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 ~~February 28,~~May 31, 2023


☐			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

Accenture plc

(Exact name of registrant as specified in its charter)


Ireland			98-0627530
(State or other jurisdiction of incorporation or organization)			(I.R.S. Employer Identification No.)

1 Grand Canal Square,

Grand Canal Harbour,

Dublin 2, Ireland

(Address of principal executive offices)

(353) (1) 646-2000

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Class A ordinary shares, par value $0.0000225 per share	ACN	New 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. Yes ☑ 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). Yes ☑ 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 ☑

The number of shares of the registrant’s Class A ordinary shares, par value $0.0000225 per share, outstanding as of ~~March 9,~~June 8, 2023 was ~~662,595,677~~664,311,732 (which number includes ~~31,063,379~~33,516,386 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 ~~March 9,~~June 8, 2023 was ~~338,638.~~335,238.

Table of Contents



		Page
Part I.	Financial Information	3
Item 1.	Financial Statements	3
	Consolidated Balance Sheets as of F ~~ebruary~~ 28 ~~, 202~~3 May 31, 2023 (Unaudited) and August 31, 2022	3
	Consolidated Income Statements (Unaudited) for the three and ~~six~~ nine months ended ~~February~~ 28 ~~, 202~~3 May 31, 2023 and 20 2 22022	4
	Consolidated Statements of Comprehensive Income (Unaudited) for the three and ~~six~~ nine months ended ~~February~~ 28 ~~, 202~~3 May 31, 2023 and 20 2 22022	5
	Consolidated Shareholders’ Equity Statement (Unaudited) for the three a ~~nd six~~ and nine months ended ~~February~~ 2 8 ~~, 202~~3 May 31, 2023 and 20 2 22022	6
	Consolidated Cash Flows Statements (Unaudited) for the ~~six~~ nine months ended Fe ~~bruary~~28 ~~, 202~~3 May 31, 2023 and ~~202~~22022	10
	Notes to Consolidated Financial Statements (Unaudited)	11
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	21
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	37
Item 4.	Controls and Procedures	37
Part II.	Other Information	38
Item 1.	Legal Proceedings	38
Item 1A.	Risk Factors	38
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	38
Item 3.	Defaults Upon Senior Securities	38
Item 4.	Mine Safety Disclosures	39
Item 5.	Other Information	39
Item 6.	Exhibits	39
Signatures		40


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

Part I — Financial Information

Item 1. Financial Statements

Consolidated Balance Sheets

~~February 28,~~May 31, 2023 and August 31, 2022


		February 28, 2023		August 31, 2022			May 31, 2023		August 31, 2022
ASSETS	ASSETS	(Unaudited)				ASSETS	(Unaudited)
CURRENT ASSETS:	CURRENT ASSETS:					CURRENT ASSETS:
Cash and cash equivalents	Cash and cash equivalents	$	6,238,787	$	7,889,833	Cash and cash equivalents	$	8,535,446	$	7,889,833
Short-term investments	Short-term investments	4,189		3,973		Short-term investments	4,482		3,973
Receivables and contract assets	Receivables and contract assets	12,499,168		11,776,775		Receivables and contract assets	12,582,660		11,776,775
Other current assets	Other current assets	2,318,814		1,940,290		Other current assets	2,257,485		1,940,290
Total current assets	Total current assets	21,060,958		21,610,871		Total current assets	23,380,073		21,610,871
NON-CURRENT ASSETS:	NON-CURRENT ASSETS:					NON-CURRENT ASSETS:
Contract assets	Contract assets	75,423		46,844		Contract assets	66,432		46,844
Investments	Investments	325,251		317,972		Investments	176,259		317,972
Property and equipment, net	Property and equipment, net	1,560,691		1,659,140		Property and equipment, net	1,534,927		1,659,140
Lease assets	Lease assets	2,906,181		3,018,535		Lease assets	2,743,382		3,018,535
Goodwill	Goodwill	14,190,658		13,133,293		Goodwill	14,461,094		13,133,293
Deferred contract costs	Deferred contract costs	850,522		807,940		Deferred contract costs	852,188		807,940
Deferred tax assets	Deferred tax assets	4,050,145		4,001,200		Deferred tax assets	4,105,869		4,001,200
Other non-current assets	Other non-current assets	2,707,460		2,667,595		Other non-current assets	2,808,051		2,667,595
Total non-current assets	Total non-current assets	26,666,331		25,652,519		Total non-current assets	26,748,202		25,652,519
TOTAL ASSETS	TOTAL ASSETS	$	47,727,289	$	47,263,390	TOTAL ASSETS	$	50,128,275	$	47,263,390
LIABILITIES AND SHAREHOLDERS’ EQUITY	LIABILITIES AND SHAREHOLDERS’ EQUITY					LIABILITIES AND SHAREHOLDERS’ EQUITY
CURRENT LIABILITIES:	CURRENT LIABILITIES:					CURRENT LIABILITIES:
Current portion of long-term debt and bank borrowings	Current portion of long-term debt and bank borrowings	$	10,815	$	9,175	Current portion of long-term debt and bank borrowings	$	10,389	$	9,175
Accounts payable	Accounts payable	2,470,896		2,559,485		Accounts payable	2,388,474		2,559,485
Deferred revenues	Deferred revenues	5,112,570		4,478,048		Deferred revenues	5,101,692		4,478,048
Accrued payroll and related benefits	Accrued payroll and related benefits	5,974,677		7,611,794		Accrued payroll and related benefits	6,632,448		7,611,794
Income taxes payable	Income taxes payable	535,001		646,471		Income taxes payable	688,525		646,471
Lease liabilities	Lease liabilities	700,570		707,598		Lease liabilities	690,584		707,598
Other accrued liabilities	Other accrued liabilities	1,544,993		1,510,925		Other accrued liabilities	1,580,416		1,510,925
Total current liabilities	Total current liabilities	16,349,522		17,523,496		Total current liabilities	17,092,528		17,523,496
NON-CURRENT LIABILITIES:	NON-CURRENT LIABILITIES:					NON-CURRENT LIABILITIES:
Long-term debt	Long-term debt	45,155		45,893		Long-term debt	43,865		45,893
Deferred revenues	Deferred revenues	726,092		712,715		Deferred revenues	687,098		712,715
Retirement obligation	Retirement obligation	1,641,782		1,692,152		Retirement obligation	1,678,405		1,692,152
Deferred tax liabilities	Deferred tax liabilities	364,510		318,584		Deferred tax liabilities	402,984		318,584
Income taxes payable	Income taxes payable	1,250,019		1,198,139		Income taxes payable	1,270,733		1,198,139
Lease liabilities	Lease liabilities	2,451,961		2,563,090		Lease liabilities	2,351,375		2,563,090
Other non-current liabilities	Other non-current liabilities	440,970		462,233		Other non-current liabilities	539,358		462,233
Total non-current liabilities	Total non-current liabilities	6,920,489		6,992,806		Total non-current liabilities	6,973,818		6,992,806
COMMITMENTS AND CONTINGENCIES	COMMITMENTS AND CONTINGENCIES					COMMITMENTS AND CONTINGENCIES
SHAREHOLDERS’ EQUITY:	SHAREHOLDERS’ EQUITY:					SHAREHOLDERS’ EQUITY:
Ordinary shares, par value 1.00 euros per share, 40,000 shares authorized and issued as of February 28, 2023 and August 31, 2022		57		57
Class A ordinary shares, par value $0.0000225 per share, 20,000,000,000 shares authorized, 662,405,556 and 664,561,282 shares issued as of February 28, 2023 and August 31, 2022, respectively		15		15
Class X ordinary shares, par value $0.0000225 per share, 1,000,000,000 shares authorized, 338,638 and 500,837 shares issued and outstanding as of February 28, 2023 and August 31, 2022, respectively		—		—
Ordinary shares, par value 1.00 euros per share, 40,000 shares authorized and issued as of May 31, 2023 and August 31, 2022						Ordinary shares, par value 1.00 euros per share, 40,000 shares authorized and issued as of May 31, 2023 and August 31, 2022	57		57
Class A ordinary shares, par value $0.0000225 per share, 20,000,000,000 shares authorized, 664,125,473 and 664,561,282 shares issued as of May 31, 2023 and August 31, 2022, respectively						Class A ordinary shares, par value $0.0000225 per share, 20,000,000,000 shares authorized, 664,125,473 and 664,561,282 shares issued as of May 31, 2023 and August 31, 2022, respectively	15		15
Class X ordinary shares, par value $0.0000225 per share, 1,000,000,000 shares authorized, 335,238 and 500,837 shares issued and outstanding as of May 31, 2023 and August 31, 2022, respectively						Class X ordinary shares, par value $0.0000225 per share, 1,000,000,000 shares authorized, 335,238 and 500,837 shares issued and outstanding as of May 31, 2023 and August 31, 2022, respectively	—		—
Restricted share units	Restricted share units	1,636,155		2,091,382		Restricted share units	2,030,576		2,091,382
Additional paid-in capital	Additional paid-in capital	12,163,671		10,679,180		Additional paid-in capital	12,637,709		10,679,180
Treasury shares, at cost: Ordinary, 40,000 shares as of February 28, 2023 and August 31, 2022; Class A ordinary, 31,141,439 and 33,393,703 shares as of February 28, 2023 and August 31, 2022, respectively		(5,593,010)		(6,678,037)
Treasury shares, at cost: Ordinary, 40,000 shares as of May 31, 2023 and August 31, 2022; Class A ordinary, 33,323,829 and 33,393,703 shares as of May 31, 2023 and August 31, 2022, respectively						Treasury shares, at cost: Ordinary, 40,000 shares as of May 31, 2023 and August 31, 2022; Class A ordinary, 33,323,829 and 33,393,703 shares as of May 31, 2023 and August 31, 2022, respectively	(6,127,121)		(6,678,037)
Retained earnings	Retained earnings	17,500,001		18,203,842		Retained earnings	18,692,118		18,203,842
Accumulated other comprehensive loss	Accumulated other comprehensive loss	(1,944,270)		(2,190,342)		Accumulated other comprehensive loss	(1,900,923)		(2,190,342)
Total Accenture plc shareholders’ equity	Total Accenture plc shareholders’ equity	23,762,619		22,106,097		Total Accenture plc shareholders’ equity	25,332,431		22,106,097
Noncontrolling interests	Noncontrolling interests	694,659		640,991		Noncontrolling interests	729,498		640,991
Total shareholders’ equity	Total shareholders’ equity	24,457,278		22,747,088		Total shareholders’ equity	26,061,929		22,747,088
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	47,727,289	$	47,263,390	TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	50,128,275	$	47,263,390

