in Communications, Media & Technology and Resources, while Financial Services was flat.Growth Markets. Our consulting revenue growth continues to be driven by strong demand for digital-, cloud-helping our clients accelerate their digital transformation, including moving to the cloud, embedding security across the enterprise and security-related services and assisting clients with the adoption ofadopting new technologies. In addition, clients continue to be focused on initiatives designed to deliver cost savings and operational efficiency, as well as projects to integrate their global operationsaccelerate growth and grow and transform their businesses.improve customer experiences.
In our outsourcing business, revenues for the first quarter of fiscal 20202021 increased 7%9% in U.S. dollars and 9%8% in local currency compared to the first quarter of fiscal 2019.2020. Outsourcing revenue growth in local currency infor the first quarter of fiscal 20202021 was led by very strong growth in Financial Services and Resources andNorth America, strong growth in Health & Public Service, ProductsGrowth Markets and Communications, Media & Technology.modest growth in Europe. We continue to experience growing demand to assist clients with the operationapplication modernization and maintenance, of digital-related servicescloud enablement and cloud enablement.managed security services. In addition, clients continue to be focused on transforming their operations through data and analytics, automation and artificial intelligence to improve effectivenessdrive productivity and operational cost efficiency.savings.
As we are a global company, our revenues are denominated in multiple currencies and may be significantly affected by currency exchange rate fluctuations. The majority of our revenues are denominated in currencies other than the U.S. dollar, including the Euro, Japanese yen and U.K. pound. There continues to be volatility in foreign currency exchange rates. Unfavorable fluctuations in foreign currency exchange rates have had and could have in the future a material effect on our financial results. If the U.S. dollar weakens against other currencies, resulting in favorable currency translation, our revenues, revenue growth and results of operations in U.S. dollars may be higher. If the U.S. dollar strengthens against other currencies, resulting in unfavorable currency translation, our revenues, revenue growth and results of operations in U.S. dollars may be lower. The U.S. dollar strengthenedweakened against various currencies during the first quarter of fiscal 2021 compared to the first quarter of fiscal 2020,

ACCENTURE FORM 10-Q
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations22
compared to the
first quarter of fiscal 2019,
resulting in unfavorablefavorable currency translation and U.S. dollar revenue growth that was approximately 2% lowerhigher than our revenue growth in local currency. Assuming that exchange rates stay within recent ranges for the remainder of fiscal 2020,2021, we estimate that our full fiscal 20202021 revenue growth in U.S. dollars will be approximately 1% lower in U.S. dollars3% higher than our revenue growth in local currency.
The primary categories of operating expenses include 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, subcontractor and other personnel costs, and non-payroll costs on outsourcing contracts. Cost of services includes a variety of activities such as: contract delivery; recruiting and training; software development; and integration of acquisitions. Sales and marketing costs are driven primarily by: compensation costs for business development activities; marketing- and advertising-related activities; and certain acquisition-related costs. General and administrative costs primarily include costs for non-client-facing personnel, information systems, office space and certain acquisition-related costs.