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


Table of Contents	Consolidated Financial Statements (In thousands of U.S. dollars, except share and per share amounts)
ACCENTURE FORM 10-Q		4

Consolidated Income Statements

For the Three and ~~Six~~Nine Months Ended ~~February 28,~~May 31, 2023 and 2022

(Unaudited)


		Three Months Ended				Six Months Ended					Three Months Ended				Nine Months Ended
		February 28, 2023		February 28, 2022		February 28, 2023		February 28, 2022			May 31, 2023		May 31, 2022		May 31, 2023		May 31, 2022
REVENUES:	REVENUES:									REVENUES:
Revenues	Revenues	$	15,814,158	$	15,046,693	$	31,561,960	$	30,011,846	Revenues	$	16,564,585	$	16,158,803	$	48,126,545	$	46,170,649
OPERATING EXPENSES:	OPERATING EXPENSES:									OPERATING EXPENSES:
Cost of services	Cost of services	10,979,392		10,522,734		21,541,052		20,571,098		Cost of services	11,035,515		10,844,069		32,576,567		31,415,167
Sales and marketing	Sales and marketing	1,563,567		1,414,814		3,113,586		2,869,239		Sales and marketing	1,738,621		1,660,919		4,852,207		4,530,158
General and administrative costs	General and administrative costs	1,082,228		1,047,565		2,125,251		2,075,635		General and administrative costs	1,084,288		1,050,697		3,209,539		3,126,332
Business optimization costs	Business optimization costs	244,390		—		244,390		—		Business optimization costs	346,873		—		591,263		—
Total operating expenses	Total operating expenses	13,869,577		12,985,113		27,024,279		25,515,972		Total operating expenses	14,205,297		13,555,685		41,229,576		39,071,657
OPERATING INCOME	OPERATING INCOME	1,944,581		2,061,580		4,537,681		4,495,874		OPERATING INCOME	2,359,288		2,603,118		6,896,969		7,098,992
Interest income	Interest income	50,259		7,269		94,964		13,319		Interest income	81,818		8,727		176,782		22,046
Interest expense	Interest expense	(11,634)		(11,216)		(18,914)		(22,399)		Interest expense	(11,208)		(12,050)		(30,122)		(34,449)
Other income (expense), net	Other income (expense), net	(36,300)		(7,183)		(65,207)		(30,212)		Other income (expense), net	201,783		(8,877)		136,576		(39,089)

Loss on disposition of Russia business										Loss on disposition of Russia business	—		(96,294)		—		(96,294)
INCOME BEFORE INCOME TAXES	INCOME BEFORE INCOME TAXES	1,946,906		2,050,450		4,548,524		4,456,582		INCOME BEFORE INCOME TAXES	2,631,681		2,494,624		7,180,205		6,951,206
Income tax expense	Income tax expense	396,223		392,921		1,001,541		979,323		Income tax expense	583,346		675,308		1,584,887		1,654,631
NET INCOME	NET INCOME	1,550,683		1,657,529		3,546,983		3,477,259		NET INCOME	2,048,335		1,819,316		5,595,318		5,296,575
Net income attributable to noncontrolling interests in Accenture Canada Holdings Inc.	Net income attributable to noncontrolling interests in Accenture Canada Holdings Inc.	(1,604)		(1,742)		(3,689)		(3,676)		Net income attributable to noncontrolling interests in Accenture Canada Holdings Inc.	(2,101)		(1,902)		(5,790)		(5,578)
Net income attributable to noncontrolling interests – other	Net income attributable to noncontrolling interests – other	(25,431)		(20,845)		(54,696)		(47,617)		Net income attributable to noncontrolling interests – other	(36,238)		(31,339)		(90,934)		(78,956)
NET INCOME ATTRIBUTABLE TO ACCENTURE PLC	NET INCOME ATTRIBUTABLE TO ACCENTURE PLC	$	1,523,648	$	1,634,942	$	3,488,598	$	3,425,966	NET INCOME ATTRIBUTABLE TO ACCENTURE PLC	$	2,009,996	$	1,786,075	$	5,498,594	$	5,212,041
Weighted average Class A ordinary shares:	Weighted average Class A ordinary shares:									Weighted average Class A ordinary shares:
Basic	Basic	630,845,147		633,956,712		630,485,134		633,108,627		Basic	631,535,162		632,749,442		630,826,230		632,969,487
Diluted	Diluted	637,735,390		644,127,093		638,350,779		644,622,602		Diluted	638,743,434		641,004,741		638,404,751		643,692,440
Earnings per Class A ordinary share:	Earnings per Class A ordinary share:									Earnings per Class A ordinary share:
Basic	Basic	$	2.42	$	2.58	$	5.53	$	5.41	Basic	$	3.18	$	2.82	$	8.72	$	8.23
Diluted	Diluted	$	2.39	$	2.54	$	5.47	$	5.32	Diluted	$	3.15	$	2.79	$	8.62	$	8.11
Cash dividends per share	Cash dividends per share	$	1.12	$	0.97	$	2.24	$	1.94	Cash dividends per share	$	1.12	$	0.97	$	3.36	$	2.91

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


Table of Contents	Consolidated Financial Statements (In thousands of U.S. dollars)
ACCENTURE FORM 10-Q		5

Consolidated Statements of Comprehensive Income

For the Three and ~~Six~~Nine Months Ended ~~February 28,~~May 31, 2023 and 2022

(Unaudited)


		Three Months Ended				Six Months Ended					Three Months Ended				Nine Months Ended
		February 28, 2023		February 28, 2022		February 28, 2023		February 28, 2022			May 31, 2023		May 31, 2022		May 31, 2023		May 31, 2022
NET INCOME	NET INCOME	$	1,550,683	$	1,657,529	$	3,546,983	$	3,477,259	NET INCOME	$	2,048,335	$	1,819,316	$	5,595,318	$	5,296,575
OTHER COMPREHENSIVE INCOME (LOSS), NET OF TAX:	OTHER COMPREHENSIVE INCOME (LOSS), NET OF TAX:									OTHER COMPREHENSIVE INCOME (LOSS), NET OF TAX:
Foreign currency translation	Foreign currency translation	112,625		9,410		196,793		(211,353)		Foreign currency translation	13,252		(231,311)		210,045		(442,664)
Defined benefit plans	Defined benefit plans	6,539		9,534		98,219		(3,427)		Defined benefit plans	6,722		10,292		104,941		6,865
Cash flow hedges	Cash flow hedges	(7,762)		12,807		(48,940)		(41,208)		Cash flow hedges	23,373		(57,642)		(25,567)		(98,850)

OTHER COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO ACCENTURE PLC	OTHER COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO ACCENTURE PLC	111,402		31,751		246,072		(255,988)		OTHER COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO ACCENTURE PLC	43,347		(278,661)		289,419		(534,649)
Other comprehensive income (loss) attributable to noncontrolling interests	Other comprehensive income (loss) attributable to noncontrolling interests	2,469		96		5,338		(5,576)		Other comprehensive income (loss) attributable to noncontrolling interests	827		(4,456)		6,165		(10,032)
COMPREHENSIVE INCOME	COMPREHENSIVE INCOME	$	1,664,554	$	1,689,376	$	3,798,393	$	3,215,695	COMPREHENSIVE INCOME	$	2,092,509	$	1,536,199	$	5,890,902	$	4,751,894

COMPREHENSIVE INCOME ATTRIBUTABLE TO ACCENTURE PLC	COMPREHENSIVE INCOME ATTRIBUTABLE TO ACCENTURE PLC	$	1,635,050	$	1,666,693	$	3,734,670	$	3,169,978	COMPREHENSIVE INCOME ATTRIBUTABLE TO ACCENTURE PLC	$	2,053,343	$	1,507,414	$	5,788,013	$	4,677,392
Comprehensive income attributable to noncontrolling interests	Comprehensive income attributable to noncontrolling interests	29,504		22,683		63,723		45,717		Comprehensive income attributable to noncontrolling interests	39,166		28,785		102,889		74,502
COMPREHENSIVE INCOME	COMPREHENSIVE INCOME	$	1,664,554	$	1,689,376	$	3,798,393	$	3,215,695	COMPREHENSIVE INCOME	$	2,092,509	$	1,536,199	$	5,890,902	$	4,751,894

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


Table of Contents	Consolidated Financial Statements (In thousands of U.S. dollars and share amounts)
ACCENTURE FORM 10-Q		6