23

Utilization for the first quarter of fiscal 20202021 was 91%93%, downup from 92%91% in the first quarter of fiscal 2019.2020. We hire to meet current and projected future demand. We proactively plan and manage the size and composition of our workforce and take actions as needed to address changes in the anticipated demand for our services and solutions, given that compensation costs are the most significant portion of our operating expenses. Based on current and projected future demand, we have increased ourOur headcount, the majority of which serve our clients, increased to approximately 514,000 as of November 30, 2020, compared to approximately 505,000 as of November 30, 2019, compared to approximately 469,000 as of November 30, 2018.2019. The year-over-year increase in our headcount reflects an overall increase in demand for our services and solutions, as well as headcount added in connection with acquisitions. Attrition, excluding involuntary terminations, for the first quarter of fiscal 20202021 was 14%9%, down from 15%14% in the first quarter of fiscal 2019.2020. We evaluate voluntary attrition, adjust levels of new hiring and use involuntary terminations as means to keep our supply of skills and resources in balance with changes in client demand. In addition, we adjust compensation in certain skill sets and geographies in order to attract and retain appropriate numbers of qualified employees. For the majority of our personnel, compensation increases become effective December 1st of each fiscal year. We strive to adjust pricing and/or the mix of resources to reduce the impact of compensation increases on our margin. Our ability to grow our revenues and maintain or increase our margin could be adversely affected if we are unable to: keep our supply of skills and resources in balance with changes in the types or amounts of services and solutions clients are demanding; recover increases in compensation; deploy our employees globally on a timely basis; manage attrition; and/or effectively assimilate and utilize new employees.
Gross margin (Revenues less Cost of services as a percentage of Revenues) for the first quarter of fiscal 20202021 was 32.1%33.1%, compared with 31.1%32.1% for the first quarter of fiscal 2019.2020. The increase in gross margin for the first quarter of fiscal 20202021 was primarily due to lower non-payroll costs, primarily for travel, partially offset by an increase in labor costs as a percentage of revenues compared to the same period in fiscal 2019.2020.
Sales and marketing and General and administrative costs as a percentage of revenues were 16.6%17.1% for the first quarter of fiscal 2020,2021, compared with 15.7%16.6% for the first quarter of fiscal 2019.2020. For the first quarter, of fiscal 2020 compared to the same period in fiscal 2019,2020, Sales and marketing costs as a percentage of revenues increased 40decreased 10 basis points primarily due to higher selling and other business development costs, and General and administrative costs as a percentage of revenues increased 50 basis points, primarily due to higher labor and technology and facilities costs. We continuously monitor these costs and implement cost-management actions, as appropriate.a percentage of revenues.
Operating margin (Operating income as a percentage of revenues) for the first quarter of fiscal 2021 was 16.1%, compared with 15.6% for the first quarter of fiscal 2020.
During the first quarter of fiscal 2021 and 2020, we recorded gains of $120 million and $60 million and related tax expense of $23 million and $10 million, respectively, related to our investment in Duck Creek Technologies. For additional information, see Note 1 (Basis of Presentation) to our Consolidated Financial Statements under Item 1, “Financial Statements.”
The effective tax rate for the first quarter of fiscal 2021 was 23.4%, compared with 23.6% for the first quarter of fiscal 2020. Absent the investment gains and related tax expense, our effective tax rates for the first quarter of fiscal 2021 and 2020 would have been 23.7% and 23.9%, respectively.
Diluted earnings per share were $2.32 for the first quarter of fiscal 2021, compared with $2.09 for the first quarter of fiscal 2020. The $97 million and $50 million gains on an investment, net of taxes, increased diluted earnings per share by $0.15 and $0.08 during the first quarter of fiscal 2021 and 2020, respectively. Excluding the impact of these gains, diluted earnings per share would have been $2.17 and $2.01 for the first quarter of fiscal 2021 and 2020, respectively.
We have presented our effective tax rate and diluted earnings per share excluding the impact of gains related to an investment for the first quarter of fiscal 2021 and 2020, as we believe doing so facilitates understanding as to the impact of these items and our performance in comparison to the prior period.
New Bookings
New bookings for the first quarter of fiscal 2021 were $12.9 billion, with consulting bookings of $6.6 billion and outsourcing bookings of $6.3 billion. New bookings for the first quarter of fiscal 2020 was 15.6%, compared with 15.4% for the first quarter of fiscal 2019.
New Bookings
New bookings for the first quarter of fiscal 2020 were $10.3 billion, with consulting bookings of $6.0 billion and outsourcing bookings of $4.3 billion.

24

ACCENTURE FORM 10-Q
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations23
Table of Contents


Results of Operations for the Three Months Ended November 30, 20192020 Compared to the Three Months Ended November 30, 20182019
Our five reportable operating segments are our operating groups, which are Communications, Media & Technology; Financial Services; Health & Public Service; Products; and Resources. Revenues (by operatingby geographic market, industry group geographic region and type of work) werework are as follows:
  Three Months EndedPercent
Increase
(Decrease)
U.S.
Dollars		Percent
Increase
(Decrease)
Local
Currency		Percent of Revenues
for the Three Months Ended
(in millions of U.S. dollars)November 30, 2020November 30, 2019November 30, 2020November 30, 2019
GEOGRAPHIC MARKETS
North America$5,481 $5,288 4 %4 %47 %47 %
Europe3,967 3,790 5 (1)34 33 
Growth Markets2,314 2,281 1 3 20 20 
Total$11,762 $11,359 4 %2 %100 %100 %
INDUSTRY GROUPS (1)
Communications, Media & Technology$2,334 $2,245 4 %3 20 %20 %
Financial Services2,346 2,190 7 5 20 19 
Health & Public Service2,212 1,969 12 11 19 17 
Products3,206 3,220 — (3)27 28 
Resources1,664 1,734 (4)(5)14 15 
Total$11,762 $11,359 4 %2 %100 %100 %
TYPE OF WORK
Consulting$6,333 $6,377 (1)%(2)%54 %56 %
Outsourcing5,430 4,982 9 8 46 44 
Total$11,762 $11,359 4 %2 %100 %100 %
  Three Months Ended Percent
Increase
U.S.
Dollars		 Percent
Increase
Local
Currency		 Percent of Revenues
for the Three Months Ended
  November 30, 2019 November 30,
2018		   November 30,
2019		 November 30,
2018
 (in millions of U.S. dollars)        
OPERATING GROUPS           
Communications, Media & Technology$2,245
 $2,135
 5% 7% 20% 20%
Financial Services2,190
 2,120
 3
 6
 19
 20
Health & Public Service1,969
 1,754
 12
 13
 18
 16
Products3,217
 2,929
 10
 12
 28
 28
Resources1,734
 1,652
 5
 7
 15
 16
Other5
 16
 n/m
 n/m
 —
 —
TOTAL REVENUES$11,359
 $10,606
 7% 9% 100% 100%
GEOGRAPHIC REGIONS (1)           
North America$5,288
 $4,856
 9% 9% 47% 46%
Europe3,790
 3,714
 2
 7
 33
 35
Growth Markets2,281
 2,035
 12
 13
 20
 19
TOTAL REVENUES$11,359
 $10,606
 7% 9% 100% 100%
TYPE OF WORK           
Consulting$6,377
 $5,967
 7% 9% 56% 56%
Outsourcing4,982
 4,638
 7
 9
 44
 44
TOTAL REVENUES$11,359
 $10,606
 7% 9% 100% 100%
_______________ 
n/m = not meaningful
Amounts in table may not total due to rounding.
(1)
(1)
Effective September 1, 2019 we revised the reporting of our geographic regions for the movement of one country from Growth Markets to Europe.Effective September 1, 2020, we revised the reporting of our industry groups to include amounts previously reported in Other. Prior period amounts have been reclassified to conform with the current period presentation.
Revenues
Revenues
Revenues were impacted by a reduction of approximately 2% from a decline in revenues from reimbursable travel costs in the first quarter of fiscal 2021 across all markets. The following revenues commentary discusses local currency revenue changes for the first quarter of fiscal 20202021 compared to the first quarter of fiscal 2019:2020:
Geographic Markets
Operating Groups•
Communications, Media & TechnologyNorth America revenues increased 7%4% in local currency, drivenled by growth in Public Service, Software & Platforms, across all geographic regions and Communications & Media in Europe, partially offset by a decline in High Tech in North America.
Financial Services revenues increased 6% in local currency, driven by growth in Insurance across all geographic regions and Banking & Capital Markets and Life Sciences. These increases were partially offset by declines in Consumer Goods, Retail & Travel Services, Energy, Chemicals & Natural Resources and High Tech. Revenue growth was driven by the United States.
•Europe revenues decreased 1% in local currency, led by declines in High Tech, Consumer Goods, Retail & Travel Services and Industrial. These decreases were partially offset by growth in Public Service, Software & Platforms and Health. The decline in revenues was driven by Spain and France, partially offset by growth in Italy and Switzerland.
•Growth Markets revenues increased 3% in local currency, led by growth in Banking & Capital Markets, Public Service, Utilities, High Tech and North America.Health. These increases were partially offset by a decline in Banking & Capital Markets in Europe.
Health & Public Service revenues increased 13% in local currency, led by Public Service and Health in North America.
Products revenues increased 12% in local currency, driven by growth in Consumer Goods, Retail & Travel Services and Life Sciences across all geographic regions, led by North America. These increases were partially offset by a decline in Industrial in North America.
Resources revenues increased 7% in local currency, driven byServices. Revenue growth in Energy and Utilities across all geographic regions and Chemicals & Natural Resources in Europe and Growth Markets. These increases were partially offset by a decline in Chemicals & Natural Resources in North America.

25

Geographic Regions
North America revenues increased 9% in local currency, driven by the United States.
Europe revenues increased 7% in local currency, led by Italy, Germany, France and Ireland.
Growth Markets revenues increased 13% in local currency,was driven by Japan, as well as Brazil and Singapore.Australia.
Operating Expenses
Operating expenses for the first quarter of fiscal 20202021 increased $615$280 million,, or 7%3%, over the first quarter of fiscal 2019,2020, and decreased as a percentage of revenues to 84.4%83.9% from 84.6%84.4% during this period.





ACCENTURE FORM 10-Q
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations24