Consolidated Shareholders’ Equity Statement

For the Three Months Ended ~~February 28,~~May 31, 2023

(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				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													$							No. Shares								$			No. Shares			$			No. Shares					$				No. Shares
Balance as of November 30, 2022		$	57	40	$	15	658,255	$	—	499			$	2,167,437			$	11,051,309			$	(5,169,967)		(28,850)								$	16,981,432					$	(2,055,672)				$	22,974,611				$	691,339		$	23,665,950
Balance as of February 28, 2023																											Balance as of February 28, 2023	$	57				40				$	15				662,406					$	—		339			$	1,636,155		$	12,163,671		$	(5,593,010)	(31,181)			$		17,500,001			$	(1,944,270)		$	23,762,619		$	694,659		$	24,457,278
Net income	Net income																								1,523,648										1,523,648				27,035					1,550,683		Net income																																2,009,996					2,009,996		38,339		2,048,335
Other comprehensive income (loss)	Other comprehensive income (loss)																											111,402					111,402				2,469					113,871			Other comprehensive income (loss)																																			43,347		43,347		827		44,174
Purchases of Class A shares	Purchases of Class A shares														1,014				(1,117,535)				(4,085)												(1,116,521)				(1,014)					(1,117,535)		Purchases of Class A shares																							703			(787,299)			(2,815)								(786,596)		(703)		(787,299)

Share-based compensation expense	Share-based compensation expense										631,871				(1)																				631,870									631,870		Share-based compensation expense																			406,504				66,191														472,695				472,695
Purchases/redemptions of Accenture Canada Holdings Inc. exchangeable shares and Class X shares	Purchases/redemptions of Accenture Canada Holdings Inc. exchangeable shares and Class X shares									(160)					(676)																				(676)									(676)		Purchases/redemptions of Accenture Canada Holdings Inc. exchangeable shares and Class X shares																(4)							(1,638)														(1,638)				(1,638)
Issuances of Class A shares for employee share programs	Issuances of Class A shares for employee share programs						4,151				(1,193,792)				1,108,186				694,492				1,754		(267,284)										341,602				312					341,914		Issuances of Class A shares for employee share programs											1,719								(40,094)				406,315			253,188			632			(82,866)					536,543		473		537,016
Dividends	Dividends										30,639														(737,795)										(707,156)				(866)					(708,022)		Dividends																			28,011													(735,013)					(707,002)		(740)		(707,742)
Other, net	Other, net														3,839																				3,839				(24,616)					(20,777)		Other, net																							2,467														2,467		(3,357)		(890)
Balance as of February 28, 2023		$	57	40	$	15	662,406	$	—	339	$	1,636,155			$	12,163,671			$	(5,593,010)			(31,181)		$	17,500,001				$	(1,944,270)				$	23,762,619			$	694,659				$	24,457,278
Balance as of May 31, 2023																											Balance as of May 31, 2023	$	57				40				$	15				664,125					$	—		335			$	2,030,576		$	12,637,709		$	(6,127,121)	(33,364)			$	18,692,118			$	(1,900,923)		$	25,332,431		$	729,498		$	26,061,929

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


Table of Contents	Consolidated Financial Statements (In thousands of U.S. dollars and share amounts)
ACCENTURE FORM 10-Q		7

Consolidated Shareholders’ Equity Statement — (continued)

For the Three Months Ended ~~February 28,~~May 31, 2022

(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				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													$							No. Shares								$			No. Shares			$			No. Shares				$				No. Shares
Balance as of November 30, 2021		$	57	40	$	15	658,333	$	—	508			$	1,931,366			$	9,097,934			$	(4,079,625)		(26,287)								$	15,110,688					$	(1,707,236)				$	20,353,199				$	585,459		$	20,938,658
Balance as of February 28, 2022																											Balance as of February 28, 2022	$	57				40				$	15				662,417					$	—		504			$	1,438,596		$	10,065,790		$	(5,297,349)	(29,035)		$		16,028,399			$	(1,675,485)		$	20,560,023		$	596,956		$	21,156,979
Net income	Net income																								1,634,942										1,634,942				22,587					1,657,529		Net income																															1,786,075						1,786,075			33,241		1,819,316
Other comprehensive income (loss)	Other comprehensive income (loss)																											31,751					31,751				96					31,847			Other comprehensive income (loss)																																		(278,661)			(278,661)		(4,456)			(283,117)
Purchases of Class A shares	Purchases of Class A shares														1,639				(1,691,604)				(4,582)												(1,689,965)				(1,639)					(1,691,604)		Purchases of Class A shares																						925			(972,171)			(3,102)									(971,246)			(925)		(972,171)
Share-based compensation expense	Share-based compensation expense										546,607																								546,607									546,607		Share-based compensation expense																		346,666				60,591															407,257					407,257
Purchases/redemptions of Accenture Canada Holdings Inc. exchangeable shares and Class X shares	Purchases/redemptions of Accenture Canada Holdings Inc. exchangeable shares and Class X shares									(4)					(1,750)																				(1,750)									(1,750)		Purchases/redemptions of Accenture Canada Holdings Inc. exchangeable shares and Class X shares																																		—					—
Issuances of Class A shares for employee share programs	Issuances of Class A shares for employee share programs						4,084				(1,067,053)				959,264				473,880				1,834		(73,629)										292,462				285					292,747		Issuances of Class A shares for employee share programs											1,568							(55,313)				405,704			147,118			569									497,509			465		497,974
Dividends	Dividends										27,676														(643,602)										(615,926)				(657)					(616,583)		Dividends																		23,981													(637,116)						(613,135)			(650)		(613,785)
Other, net	Other, net														8,703																				8,703				(9,175)					(472)		Other, net																						1,272															1,272			(2,002)		(730)
Balance as of February 28, 2022		$	57	40	$	15	662,417	$	—	504	$	1,438,596			$	10,065,790			$	(5,297,349)			(29,035)		$	16,028,399				$	(1,675,485)				$	20,560,023			$	596,956				$	21,156,979
Balance as of May 31, 2022																											Balance as of May 31, 2022	$	57				40				$	15				663,985					$	—		504			$	1,753,930		$	10,534,282		$	(6,122,402)	(31,568)		$	17,177,358			$	(1,954,146)		$	21,389,094		$	622,629		$	22,011,723

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


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

Consolidated Shareholders’ Equity Statement — (continued)

For the ~~Six~~Nine Months Ended ~~February 28,~~May 31, 2023

(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				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													$							No. Shares								$			No. Shares				$			No. Shares					$				No. Shares
Balance as of August 31, 2022	Balance as of August 31, 2022	$	57	40	$	15	664,561	$	—	501			$	2,091,382			$	10,679,180			$	(6,678,037)		(33,434)								$	18,203,842					$	(2,190,342)				$	22,106,097				$	640,991		$	22,747,088	Balance as of August 31, 2022	$	57		40			$	15	664,561			$		—			501		$	2,091,382		$	10,679,180		$	(6,678,037)		(33,434)		$	18,203,842		$	(2,190,342)		$	22,106,097	$	640,991	$	22,747,088
Net income	Net income																								3,488,598										3,488,598				58,385					3,546,983		Net income																																5,498,594					5,498,594			96,724			5,595,318
Other comprehensive income (loss)	Other comprehensive income (loss)																											246,072					246,072				5,338					251,410			Other comprehensive income (loss)																																			289,419		289,419			6,165			295,584
Purchases of Class A shares	Purchases of Class A shares														2,318				(2,534,683)				(9,295)												(2,532,365)				(2,318)					(2,534,683)		Purchases of Class A shares																								3,021		(3,321,982)			(12,110)								(3,318,961)			(3,021)			(3,321,982)
Cancellation of treasury shares	Cancellation of treasury shares						(8,828)								(175,701)				2,595,281				8,828		(2,419,580)										—									—		Cancellation of treasury shares												(8,828)												(175,701)		2,595,281			8,828			(2,419,580)					—						—
Share-based compensation expense	Share-based compensation expense										1,001,365				55,974																				1,057,339									1,057,339		Share-based compensation expense																				1,407,869				122,165													1,530,034						1,530,034
Purchases/redemptions of Accenture Canada Holdings Inc. exchangeable shares and Class X shares	Purchases/redemptions of Accenture Canada Holdings Inc. exchangeable shares and Class X shares									(162)					(2,230)																				(2,230)									(2,230)		Purchases/redemptions of Accenture Canada Holdings Inc. exchangeable shares and Class X shares																	(166)							(3,868)													(3,868)						(3,868)
Issuances of Class A shares for employee share programs	Issuances of Class A shares for employee share programs						6,673				(1,512,994)				1,599,816				1,024,429				2,720		(304,363)										806,888				733					807,621		Issuances of Class A shares for employee share programs												8,392								(1,553,088)				2,006,131		1,277,617			3,352			(387,229)					1,343,431			1,206			1,344,637
Dividends	Dividends										56,402														(1,468,496)										(1,412,094)				(1,495)					(1,413,589)		Dividends																				84,413												(2,203,509)					(2,119,096)			(2,235)			(2,121,331)
Other, net	Other, net														4,314																				4,314				(6,975)					(2,661)		Other, net																								6,781													6,781			(10,332)			(3,551)
Balance as of February 28, 2023		$	57	40	$	15	662,406	$	—	339	$	1,636,155			$	12,163,671			$	(5,593,010)			(31,181)		$	17,500,001				$	(1,944,270)				$	23,762,619			$	694,659				$	24,457,278
Balance as of May 31, 2023																											Balance as of May 31, 2023	$	57				40				$	15				664,125					$	—		335				$	2,030,576		$	12,637,709		$	(6,127,121)	(33,364)			$	18,692,118			$	(1,900,923)	$	25,332,431		$	729,498		$	26,061,929

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


Table of Contents	Consolidated Financial Statements (In thousands of U.S. dollars and share amounts)
ACCENTURE FORM 10-Q		9

Consolidated Shareholders’ Equity Statement — (continued)

For the ~~Six~~Nine Months Ended ~~February 28,~~May 31, 2022

(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				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													$							No. Shares								$			No. Shares				$			No. Shares					$				No. Shares
Balance as of August 31, 2021	Balance as of August 31, 2021	$	57	40	$	15	656,591	$	—	513			$	1,750,784			$	8,617,838			$	(3,408,491)		(24,545)								$	13,988,748					$	(1,419,497)				$	19,529,454				$	567,660		$	20,097,114	Balance as of August 31, 2021	$	57		40			$	15	656,591			$		—			513		$	1,750,784		$	8,617,838		$	(3,408,491)		(24,545)		$	13,988,748		$	(1,419,497)		$	19,529,454	$	567,660	$	20,097,114
Net income	Net income																								3,425,966										3,425,966				51,293					3,477,259		Net income																																5,212,041					5,212,041			84,534			5,296,575
Other comprehensive income (loss)	Other comprehensive income (loss)																											(255,988)					(255,988)				(5,576)					(261,564)			Other comprehensive income (loss)																																			(534,649)		(534,649)			(10,032)			(544,681)
Purchases of Class A shares	Purchases of Class A shares														2,463				(2,534,446)				(7,017)												(2,531,983)				(2,463)					(2,534,446)		Purchases of Class A shares																								3,388		(3,506,617)			(10,119)								(3,503,229)			(3,388)			(3,506,617)
Share-based compensation expense	Share-based compensation expense										864,159				48,139																				912,298									912,298		Share-based compensation expense																				1,210,825				108,730													1,319,555						1,319,555
Purchases/redemptions of Accenture Canada Holdings Inc. exchangeable shares and Class X shares	Purchases/redemptions of Accenture Canada Holdings Inc. exchangeable shares and Class X shares									(9)					(4,274)																				(4,274)									(4,274)		Purchases/redemptions of Accenture Canada Holdings Inc. exchangeable shares and Class X shares																	(9)							(4,274)													(4,274)						(4,274)
Issuances of Class A shares for employee share programs	Issuances of Class A shares for employee share programs						5,826				(1,230,304)				1,389,803				645,588				2,527		(103,889)										701,198				679					701,877		Issuances of Class A shares for employee share programs												7,394								(1,285,617)				1,795,507		792,706			3,096			(103,889)					1,198,707			1,144			1,199,851
Dividends	Dividends										53,957														(1,282,426)										(1,228,469)				(1,322)					(1,229,791)		Dividends																				77,938												(1,919,542)					(1,841,604)			(1,972)			(1,843,576)
Other, net	Other, net														11,821																				11,821				(13,315)					(1,494)		Other, net																								13,093													13,093			(15,317)			(2,224)
Balance as of February 28, 2022		$	57	40	$	15	662,417	$	—	504	$	1,438,596			$	10,065,790			$	(5,297,349)			(29,035)		$	16,028,399				$	(1,675,485)				$	20,560,023			$	596,956				$	21,156,979
Balance as of May 31, 2022																											Balance as of May 31, 2022	$	57				40				$	15				663,985					$	—		504				$	1,753,930		$	10,534,282		$	(6,122,402)	(31,568)			$	17,177,358			$	(1,954,146)	$	21,389,094		$	622,629		$	22,011,723

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


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

Consolidated Cash Flows Statements

For the ~~Six~~Nine Months Ended ~~February 28,~~May 31, 2023 and 2022

(Unaudited)


		February 28, 2023		February 28, 2022			May 31, 2023		May 31, 2022
CASH FLOWS FROM OPERATING ACTIVITIES:	CASH FLOWS FROM OPERATING ACTIVITIES:					CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	Net income	$	3,546,983	$	3,477,259	Net income	$	5,595,318	$	5,296,575
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 —					Adjustments to reconcile Net income to Net cash provided by (used in) operating activities —
Depreciation, amortization and other	Depreciation, amortization and other	1,038,705		1,029,125		Depreciation, amortization and other	1,639,804		1,553,311
Share-based compensation expense	Share-based compensation expense	1,057,339		912,298		Share-based compensation expense	1,530,034		1,319,555

Deferred tax expense (benefit)	Deferred tax expense (benefit)	(92,295)		(15,670)		Deferred tax expense (benefit)	(136,237)		(27,784)
Other, net	Other, net	57,334		(110,458)		Other, net	(228,922)		(99,979)
Change in assets and liabilities, net of acquisitions —	Change in assets and liabilities, net of acquisitions —					Change in assets and liabilities, net of acquisitions —
Receivables and contract assets, current and non-current	Receivables and contract assets, current and non-current	(358,519)		(1,800,345)		Receivables and contract assets, current and non-current	(410,214)		(2,594,564)
Other current and non-current assets	Other current and non-current assets	(535,273)		(610,693)		Other current and non-current assets	(588,958)		(713,632)
Accounts payable	Accounts payable	(151,738)		(45,475)		Accounts payable	(242,633)		142,286
Deferred revenues, current and non-current	Deferred revenues, current and non-current	419,313		570,558		Deferred revenues, current and non-current	381,121		585,497
Accrued payroll and related benefits	Accrued payroll and related benefits	(1,713,468)		(541,474)		Accrued payroll and related benefits	(1,064,577)		489,743
Income taxes payable, current and non-current	Income taxes payable, current and non-current	(110,828)		255,397		Income taxes payable, current and non-current	57,745		360,262
Other current and non-current liabilities	Other current and non-current liabilities	(332,044)		(434,158)		Other current and non-current liabilities	(417,601)		(560,251)
Net cash provided by (used in) operating activities	Net cash provided by (used in) operating activities	2,825,509		2,686,364		Net cash provided by (used in) operating activities	6,114,880		5,751,019
CASH FLOWS FROM INVESTING ACTIVITIES:	CASH FLOWS FROM INVESTING ACTIVITIES:					CASH FLOWS FROM INVESTING ACTIVITIES:

Purchases of property and equipment	Purchases of property and equipment	(206,378)		(346,331)		Purchases of property and equipment	(347,878)		(540,947)
Purchases of businesses and investments, net of cash acquired	Purchases of businesses and investments, net of cash acquired	(1,076,987)		(1,848,774)		Purchases of businesses and investments, net of cash acquired	(1,334,007)		(2,212,388)
Proceeds from the sale of businesses and investments, net of cash transferred	Proceeds from the sale of businesses and investments, net of cash transferred	17,875		3,561		Proceeds from the sale of businesses and investments, net of cash transferred	418,113		(108,099)

Other investing, net	Other investing, net	5,119		6,461		Other investing, net	8,392		9,397
Net cash provided by (used in) investing activities	Net cash provided by (used in) investing activities	(1,260,371)		(2,185,083)		Net cash provided by (used in) investing activities	(1,255,380)		(2,852,037)
CASH FLOWS FROM FINANCING ACTIVITIES:	CASH FLOWS FROM FINANCING ACTIVITIES:					CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of shares	Proceeds from issuance of shares	807,621		701,877		Proceeds from issuance of shares	1,344,637		1,199,851
Purchases of shares	Purchases of shares	(2,536,913)		(2,538,720)		Purchases of shares	(3,325,850)		(3,510,891)
Proceeds from (repayments of) long-term debt, net	Proceeds from (repayments of) long-term debt, net	(408)		(8,877)		Proceeds from (repayments of) long-term debt, net	(364)		(11,530)
Cash dividends paid	Cash dividends paid	(1,413,589)		(1,229,791)		Cash dividends paid	(2,121,331)		(1,843,576)
Other financing, net	Other financing, net	(48,912)		(30,664)		Other financing, net	(62,117)		(43,468)
Net cash provided by (used in) financing activities	Net cash provided by (used in) financing activities	(3,192,201)		(3,106,175)		Net cash provided by (used in) financing activities	(4,165,025)		(4,209,614)
Effect of exchange rate changes on cash and cash equivalents	Effect of exchange rate changes on cash and cash equivalents	(23,983)		(97,164)		Effect of exchange rate changes on cash and cash equivalents	(48,862)		(153,974)
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS	NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS	(1,651,046)		(2,702,058)		NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS	645,613		(1,464,606)
CASH AND CASH EQUIVALENTS, beginning of period	CASH AND CASH EQUIVALENTS, beginning of period	7,889,833		8,168,174		CASH AND CASH EQUIVALENTS, beginning of period	7,889,833		8,168,174
CASH AND CASH EQUIVALENTS, end of period	CASH AND CASH EQUIVALENTS, end of period	$	6,238,787	$	5,466,116	CASH AND CASH EQUIVALENTS, end of period	$	8,535,446	$	6,703,568
SUPPLEMENTAL CASH FLOW INFORMATION:	SUPPLEMENTAL CASH FLOW INFORMATION:					SUPPLEMENTAL CASH FLOW INFORMATION:
Income taxes paid, net	Income taxes paid, net	$	1,318,515	$	874,413	Income taxes paid, net	$	1,774,337	$	1,264,631

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


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

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, 2022 included in our Annual Report on Form 10-K filed with the SEC on October 12, 2022.

The accompanying unaudited interim Consolidated Financial Statements have been prepared in accordance with U.S. GAAP, which requires management to make estimates and assumptions that affect amounts reported in the Consolidated Financial Statements and accompanying disclosures. Although these estimates are based on management’s best knowledge of current events and actions that we may undertake in the future, actual results may differ from those estimates. The Consolidated Financial Statements reflect all adjustments of a normal, recurring nature that are, in the opinion of management, necessary for a fair presentation of results for these interim periods. The results of operations for the three and ~~six~~nine months ended ~~February 28,~~May 31, 2023 are not necessarily indicative of the results that may be expected for the fiscal year ending August 31, 2023.