Operating expenses by category are as follows:
Three Months Ended
(in millions of U.S. dollars)November 30, 2020November 30, 2019Increase
(Decrease)
Operating Expenses$9,872 83.9 %$9,592 84.4 %$280 
Cost of services7,864 66.9 7,711 67.9 153 
Sales and marketing1,227 10.4 1,191 10.5 36 
General and administrative costs780 6.6 689 6.1 91 
Amounts in table may not total due to rounding.
Cost of Services
Cost of services for the first quarter of fiscal 20202021 increased $403$153 million,, or 6%2%, over the first quarter of fiscal 2019,2020, and decreasedincreased as a percentage of revenues to 67.9%66.9% from 68.9%67.9% during this period. Gross margin for the first quarter of fiscal 20202021 increased to 32.1%33.1% from 31.1%32.1% during the first quarter of fiscal 2019.2020. The increase in gross margin was primarily due to lower non-payroll costs, primarily for travel, partially offset by an increase in labor costs as a percentage of revenues compared to the same period in fiscal 2019.2020.
Sales and Marketing
Sales and marketing expense for the first quarter of fiscal 20202021 increased $121$36 million,, or 11%3%, over the first quarter of fiscal 20192020, and decreased as a percentage of revenues to 10.4% from 10.5% during this period.
General and Administrative Costs
General and administrative costs for the first quarter of fiscal 2021 increased $91 million, or 13%, over the first quarter of fiscal 2020, and increased as a percentage of revenues to 10.5%6.6% from 10.1%6.1% during this period. The increase as a percentage of revenues was primarily due to higher sellinglabor and other business developmenttechnology costs as a percentage of revenues compared to the same period in fiscal 2019.2020.
General and Administrative Costs
General and administrative costs for the first quarter of fiscal 2020 increased $91 million, or 15%, over the first quarter of fiscal 2019, and increased as a percentage of revenues to 6.1% from 5.6% during this period. The increase as a percentage of revenues was primarily due to higher technology and facilities costs compared to the same period in fiscal 2019.
Operating Income and Operating Margin
Operating income for the first quarter of fiscal 20202021 increased $138$123 million,, or 8%7%, over the first quarter of fiscal 2019.2020.
Operating income and operating margin for each of the operating groups weregeographic markets are as follows:
Three Months Ended
  November 30, 2020November 30, 2019
(in millions of U.S. dollars)Operating
Income		Operating
Margin		Operating
Income		Operating
Margin		Increase
(Decrease)
North America$889 16 %$828 16 %$60 
Europe629 16 559 15 70 
Growth Markets372 16 380 17 (7)
Total$1,891 16.1 %$1,767 15.6 %$123 
 Three Months Ended  
  November 30, 2019 November 30, 2018  
  Operating
Income		 Operating
Margin		 Operating
Income		 Operating
Margin		 Increase
(Decrease)
  (in millions of U.S. dollars) 
Communications, Media & Technology$391
 17% $387
 18% $4
Financial Services316
 14
 361
 17
 (45)
Health & Public Service252
 13
 197
 11
 55
Products522
 16
 438
 15
 84
Resources286
 16
 246
 15
 40
TOTAL$1,767
 15.6% $1,629
 15.4% $138
Amounts in table may not total due to rounding.


26

We estimate that the aggregate percentage impact of foreign currency exchange rates on our operating income during the first quarter of fiscal 20202021 was similar to that disclosed for revenue.revenue for each geographic market. The reduction in travel costs during the first quarter of fiscal 2021 had a favorable impact on operating income. The commentary below provides insight into other factors affecting operating groupgeographic market performance and operating marginincome for the first quarter of fiscal 20202021 compared with the first quarter of fiscal 20192020:
•:
Communications, Media & TechnologyNorth America operating income was flat year-over-year asincreased primarily due to outsourcing revenue growth was partially offset by lowergrowth.
•Europe operating income increased primarily due to higher contract profitability and higher sales and marketing costs as a percentage of revenues.profitability.
Financial Services•Growth Markets operating income decreased as revenue growth was offset by lower contract profitability and higher sales and marketing costs as a percentage of revenues.
Health & Public Service operating income increased primarily due to revenue growth and higher consulting contract profitability.
Products operating income increased primarily due to revenue growth and higher consulting contract profitability.
Resources operating income increased primarily due to revenue growth and higher outsourcing contract profitability.
Other Income (Expense), net
Other income (expense), net primarily consists of foreign currency gains and losses, non-operating components of pension expense, as well as gains and losses associated with our investments. ForDuring the first quarter of fiscal 2021, other income (expense), net increased $82,928 over the first quarter of fiscal 2020,, other income (expense) increased $45 million over the first quarter of fiscal 2019, primarily due to higher gains on investments partially offset byand lower foreign exchange losses.
Income Tax Expense
The effective tax rate for the first quarter of fiscal 2020 was 23.6%, compared with 19.8% for the first quarter of fiscal 2019. The higher effective tax rate for the three months ended November 30, 2019 was primarily due to lower benefits from final determinations of prior year taxes and the phased-in effects of US tax reform. For additional information, see Note 1 (Basis of Presentation) to our Consolidated Financial Statements under Item 1, “Financial Statements.”