Allowance for Credit Losses—Client Receivables and Contract Assets

As of ~~February 28,~~May 31, 2023 and August 31, 2022, the total allowance for credit losses recorded for client receivables and contract assets was ~~$25,737~~$26,770 and $25,786, respectively. The change in the allowance is primarily due to immaterial write-offs and changes in gross client receivables and contract assets.

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:


		February 28, 2023		August 31, 2022			May 31, 2023		August 31, 2022
Equity method investments	Equity method investments	$	168,812	$	164,164	Equity method investments	$	22,816	$	164,164
Investments without readily determinable fair values	Investments without readily determinable fair values	156,439		153,808		Investments without readily determinable fair values	153,443		153,808
Total non-current investments	Total non-current investments	$	325,251	$	317,972	Total non-current investments	$	176,259	$	317,972

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~~

As of August 31, 2022, our equity method investments ~~consist~~consisted primarily of an investment in Duck Creek Technologies. As of February 28, 2023, the carrying amount of our investment was $143,700, and the estimated fair value of our approximately 16% ownership was $400,355. 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.

On ~~January 9,~~March 30, 2023, Duck Creek Technologies ~~announced an agreement to be~~was acquired by Vista Equity Partners for $19.00 per share. ~~The~~As part of this transaction, ~~is expected to close~~we received proceeds of $400,355 and recorded a gain of $252,920 in Other income (expense), net during the ~~first half~~third quarter of ~~calendar year 2023, subject to the satisfaction of customary closing conditions.~~fiscal 2023.


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

Depreciation and Amortization

As of ~~February 28,~~May 31, 2023 and August 31, 2022, total accumulated depreciation was ~~$2,694,138~~$2,766,344 and $2,490,187, respectively. See table below for a summary of depreciation on fixed assets, deferred transition amortization, intangible assets amortization and operating lease cost for the three and ~~six~~nine months ended ~~February 28,~~May 31, 2023 and 2022, respectively.


		Three Months Ended				Six Months Ended					Three Months Ended				Nine Months Ended
		February 28, 2023		February 28, 2022		February 28, 2023		February 28, 2022			May 31, 2023		May 31, 2022		May 31, 2023		May 31, 2022
Depreciation	Depreciation	$	137,742	$	149,872	$	281,791	$	288,665	Depreciation	$	165,053	$	150,272	$	446,844	$	438,937
Amortization - Deferred transition	Amortization - Deferred transition	85,160		68,331		155,600		135,537		Amortization - Deferred transition	91,480		68,420		247,080		203,957
Amortization - Intangible assets	Amortization - Intangible assets	120,212		115,831		229,281		218,373		Amortization - Intangible assets	101,814		109,855		331,095		328,228
Operating lease cost	Operating lease cost	184,226		192,869		364,728		383,111		Operating lease cost	240,601		193,209		605,329		576,320
Other	Other	5,136		1,357		7,305		3,439		Other	2,151		2,430		9,456		5,869
Total depreciation, amortization and other	Total depreciation, amortization and other	$	532,476	$	528,260	$	1,038,705	$	1,029,125	Total depreciation, amortization and other	$	601,099	$	524,186	$	1,639,804	$	1,553,311

Business Optimization

During the second quarter of fiscal 2023, we initiated actions to streamline our operations, transform our non-billable corporate functions and consolidate our office space to reduce costs. We recorded $346,873 and $591,263 of business optimization costs during the three and nine months ended May 31, 2023, respectively, primarily for employee severance. Total business optimization costs by reportable operating segment are as follows:


	Three Months Ended		Nine Months Ended
	May 31, 2023			May 31, 2023

North America	$	96,349		$	273,329
Europe	166,463			206,840
Growth Markets	84,061			111,094
Total business optimization costs	$	346,873		$	591,263

We continue to expect to record total business optimization costs of approximately $1.5 billion related to these actions, with approximately $800 million in fiscal 2023 and $700 million in fiscal 2024. This consists of approximately $1.2 billion of employee severance and other personnel costs and $300 million of ~~which we expect~~costs related to ~~incur $500 million in fiscal 2023 and~~ the ~~remaining $700 million in fiscal 2024.~~consolidation of office space. The actual amount and timing of severance and other personnel costs are dependent in part upon local country consultation processes and regulations and may differ from our current expectations and estimates. ~~Additionally, we expect to incur $300 million of costs related to the consolidation of office space, the majority of which is expected to be recorded in fiscal 2023.~~

~~We recorded $244,390 of business optimization costs during the second quarter of fiscal 2023, primarily for employee severance.~~

~~Total business optimization costs for the three and six months ended February 28, 2023 were $176,980 for North America, $40,377 for Europe and $27,033 for Growth Markets.~~


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

2. Revenues

Disaggregation of Revenue

See Note 11 (Segment Reporting) to these Consolidated Financial Statements for our disaggregated revenues.

Remaining Performance Obligations

We had remaining performance obligations of approximately ~~$27~~$26 billion and $24 billion as of ~~February 28,~~May 31, 2023 and August 31, 2022, 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 ~~52%~~37% of our remaining performance obligations as of ~~February 28,~~May 31, 2023 as revenue in fiscal 2023, an additional ~~24%~~35% in fiscal 2024, and the balance thereafter.

Contract Estimates

Adjustments in contract estimates related to performance obligations satisfied or partially satisfied in prior periods were immaterial for the three and ~~six~~nine months ended ~~February 28,~~May 31, 2023 and 2022.

Contract Balances

Deferred transition revenues were ~~$726,092~~$687,098 and $712,715 as of ~~February 28,~~May 31, 2023 and August 31, 2022, 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 ~~$850,522~~$852,188 and $807,940 as of ~~February 28,~~May 31, 2023 and August 31, 2022, 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.

The following table provides information about the balances of our Receivables and Contract assets, net of allowance, and Contract liabilities (Deferred revenues):


		As of February 28, 2023		As of August 31, 2022			As of May 31, 2023		As of August 31, 2022
Receivables	Receivables	$	10,997,530	$	10,484,211	Receivables	$	11,005,863	$	10,484,211
Contract assets (current)	Contract assets (current)	1,501,638		1,292,564		Contract assets (current)	1,576,797		1,292,564
Receivables and contract assets, net of allowance (current)	Receivables and contract assets, net of allowance (current)	12,499,168		11,776,775		Receivables and contract assets, net of allowance (current)	12,582,660		11,776,775
Contract assets (non-current)	Contract assets (non-current)	75,423		46,844		Contract assets (non-current)	66,432		46,844
Deferred revenues (current)	Deferred revenues (current)	5,112,570		4,478,048		Deferred revenues (current)	5,101,692		4,478,048
Deferred revenues (non-current)	Deferred revenues (non-current)	726,092		712,715		Deferred revenues (non-current)	687,098		712,715

Changes in the contract asset and liability balances during the ~~six~~nine months ended ~~February 28,~~May 31, 2023 were a result of normal business activity and not materially impacted by any other factors.

Revenues recognized during the three and ~~six~~nine months ended ~~February 28,~~May 31, 2023 that were included in Deferred revenues as of ~~November 30, 2022~~February 28, 2023 and August 31, 2022 were ~~$2.5~~$2.7 billion and ~~$3.3~~$3.7 billion, respectively. Revenues recognized during the three and ~~six~~nine months ended ~~February 28,~~May 31, 2022 that were included in Deferred revenues as of ~~November 30, 2021~~February 28, 2022 and August 31, 2021 were ~~$2.3~~$2.5 billion and ~~$3.2~~$3.5 billion, respectively.


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

3. Earnings Per Share

Basic and diluted earnings per share are calculated as follows:


		Three Months Ended				Six Months Ended					Three Months Ended				Nine Months Ended
		February 28, 2023		February 28, 2022		February 28, 2023		February 28, 2022			May 31, 2023		May 31, 2022		May 31, 2023		May 31, 2022
Basic earnings per share	Basic earnings per share									Basic earnings per share
Net income attributable to Accenture plc	Net income attributable to Accenture plc	$	1,523,648	$	1,634,942	$	3,488,598	$	3,425,966	Net income attributable to Accenture plc	$	2,009,996	$	1,786,075	$	5,498,594	$	5,212,041
Basic weighted average Class A ordinary shares	Basic weighted average Class A ordinary shares	630,845,147		633,956,712		630,485,134		633,108,627		Basic weighted average Class A ordinary shares	631,535,162		632,749,442		630,826,230		632,969,487
Basic earnings per share	Basic earnings per share	$	2.42	$	2.58	$	5.53	$	5.41	Basic earnings per share	$	3.18	$	2.82	$	8.72	$	8.23
Diluted earnings per share	Diluted earnings per share									Diluted earnings per share
Net income attributable to Accenture plc	Net income attributable to Accenture plc	$	1,523,648	$	1,634,942	$	3,488,598	$	3,425,966	Net income attributable to Accenture plc	$	2,009,996	$	1,786,075	$	5,498,594	$	5,212,041
Net income attributable to noncontrolling interests in Accenture Canada Holdings Inc. (1)	Net income attributable to noncontrolling interests in Accenture Canada Holdings Inc. (1)	1,604		1,742		3,689		3,676		Net income attributable to noncontrolling interests in Accenture Canada Holdings Inc. (1)	2,101		1,902		5,790		5,578
Net income for diluted earnings per share calculation	Net income for diluted earnings per share calculation	$	1,525,252	$	1,636,684	$	3,492,287	$	3,429,642	Net income for diluted earnings per share calculation	$	2,012,097	$	1,787,977	$	5,504,384	$	5,217,619
Basic weighted average Class A ordinary shares	Basic weighted average Class A ordinary shares	630,845,147		633,956,712		630,485,134		633,108,627		Basic weighted average Class A ordinary shares	631,535,162		632,749,442		630,826,230		632,969,487
Class A ordinary shares issuable upon redemption/exchange of noncontrolling interests (1)	Class A ordinary shares issuable upon redemption/exchange of noncontrolling interests (1)	664,218		675,417		666,479		679,187		Class A ordinary shares issuable upon redemption/exchange of noncontrolling interests (1)	660,083		673,775		664,324		677,363
Diluted effect of employee compensation related to Class A ordinary shares	Diluted effect of employee compensation related to Class A ordinary shares	5,865,118		9,013,734		6,861,930		10,377,945		Diluted effect of employee compensation related to Class A ordinary shares	6,505,805		7,513,927		6,830,076		9,834,622
Diluted effect of share purchase plans related to Class A ordinary shares	Diluted effect of share purchase plans related to Class A ordinary shares	360,907		481,230		337,236		456,843		Diluted effect of share purchase plans related to Class A ordinary shares	42,384		67,597		84,121		210,968
Diluted weighted average Class A ordinary shares	Diluted weighted average Class A ordinary shares	637,735,390		644,127,093		638,350,779		644,622,602		Diluted weighted average Class A ordinary shares	638,743,434		641,004,741		638,404,751		643,692,440
Diluted earnings per share	Diluted earnings per share	$	2.39	$	2.54	$	5.47	$	5.32	Diluted earnings per share	$	3.15	$	2.79	$	8.62	$	8.11

(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.


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

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				Six Months Ended					Three Months Ended				Nine Months Ended
		February 28, 2023		February 28, 2022		February 28, 2023		February 28, 2022			May 31, 2023		May 31, 2022		May 31, 2023		May 31, 2022
Foreign currency translation	Foreign currency translation									Foreign currency translation
Beginning balance	Beginning balance	$	(1,768,152)	$	(1,195,827)	$	(1,852,320)	$	(975,064)	Beginning balance	$	(1,655,527)	$	(1,186,417)	$	(1,852,320)	$	(975,064)
Foreign currency translation	Foreign currency translation	117,726		7,845		204,710		(219,248)		Foreign currency translation	12,897		(235,827)		217,607		(455,075)
Income tax benefit (expense)	Income tax benefit (expense)	(2,631)		1,637		(2,631)		2,367		Income tax benefit (expense)	1,152		110		(1,479)		2,477
Portion attributable to noncontrolling interests	Portion attributable to noncontrolling interests	(2,470)		(72)		(5,286)		5,528		Portion attributable to noncontrolling interests	(797)		4,406		(6,083)		9,934
Foreign currency translation, net of tax	Foreign currency translation, net of tax	112,625		9,410		196,793		(211,353)		Foreign currency translation, net of tax	13,252		(231,311)		210,045		(442,664)
Ending balance	Ending balance	(1,655,527)		(1,186,417)		(1,655,527)		(1,186,417)		Ending balance	(1,642,275)		(1,417,728)		(1,642,275)		(1,417,728)

Defined benefit plans	Defined benefit plans									Defined benefit plans
Beginning balance	Beginning balance	(257,091)		(572,919)		(348,771)		(559,958)		Beginning balance	(250,552)		(563,385)		(348,771)		(559,958)

Reclassifications into net periodic pension and post-retirement expense	Reclassifications into net periodic pension and post-retirement expense	8,719		12,850		134,890		(4,698)		Reclassifications into net periodic pension and post-retirement expense	8,712		12,579		143,602		7,881
Income tax benefit (expense)	Income tax benefit (expense)	(2,174)		(3,306)		(36,568)		1,267		Income tax benefit (expense)	(1,984)		(2,276)		(38,552)		(1,009)
Portion attributable to noncontrolling interests	Portion attributable to noncontrolling interests	(6)		(10)		(103)		4		Portion attributable to noncontrolling interests	(6)		(11)		(109)		(7)
Defined benefit plans, net of tax	Defined benefit plans, net of tax	6,539		9,534		98,219		(3,427)		Defined benefit plans, net of tax	6,722		10,292		104,941		6,865
Ending balance	Ending balance	(250,552)		(563,385)		(250,552)		(563,385)		Ending balance	(243,830)		(553,093)		(243,830)		(553,093)

Cash flow hedges	Cash flow hedges									Cash flow hedges
Beginning balance	Beginning balance	(30,429)		61,510		10,749		115,525		Beginning balance	(38,191)		74,317		10,749		115,525
Unrealized gain (loss)	Unrealized gain (loss)	(32,837)		39,162		(92,716)		6,054		Unrealized gain (loss)	25,722		(37,978)		(66,994)		(31,924)
Reclassification adjustments into Cost of services	Reclassification adjustments into Cost of services	18,000		(22,959)		20,606		(50,693)		Reclassification adjustments into Cost of services	4,115		(27,449)		24,721		(78,142)
Income tax benefit (expense)	Income tax benefit (expense)	7,068		(3,382)		23,119		3,387		Income tax benefit (expense)	(6,440)		7,724		16,679		11,111
Portion attributable to noncontrolling interests	Portion attributable to noncontrolling interests	7		(14)		51		44		Portion attributable to noncontrolling interests	(24)		61		27		105
Cash flow hedges, net of tax	Cash flow hedges, net of tax	(7,762)		12,807		(48,940)		(41,208)		Cash flow hedges, net of tax	23,373		(57,642)		(25,567)		(98,850)
Ending balance (1)	Ending balance (1)	(38,191)		74,317		(38,191)		74,317		Ending balance (1)	(14,818)		16,675		(14,818)		16,675

Accumulated other comprehensive loss	Accumulated other comprehensive loss	$	(1,944,270)	$	(1,675,485)	$	(1,944,270)	$	(1,675,485)	Accumulated other comprehensive loss	$	(1,900,923)	$	(1,954,146)	$	(1,900,923)	$	(1,954,146)

(1)As of ~~February 28,~~May 31, 2023, ~~$19,684~~$1,761 of net unrealized ~~losses~~gains related to derivatives designated as cash flow hedges is expected to be reclassified into Cost of services in the next twelve months.


Table of Contents	Notes To Consolidated Financial Statements (In thousands of U.S. dollars, except share and per share amounts or as otherwise disclosed)
ACCENTURE FORM 10-Q		16

5. Business Combinations

During the ~~six~~nine months ended ~~February 28,~~May 31, 2023, we completed individually immaterial acquisitions for total consideration of ~~$1,069,298,~~$1,315,925, net of cash acquired. The pro forma effects of these acquisitions on our operations were not material.

6. Goodwill and Intangible Assets

Goodwill

The changes in the carrying amount of goodwill by reportable operating segment are as follows:


		August 31, 2022		Additions/ Adjustments		Foreign Currency Translation		February 28, 2023			August 31, 2022		Additions/ Adjustments		Foreign Currency Translation		May 31, 2023
North America	North America	$	7,744,582	$	255,553	$	(15,138)	$	7,984,997	North America	$	7,744,582	$	293,229	$	(16,741)	$	8,021,070
Europe	Europe	4,134,091		274,694		197,005		4,605,790		Europe	4,134,091		452,915		269,623		4,856,629
Growth Markets	Growth Markets	1,254,620		357,274		(12,023)		1,599,871		Growth Markets	1,254,620		366,380		(37,605)		1,583,395
Total	Total	$	13,133,293	$	887,521	$	169,844	$	14,190,658	Total	$	13,133,293	$	1,112,524	$	215,277	$	14,461,094

Goodwill includes immaterial adjustments related to prior period acquisitions.

Intangible Assets

Our definite-lived intangible assets by major asset class are as follows:


		August 31, 2022						February 28, 2023							August 31, 2022						May 31, 2023
Intangible Asset Class	Intangible Asset Class	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount		Intangible Asset Class	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
Customer-related	Customer-related	$	2,498,001	$	(842,056)	$	1,655,945	$	2,690,751	$	(943,805)	$	1,746,946	Customer-related	$	2,498,001	$	(842,056)	$	1,655,945	$	2,667,461	$	(969,779)	$	1,697,682
Technology	Technology	283,251		(96,782)		186,469		286,434		(114,239)		172,195		Technology	283,251		(96,782)		186,469		287,727		(127,137)		160,590
Patents	Patents	126,950		(70,745)		56,205		127,244		(72,061)		55,183		Patents	126,950		(70,745)		56,205		124,293		(69,930)		54,363
Other	Other	62,875		(30,686)		32,189		68,680		(37,060)		31,620		Other	62,875		(30,686)		32,189		66,919		(40,471)		26,448
Total	Total	$	2,971,077	$	(1,040,269)	$	1,930,808	$	3,173,109	$	(1,167,165)	$	2,005,944	Total	$	2,971,077	$	(1,040,269)	$	1,930,808	$	3,146,400	$	(1,207,317)	$	1,939,083

Total amortization related to our intangible assets was ~~$120,212~~$101,814 and ~~$229,281~~$331,095 for the three and ~~six~~nine months ended ~~February 28,~~May 31, 2023, respectively. Total amortization related to our intangible assets was ~~$115,831~~$109,855 and ~~$218,373~~$328,228 for the three and ~~six~~nine months ended ~~February 28,~~May 31, 2022, respectively. Estimated future amortization related to intangible assets held as of ~~February 28,~~May 31, 2023 is as follows:


Fiscal Year	Fiscal Year	Estimated Amortization		Fiscal Year	Estimated Amortization
Remainder of 2023	Remainder of 2023	$	222,576	Remainder of 2023	$	107,772
2024	2024	386,493		2024	394,822
2025	2025	350,365		2025	361,876
2026	2026	301,701		2026	312,945
2027	2027	238,727		2027	250,085
Thereafter	Thereafter	506,082		Thereafter	511,583
Total	Total	$	2,005,944	Total	$	1,939,083


Table of Contents	Notes To Consolidated Financial Statements (In thousands of U.S. dollars, except share and per share amounts or as otherwise disclosed)
ACCENTURE FORM 10-Q		17

7. Shareholders’ Equity

Cancellation of Treasury Shares

During the ~~six~~nine months ended ~~February 28,~~May 31, 2023, we cancelled 8,828,496 Accenture plc Class A ordinary shares that were held as treasury shares and had an aggregate cost of $2,595,281. The effect of the cancellation of these treasury shares was recognized in Class A ordinary shares and Additional paid-in capital with the residual recorded in Retained earnings. There was no effect on total shareholders’ equity as a result of this cancellation.