ACCENTURE FORM 10-Q
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations25

Income Tax Expense
The effective tax rate for the first quarter of fiscal 2021 was 23.4%, compared with 23.6% for the first quarter of fiscal 2020. Absent the $120 million and $60 million gains on an investment and related $23 million and $10 million in tax expense, our effective tax rates for the first quarter of fiscal 2021 and 2020 would have been 23.7% and 23.9%, respectively.
Our provision for income taxes is based on many factors and subject to volatility year to year. We expect the fiscal 20202021 annual effective tax rate to be in the range of 23.5%23.0% to 25.5%25.0%. The effective tax rate for interim periods can vary because of the timing of when certain events occur during the year.
Earnings Per Share
Diluted earnings per share were $2.09$2.32 for the first quarter of fiscal 2020,2021, compared with $1.96$2.09 for the first quarter of fiscal 2019.2020. The $0.13 increase in our$97 million and $50 million gains on an investment, net of taxes, increased diluted earnings per share was due to an increaseby $0.15 and $0.08 during the first quarter of $0.17 from higher revenuesfiscal 2021 and operating results, $0.06 from higher non-operating income,2020, respectively. Excluding the impact of these gains, diluted earnings per share would have been 2.17 and $0.01 from lower weighted average shares outstanding. These increases were partially offset by a decrease$2.01 for the first quarter of $0.11 from a higher effective tax rate.fiscal 2021 and 2020, respectively. For information regarding our earnings per share calculations, see Note 3 (Earnings Per Share) to our Consolidated Financial Statements under Item 1, “Financial Statements.”
The increase in diluted earnings per share is due to the following factors:
Earnings Per Share
Q1 FY20 As Reported$2.09
Higher revenue and operating results0.14 
Higher gains on an investment, net of tax0.07 
Lower share count0.01 
Lower effective tax rate0.01 
Q1 FY21 As Reported$2.32


27
ACCENTURE FORM 10-Q
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations26
Table of Contents


Liquidity and Capital Resources
As of November 30, 2019,2020, Cash and cash equivalents was $5.8$8.6 billion,, compared with $6.1$8.4 billion as of August 31, 2019.2020.
Cash flows from operating, investing and financing activities, as reflected in our Consolidated Cash Flows Statements, are summarized in the following table:
  Three Months Ended  
  November 30, 2019 November 30, 2018 Change
 (in millions of U.S. dollars)
Net cash provided by (used in):     
Operating activities$787
 $1,028
 $(241)
Investing activities(166) (273) 107
Financing activities(948) (1,462) 514
Effect of exchange rate changes on cash and cash equivalents11
 10
 1
Net increase (decrease) in cash and cash equivalents$(316) $(698) $381
_______________ 
  Three Months Ended
(in millions of U.S. dollars)November 30, 2020November 30, 2019Change
Net cash provided by (used in):
Operating activities$1,603 $787 $816 
Investing activities(446)(166)(281)
Financing activities(999)(948)(51)
Effect of exchange rate changes on cash and cash equivalents22 11 11 
Net increase (decrease) in cash and cash equivalents$179 $(316)$495 
Amounts in table may not total due to rounding.
Operating activities: The $241$816 million year-over-year decreaseincrease in operating cash flow was due to higher net income and changes in operating assets and liabilities, including a change in timing of certain compensation payments, partially offset by higher net income.liabilities.
Investing activities: The $107$281 million decreaseincrease in cash used was primarily due to lowerhigher spending on business acquisitions, and investments andpartially offset by increased proceeds from investments. For additional information, see Note 5 (Business Combinations) to our Consolidated Financial Statements under Item 1, “Financial Statements.”
Financing activities: The $514$51 million decreaseincrease in cash used was primarily due to a decreasean increase in cash dividends paid due to a changeas well as an increase in the frequencynet purchases of paymentsshares, partially offset by an increase in net proceeds from semi-annually to quarterly.share issuances. For additional information, see Note 8 (Material Transactions Affecting Shareholders’7 (Shareholders’ Equity) to our Consolidated Financial Statements under Item 1, “Financial Statements.”
We believe that our current and longer-term working capital, investments and other general corporate funding requirements will be satisfied for the next twelve months and thereafter through cash flows from operations and, to the extent necessary, from our borrowing facilities and future financial market activities.
Substantially all of our cash is held in jurisdictions where there are no regulatory restrictions or material tax effects on the free flow of funds. Domestic cash inflows for our Irish parent, principally dividend distributions from lower-tier subsidiaries, have been sufficient to meet our historic cash requirements, and we expect this to continue into the future.
Borrowing Facilities
As of November 30, 2019,2020, we had the following borrowing facilities, including the issuance of letters of credit, to support general working capital purposes:
(in millions of U.S. dollars)Facility
Amount		Borrowings
Under
Facilities
Syndicated loan facility$1,000 $— 
364-day syndicated loan facility1,000 — 
Separate, uncommitted, unsecured multicurrency revolving credit facilities1,060 — 
Local guaranteed and non-guaranteed lines of credit248 — 
Total$3,308$—
 Facility
Amount		 Borrowings
Under
Facilities
 (in millions of U.S. dollars)
Syndicated loan facility$1,000
 $—
Separate, uncommitted, unsecured multicurrency revolving credit facilities803
 —
Local guaranteed and non-guaranteed lines of credit217
 —
Total$2,020
 $—
Under the borrowing facilities described above, we had an aggregate of $414$515 million of letters of credit outstanding as of November 30, 2019.2020.


28
ACCENTURE FORM 10-Q
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations27


Share Purchases and Redemptions
The Board of Directors of Accenture plc has authorized funding for our publicly announced open-market share purchase program for acquiring Accenture plc Class A ordinary shares and for purchases and redemptions of Accenture plc Class A ordinary shares and Accenture Canada Holdings Inc. exchangeable shares held by current and former members of Accenture Leadership and their permitted transferees.
Our share purchase activity during the three months ended November 30, 2019 was2020 is as follows:
  Accenture plc Class A
Ordinary Shares		Accenture Canada
Holdings Inc. Exchangeable Shares
(in millions of U.S. dollars, except share amounts)SharesAmountSharesAmount
Open-market share purchases (1)2,865,941 $661 — $— 
Other share purchase programs— — 2,130 — 
Other purchases (2)475,289 108 — — 
Total3,341,230 $768 2,130 $— 
Amounts in table may not total due to rounding.
(1)We conduct a publicly announced open-market share purchase program for Accenture plc Class A ordinary shares. These shares are held as treasury shares by Accenture plc and may be utilized to provide for select employee benefits, such as equity awards to our employees.
  Accenture plc Class A
Ordinary Shares		 Accenture Canada
Holdings Inc. Exchangeable Shares
 Shares Amount Shares Amount
 (in millions of U.S. dollars, except share amounts)
Open-market share purchases (1)3,293,069
 $626
 —
 $—
Other share purchase programs—
 —
 23,715
 5
Other purchases (2)528,311
 99
 —
 —
Total3,821,380
 $725
 23,715
 $5
(2)During the three months ended November 30, 2020, as authorized under our various employee equity share plans, we acquired Accenture plc Class A ordinary shares primarily via share withholding for payroll tax obligations due from employees and former employees in connection with the delivery of Accenture plc Class A ordinary shares under those plans. These purchases of shares in connection with employee share plans do not affect our aggregate available authorization for our publicly announced open-market share purchase and the other share purchase programs.
_______________
(1)
We conduct a publicly announced open-market share purchase program for Accenture plc Class A ordinary shares. These shares are held as treasury shares by Accenture plc and may be utilized to provide for select employee benefits, such as equity awards to our employees.
(2)
During the three months ended November 30, 2019, as authorized under our various employee equity share plans, we acquired Accenture plc Class A ordinary shares primarily via share withholding for payroll tax obligations due from employees and former employees in connection with the delivery of Accenture plc Class A ordinary shares under those plans. These purchases of shares in connection with employee share plans do not affect our aggregate available authorization for our publicly announced open-market share purchase and the other share purchase programs.
We intend to continue to use a significant portion of cash generated from operations for share repurchases during the remainder of fiscal 2020.2021. The number of shares ultimately repurchased under our open-market share purchase program may vary depending on numerous factors, including, without limitation, share price and other market conditions, our ongoing capital allocation planning, the levels of cash and debt balances, other demands for cash, such as acquisition activity, general economic and/or business conditions, and board and management discretion. Additionally, as these factors may change over the course of the year, the amount of share repurchase activity during any particular period cannot be predicted and may fluctuate from time to time. Share repurchases may be made from time to time through open-market purchases, in respect of purchases and redemptions of Accenture Canada Holdings Inc. exchangeable shares, through the use of Rule 10b5-1 plans and/or by other means. The repurchase program may be accelerated, suspended, delayed or discontinued at any time, without notice.
Off-Balance Sheet Arrangements
In the normal course of business and in conjunction with some client engagements, we have entered into contractual arrangements through which we may be obligated to indemnify clients with respect to certain matters.
To date, we have not been required to make any significant payment under any of the arrangements described above. For further discussion of these transactions, see Note 1110 (Commitments and Contingencies) to our Consolidated Financial Statements under Item 1, “Financial Statements.”
Significant Accounting Policies
See Note 1 (Basis of Presentation) and Note 7 (Leases) to our Consolidated Financial Statements under Item 1, “Financial Statements.” Note 7 includes updates to our leases policy as a result of the implementation of FASB ASU No. 2016-02.