Dividends

Our dividend activity during the ~~six~~nine months ended ~~February 28,~~May 31, 2023 is as follows:


		Dividend Per Share			Accenture plc Class A Ordinary Shares						Accenture Canada Holdings Inc. Exchangeable Shares						Total Cash Outlay						Dividend Per Share		Accenture plc Class A Ordinary Shares				Accenture Canada Holdings Inc. Exchangeable Shares				Total Cash Outlay
Dividend Payment Date	Dividend Payment Date		Record Date			Cash Outlay			Record Date			Cash Outlay			Dividend Payment Date					Record Date					Cash Outlay		Record Date		Cash Outlay
November 15, 2022	November 15, 2022		$	1.12		October 13, 2022			$	704,938		October 11, 2022			$	629					$	705,567		November 15, 2022	$	1.12	October 13, 2022		$	704,938	October 11, 2022		$	629	$	705,567
February 15, 2023	February 15, 2023	1.12			January 12, 2023		707,156				January 10, 2023		866				708,022		February 15, 2023				1.12		January 12, 2023		707,156		January 10, 2023		866		708,022

May 15, 2023																			May 15, 2023				1.12		April 13, 2023		707,002		April 11, 2023		740		707,742
Total Dividends	Total Dividends						$	1,412,094					$	1,495			$	1,413,589	Total Dividends								$	2,119,096			$	2,235	$	2,121,331

The payment of cash dividends includes the net effect of ~~$56,402~~$84,413 of additional restricted stock units being issued as a part of our share plans, which resulted in ~~195,372~~297,073 restricted share units being issued.

Subsequent Event

On ~~March 22,~~June 21, 2023, the Board of Directors of Accenture plc declared a quarterly cash dividend of $1.12 per share on our Class A ordinary shares for shareholders of record at the close of business on ~~April~~July 13, 2023 payable on ~~May~~August 15, 2023.


Table of Contents	Notes To Consolidated Financial Statements (In thousands of U.S. dollars, except share and per share amounts or as otherwise disclosed)
ACCENTURE FORM 10-Q		18

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 and ~~six~~nine months ended ~~February 28,~~May 31, 2023 and 2022, 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 $7,431 and net~~ losses of ~~$22,260~~$72,091 and $94,351 for the three and ~~six~~nine months ended ~~February 28,~~May 31, 2023, respectively, and net losses of ~~$13,048~~$31,285 and ~~$36,527~~$67,812 for the three and ~~six~~nine months ended ~~February 28,~~May 31, 2022, 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.

Fair Value of Derivative Instruments

The notional and fair values of all derivative instruments are as follows:


		February 28, 2023		August 31, 2022			May 31, 2023		August 31, 2022
Assets	Assets					Assets
Cash Flow Hedges	Cash Flow Hedges					Cash Flow Hedges
Other current assets	Other current assets	$	51,224	$	89,867	Other current assets	$	56,648	$	89,867
Other non-current assets	Other non-current assets	36,255		69,209		Other non-current assets	39,624		69,209
Other Derivatives	Other Derivatives					Other Derivatives
Other current assets	Other current assets	8,002		8,657		Other current assets	6,986		8,657
Total assets	Total assets	$	95,481	$	167,733	Total assets	$	103,258	$	167,733
Liabilities	Liabilities					Liabilities
Cash Flow Hedges	Cash Flow Hedges					Cash Flow Hedges
Other accrued liabilities	Other accrued liabilities	$	70,908	$	61,156	Other accrued liabilities	$	54,887	$	61,156
Other non-current liabilities	Other non-current liabilities	31,003		42,537		Other non-current liabilities	25,743		42,537
Other Derivatives	Other Derivatives					Other Derivatives
Other accrued liabilities	Other accrued liabilities	42,979		83,792		Other accrued liabilities	90,903		83,792
Total liabilities	Total liabilities	$	144,890	$	187,485	Total liabilities	$	171,533	$	187,485
Total fair value	Total fair value	$	(49,409)	$	(19,752)	Total fair value	$	(68,275)	$	(19,752)
Total notional value	Total notional value	$	11,874,339	$	11,095,604	Total notional value	$	13,373,535	$	11,095,604

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 is as follows:


		February 28, 2023		August 31, 2022			May 31, 2023		August 31, 2022
Net derivative assets	Net derivative assets	$	38,490	$	140,073	Net derivative assets	$	46,349	$	140,073
Net derivative liabilities	Net derivative liabilities	87,899		159,825		Net derivative liabilities	114,624		159,825
Total fair value	Total fair value	$	(49,409)	$	(19,752)	Total fair value	$	(68,275)	$	(19,752)


Table of Contents	Notes To Consolidated Financial Statements (In thousands of U.S. dollars, except share and per share amounts or as otherwise disclosed)
ACCENTURE FORM 10-Q		19

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 ~~February 28,~~May 31, 2023 and 2022 were ~~20.4%~~22.2% and ~~19.2%~~27.1%, respectively. The ~~higher~~lower effective tax rate for the three months ended ~~February 28,~~May 31, 2023 was primarily due to ~~lower tax benefits from share-based payments, partially offset by~~ lower tax expense from changes in the geographic distribution of ~~earnings.~~earnings, the tax impact from an investment gain and higher benefits from adjustments to prior year tax liabilities. Our effective tax rate for both the six months ended February 28, 2023 and 2022 was 22.0%. The business optimization costs of $244,390 and related reduction in tax expense of $51,515 did not significantly impact our effective tax rates for the ~~second quarter of fiscal 2023 or six~~nine months ended ~~February 28, 2023.~~May 31, 2023 and 2022 were 22.1% and 23.8%, respectively. The lower effective tax rate for the nine months ended May 31, 2023 was primarily due to lower tax expense from changes in the geographic distribution of earnings, higher benefits from adjustments to prior year tax liabilities and the tax impact from an investment gain, partially offset by lower tax benefits from share-based payments.

10. 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 ~~February 28,~~May 31, 2023 and August 31, 2022, our aggregate potential liability to our clients for expressly limited guarantees involving the performance of third parties was approximately ~~$1,638,000~~$1,750,000 and $1,349,000, respectively, of which all but approximately ~~$50,000~~$51,000 and $49,000, 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.

As of ~~February 28,~~May 31, 2023 and August 31, 2022, we have issued or provided guarantees in the form of letters of credit and surety bonds of ~~$1,143,983~~$1,239,648 and $1,116,298, respectively, the majority of which support certain contracts that require us to provide them as a guarantee of our performance. These guarantees are typically renewed annually and remain in place until the contractual obligations are satisfied. In general, we would only be liable for these guarantees in the event we defaulted in performing our obligations under each contract, the probability of which we believe is remote.

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, indemnification provisions, letters of credit and surety bonds, and believe that any potential payments would be immaterial to the Consolidated Financial Statements, as a whole.

Legal Contingencies

As of ~~February 28,~~May 31, 2023, 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, 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. On May 3, 2022, the court issued an order granting in part the plaintiffs’ motion for class certification, which we are appealing. Oral argument on the appeal was held on May 3, 2023. We continue to believe the lawsuit is without merit and we will vigorously defend it. At present, we do not believe any losses from this matter will have a material effect on our results of operations or financial condition.