ACCENTURE FORM 10-Q
Item 3. Quantitative and Qualitative Disclosures About Market Risk28
ITEMItem 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISKQuantitative and Qualitative Disclosures About Market Risk
During the three months ended November 30, 2019,2020, there were no material changes to the information on market risk exposure disclosed in our Annual Report on Form 10-K for the year ended August 31, 2019.2020. For a discussion of our market risk associated with foreign currency risk, interest rate risk and equity price risk as of August 31, 2019,2020, 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, 2019.2020.


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ITEMItem 4. CONTROLS AND PROCEDURESControls and Procedures
Evaluation of Disclosure Controls and Procedures
Our management, with the participation of our principal executive officer and our principal financial officer, has evaluated 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. Any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives. Based on that evaluation, the principal executive officer and the principal financial officer of Accenture plc have concluded that, as of the end of the period covered by this report, our disclosure controls and procedures were effective at the reasonable assurance level.
Changes in Internal Control Over Financial Reporting
While we updated certain internal controls and supporting processes related to leases in connection with our adoption of FASB ASU No. 2016-02 (Topic 842), thereThere has been no change in our internal control over financial reporting that occurred during the first quarter of fiscal 20202021 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

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Table of Contents


ACCENTURE FORM 10-Q
Part II — Other Information29
PARTPart II — OTHER INFORMATIONOther Information
ITEMItem 1. LEGAL PROCEEDINGSLegal Proceedings
The information set forth under “Legal Contingencies” in Note 1110 (Commitments and Contingencies) to our Consolidated Financial Statements under Part I, Item 1, “Financial Statements,” is incorporated herein by reference.
ITEMItem 1A. RISK FACTORSRisk 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, 2019.2020 (the “Annual Report”). 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, 2019.Report.
ITEMItem 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDSUnregistered Sales of Equity Securities and Use of Proceeds
Purchases of Accenture plc Class A Ordinary Shares
The following table provides information relating to our purchases of Accenture plc Class A ordinary shares during the first quarter of fiscal 20202021.
PeriodTotal Number
of Shares
Purchased		Average
Price Paid
per Share (1)		Total Number of
Shares Purchased as
Part of Publicly
Announced Plans or
Programs (2)		Approximate Dollar Value
of Shares that May Yet Be
Purchased Under the Plans or Programs (3)
  (in millions of U.S. dollars)
September 1, 2020 — September 30, 2020880,210 $232.11 846,255 $6,119 
October 1, 2020 — October 31, 20201,567,525 225.71 1,247,554 5,838 
November 1, 2020 — November 30, 2020893,495 235.36 772,132 5,654 
Total (4)3,341,230 $229.97 2,865,941 
(1).Average price paid per share reflects the total cash outlay for the period, divided by the number of shares acquired, including those acquired by purchase or redemption for cash and any acquired by means of employee forfeiture.
(2)Since August 2001, the Board of Directors of Accenture plc has authorized and periodically confirmed a publicly announced open-market share purchase program for acquiring Accenture plc Class A ordinary shares. During the first quarter of fiscal 2021, we purchased 2,865,941 Accenture plc Class A ordinary shares under this program for an aggregate price of $661 million. The open-market purchase program does not have an expiration date.
(3)As of November 30, 2020, our aggregate available authorization for share purchases and redemptions was $5,654 million, which management has the discretion to use for either our publicly announced open-market share purchase program or the other share purchase programs. Since August 2001 and as of November 30, 2020, the Board of Directors of Accenture plc has authorized an aggregate of $40.1 billion for share purchases and redemptions by Accenture plc and Accenture Canada Holdings Inc.
(4)During the first quarter of fiscal 2021, Accenture purchased 475,289 Accenture plc Class A ordinary shares in transactions unrelated to publicly announced share plans or programs. These transactions consisted of acquisitions of Accenture plc Class A ordinary shares primarily via share withholding for payroll tax obligations due from employees and former employees in connection with the delivery of Accenture plc Class A ordinary shares under our various employee equity share plans. These purchases of shares in connection with employee share plans do not affect our aggregate available authorization for our publicly announced open-market share purchase and the other share purchase programs.
Period Total Number
of Shares
Purchased		 Average
Price Paid
per Share (1)		 Total Number of
Shares Purchased as
Part of Publicly
Announced Plans or
Programs (2)		 Approximate Dollar Value
of Shares that May Yet Be
Purchased Under the Plans or Programs (3)
  

     (in millions of U.S. dollars)
September 1, 2019 — September 30, 2019 913,483
 $194.10
 874,734
 $3,504
October 1, 2019 — October 31, 2019 1,829,298
 $185.69
 1,453,201
 $3,230
November 1, 2019 — November 30, 2019 1,078,599
 $192.49
 965,134
 $3,044
Total (4) 3,821,380
 $189.62
 3,293,069
  
_______________
(1)
Average price paid per share reflects the total cash outlay for the period, divided by the number of shares acquired, including those acquired by purchase or redemption for cash and any acquired by means of employee forfeiture.
(2)
Since August 2001, the Board of Directors of Accenture plc has authorized and periodically confirmed a publicly announced open-market share purchase program for acquiring Accenture plc Class A ordinary shares. During the first quarter of fiscal 2020, we purchased 3,293,069 Accenture plc Class A ordinary shares under this program for an aggregate price of $626 million. The open-market purchase program does not have an expiration date.
(3)
As of November 30, 2019, our aggregate available authorization for share purchases and redemptions was $3,044 million, which management has the discretion to use for either our publicly announced open-market share purchase program or the other share purchase programs. Since August 2001 and as of November 30, 2019, the Board of Directors of Accenture plc has authorized an aggregate of $35.1 billion for share purchases and redemptions by Accenture plc and Accenture Canada Holdings Inc.
(4)During the first quarter of fiscal 2020, Accenture purchased 528,311 Accenture plc Class A ordinary shares in transactions unrelated to publicly announced share plans or programs. These transactions consisted of acquisitions of Accenture plc Class A ordinary shares primarily via share withholding for payroll tax obligations due from employees and former employees in connection with the delivery of Accenture plc Class A ordinary shares under our various employee equity share plans. These purchases of shares in connection with employee share plans do not affect our aggregate available authorization for our publicly announced open-market share purchase and the other share purchase programs.

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Item 3. Defaults Upon Senior Securities
None.
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None.
ACCENTURE FORM 10-Q
Part II — Other Information30
ITEMItem 4. MINE SAFETY DISCLOSURESMine Safety Disclosures
Not applicable.
ITEMItem 5. OTHER INFORMATIONOther Information
(a) None.
(b) None.
ITEMItem 6. EXHIBITSExhibits
Exhibit Index:
Exhibit

Number
Exhibit
3.1
Amended and Restated Memorandum and Articles of Association of Accenture plc (incorporated by reference to Exhibit 3.1 to Accenture plc’s 8-K filed on February 7, 2018)
10.1*10.1+
Agreement2012 Employment Contract between Accenture (UK) LimitedSAS and Richard Lumb, dated as of June 26, 2019Jean-Marc Ollagnier, together with 2017 Addendum (filed herewith)
10.2
2015 Sub-plan for Restricted Share Units Granted in France (filed herewith)
10.2*10.3+
Form of Fiscal 2019 Key Executive Performance-Based Award Restricted Share Unit Agreement between Accenture plc and Alexander van ’t Noordende, dated as of September 21, 2019in France (filed herewith)
31.110.4
Form of Fiscal 2020 Key Executive Performance-Based Award Restricted Share Unit Agreement in France (filed herewith)
10.5
Form of Fiscal 2020 Accenture Leadership Performance Equity Award Restricted Share Unit Agreement in France (filed herewith)
10.6
Form of Next Generation Leadership Performance-Based Award Restricted Share Unit Agreement in France (filed herewith)
31.1
Certification of the Principal Executive Officer pursuant to Rule 13a-14(a) or 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (filed herewith)
31.2
Certification of the Principal Financial Officer pursuant to Rule 13a-14(a) or 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (filed herewith)
32.1
Certification of the Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (furnished herewith)
32.2
Certification of the Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (furnished herewith)
101The following financial information from Accenture plc’s Quarterly Report on Form 10-Q for the quarterly period ended November 30, 2019,2020, formatted in Inline XBRL: (i) Consolidated Balance Sheets as of November 30, 20192020 (Unaudited) and August 31, 2019,2020, (ii) Consolidated Income Statements (Unaudited) for the three months ended November 30, 20192020 and 2018,2019, (iii) Consolidated Statements of Comprehensive Income (Unaudited) for the three months ended November 30, 20192020 and 2018,2019, (iv) Consolidated Shareholders’ Equity Statement (Unaudited) for the three months ended November 30, 20192020 and 2018,2019, (v) Consolidated Cash Flows Statements (Unaudited) for the three months ended November 30, 20192020 and 20182019 and (vi) the Notes to Consolidated Financial Statements (Unaudited)
104The cover page from Accenture plc’s Quarterly Report on Form 10-Q for the quarterly period ended November 30, 2019,2020, formatted in Inline XBRL (included as Exhibit 101)

(*)     Indicates management contract or compensatory plan or arrangement.

Certain identified information has been excluded from these exhibits because it is both (i) not material and (ii) would be competitively harmful if publicly disclosed.
ACCENTURE FORM 10-Q
Signatures31


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SIGNATURESSignatures
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 19, 2019
17, 2020
ACCENTURE PLC
ACCENTURE PLC
By:
By:/s/ KC McClure
Name:  KC McClure
Title:Chief Financial Officer
(Principal Financial Officer and Authorized Signatory)


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