Table of Contents	Notes To Consolidated Financial Statements (In thousands of U.S. dollars, except share and per share amounts or as otherwise disclosed)
ACCENTURE FORM 10-Q		20

11. Segment Reporting

Our reportable segments are our three geographic markets, which are North America, Europe and Growth Markets. Information regarding reportable segments, industry groups and type of work is as follows:


		Revenues									Revenues
		Three Months Ended				Six Months Ended					Three Months Ended				Nine Months Ended
		February 28, 2023		February 28, 2022		February 28, 2023		February 28, 2022			May 31, 2023		May 31, 2022		May 31, 2023		May 31, 2022
Geographic Markets	Geographic Markets									Geographic Markets
North America	North America	$	7,397,874	$	7,077,036	$	15,020,694	$	13,984,251	North America	$	7,720,903	$	7,613,629	$	22,741,597	$	21,597,880
Europe	Europe	5,300,169		5,009,885		10,372,219		10,109,953		Europe	5,615,466		5,350,360		15,987,685		15,460,313
Growth Markets	Growth Markets	3,116,115		2,959,772		6,169,047		5,917,642		Growth Markets	3,228,216		3,194,814		9,397,263		9,112,456
Total Revenues	Total Revenues	$	15,814,158	$	15,046,693	$	31,561,960	$	30,011,846	Total Revenues	$	16,564,585	$	16,158,803	$	48,126,545	$	46,170,649
Industry Groups (1)	Industry Groups (1)									Industry Groups (1)
Communications, Media & Technology	Communications, Media & Technology	$	2,884,802	$	2,998,970	$	5,865,005	$	5,896,265	Communications, Media & Technology	$	2,880,187	$	3,222,525	$	8,745,192	$	9,118,790
Financial Services	Financial Services	3,002,867		2,872,158		5,966,263		5,789,878		Financial Services	3,138,181		3,079,418		9,104,444		8,869,296
Health & Public Service	Health & Public Service	3,023,595		2,686,853		6,023,614		5,416,887		Health & Public Service	3,266,347		2,917,028		9,289,961		8,333,915
Products	Products	4,718,572		4,522,967		9,384,360		8,990,864		Products	4,968,399		4,806,180		14,352,759		13,797,044
Resources	Resources	2,184,322		1,965,745		4,322,718		3,917,952		Resources	2,311,471		2,133,652		6,634,189		6,051,604
Total Revenues	Total Revenues	$	15,814,158	$	15,046,693	$	31,561,960	$	30,011,846	Total Revenues	$	16,564,585	$	16,158,803	$	48,126,545	$	46,170,649
TYPE OF WORK
Type of Work										Type of Work
Consulting	Consulting	$	8,278,763	$	8,322,202	$	16,723,130	$	16,714,611	Consulting	$	8,693,030	$	9,032,484	$	25,416,160	$	25,747,095
Managed Services (2)	Managed Services (2)	7,535,395		6,724,491		14,838,830		13,297,235		Managed Services (2)	7,871,555		7,126,319		22,710,385		20,423,554
Total Revenues	Total Revenues	$	15,814,158	$	15,046,693	$	31,561,960	$	30,011,846	Total Revenues	$	16,564,585	$	16,158,803	$	48,126,545	$	46,170,649

(1)Effective June 1, 2022, we revised the reporting of our industry groups for the movement of Aerospace & Defense from Communications, Media & Technology to Products. Prior period amounts have been reclassified to conform with the current period presentation.

(2)Previously referred to as our outsourcing business.


		Operating Income									Operating Income
		Three Months Ended				Six Months Ended					Three Months Ended				Nine Months Ended
		February 28, 2023		February 28, 2022		February 28, 2023		February 28, 2022			May 31, 2023		May 31, 2022		May 31, 2023		May 31, 2022
Geographic Markets	Geographic Markets									Geographic Markets
North America	North America	$	823,858	$	1,090,910	$	2,133,741	$	2,335,327	North America	$	1,241,245	$	1,379,828	$	3,374,986	$	3,715,155
Europe	Europe	573,633		531,629		1,263,633		1,276,485		Europe	631,547		693,512		1,895,180		1,969,997
Growth Markets	Growth Markets	547,090		439,041		1,140,307		884,062		Growth Markets	486,496		529,778		1,626,803		1,413,840
Total Operating Income	Total Operating Income	$	1,944,581	$	2,061,580	$	4,537,681	$	4,495,874	Total Operating Income	$	2,359,288	$	2,603,118	$	6,896,969	$	7,098,992


Table of Contents
ACCENTURE FORM 10-Q	Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	21

Item 2. Management’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, 2022, 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, 2022.

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 2023” means the 12-month period that will end on August 31, 2023. 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,” “aspires,” “expects,” “intends,” “plans,” “projects,” “believes,” “estimates,” “positioned,” “outlook,” “goal,” “target,” 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 those identified below.

Business Risks

•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 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 match people and their skills 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 face legal, reputational and financial risks from any failure 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 ability to attract and retain business and employees may depend on our reputation in the marketplace.

•Our environmental, social and governance (ESG) commitments and disclosures may expose us to reputational risks and legal liability.

•If we do not successfully manage and develop our relationships with key ecosystem partners or if we fail to anticipate and establish new alliances in new technologies, our results of operations could be adversely affected.


Table of Contents
ACCENTURE FORM 10-Q	Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	22

Financial Risks

•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 results of operations could be materially adversely affected by fluctuations in foreign currency exchange rates.

•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.

Operational Risks

•As a result of our geographically diverse operations and strategy to continue to grow in key markets around the world, we are more susceptible to certain risks.

•If we are unable to manage the organizational challenges associated with our size, we might be unable to achieve our business objectives.

•We might not be successful at acquiring, investing in or integrating businesses, entering into joint ventures or divesting businesses.

Legal and Regulatory Risks

•Our business could be materially adversely affected if we incur legal liability.

•Our global operations expose us to numerous and sometimes conflicting legal and regulatory requirements, and violation of these regulations could harm our business.

•Our work with government clients exposes us to additional risks inherent in the government contracting environment.

•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.

•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, 2022. In addition, the timing and amount of costs related to our business optimization actions and the nature and extent of benefits realized from such actions are subject to uncertainties and other factors, including local country consultation processes and regulations, and may differ from our current expectations and estimates. 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.


Table of Contents
ACCENTURE FORM 10-Q	Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	23

Overview

Accenture is a leading global professional services company, providing a broad range of services and solutions across Strategy & Consulting, Technology, Operations, Industry X and Song. We serve clients in three geographic markets: North America, Europe and Growth Markets (Asia Pacific, Latin America, Africa and the Middle East). We combine our strength in technology with industry experience, functional expertise and global delivery capability to help the world’s leading businesses, governments and other organizations build their digital core, optimize their operations, accelerate revenue growth and enhance citizen services—creating tangible value at speed and scale.

Our results of operations are affected by economic conditions, including macroeconomic conditions, the overall inflationary environment and levels of business confidence. There continues to be significant economic and geopolitical uncertainty in many markets around the world, which has impacted and may continue to impact our ~~business, particularly with regard to wage inflation and volatility in foreign currency exchange rates. In some cases, these~~business. These conditions have slowed the pace and level of client ~~spending.~~spending for smaller contracts with a shorter duration, especially for our consulting services. From an industry perspective, we are also experiencing reduced demand particularly in our Communications, Media & Technology industry group.

Key Metrics

~~We saw strong demand across our business in the second quarter of fiscal 2023.~~ Key metrics for the ~~second~~third quarter of fiscal 2023 compared to the ~~second~~third quarter of fiscal 2022 are included below. We have presented operating margin and diluted earnings per share on a non-GAAP or “adjusted” basis to exclude the impact of ~~$244~~$347 million in business optimization costs and, with respect to diluted earnings per share, the impact of a $253 million investment gain recorded during the ~~second~~third quarter of fiscal 2023. For additional information, see Note 1 (Basis of Presentation) to our Consolidated Financial Statements under Item 1, “Financial Statements.”

•Revenues of ~~$15.8~~$16.6 billion, representing 5%3% growth in U.S. dollars and 9%5% growth in local currency;

•New bookings of ~~$22.1~~$17.2 billion, an increase of ~~13%~~2% in U.S. dollars and ~~17%~~4% in local currency;

•Operating margin of ~~12.3%~~14.2%, compared to ~~13.7%~~16.1% in the ~~second~~third quarter of fiscal 2022; adjusted operating margin expanded 1020 basis points to ~~13.8%~~16.3%;

•Diluted earnings per share of ~~$2.39,~~$3.15, compared to ~~$2.54~~$2.79 in the ~~second~~third quarter of fiscal 2022; adjusted earnings per share increased 6%14% to ~~$2.69;~~$3.19; and

•Cash returned to shareholders of ~~$1.8~~$1.5 billion, including share purchases of ~~$1.1 billion~~$789 million and dividends of $708 million.

Revenues


			Three Months Ended				Percent Increase (Decrease) U.S. Dollars				Percent Increase (Decrease) Local Currency						Three Months Ended								Percent Increase (Decrease) U.S. Dollars			Percent Increase (Decrease) Local Currency
(in billions of U.S. Dollars)	(in billions of U.S. Dollars)		February 28, 2023		February 28, 2022				(in billions of U.S. Dollars)				May 31, 2023		May 31, 2022

Geographic Markets	Geographic Markets	North America	$	7.4	$	7.1			5	%				5		%	Geographic Markets		North America			$	7.7	$	7.6		1		%		2	%
		Europe	5.3		5.0		6				12		Europe		5.6					5.4					5			7
		Growth Markets	3.1		3.0		5				14		Growth Markets		3.2					3.2					1			9
		Total Revenues	$	15.8	$	15.0	5	%			9	%	Total Revenues		$	16.6				$	16.2				3	%		5		%

Industry Groups (1)	Industry Groups (1)	Communications, Media & Technology	$	2.9	$	3.0	(4)	%			—	%	Industry Groups (1)	Communications, Media & Technology			$	2.9		$	3.2				(11)	%		(8)		%
		Financial Services	3.0		2.9		5				10			Financial Services			3.1			3.1					2			5
		Health & Public Service	3.0		2.7		13				15			Health & Public Service			3.3			2.9					12			14
		Products	4.7		4.5		4				9			Products			5.0			4.8					3			6
		Resources	2.2		2.0		11				16			Resources			2.3			2.1					8			12
		Total Revenues	$	15.8	$	15.0	5	%			9	%		Total Revenues			$	16.6		$	16.2				3	%		5		%

Type of Work	Type of Work	Consulting	$	8.3	$	8.3	(1)	%			4	%	Type of Work	Consulting			$	8.7		$	9.0				(4)	%		(1)		%
		Managed Services (2)	7.5		6.7		12				16			Managed Services (2)			7.9			7.1					10			13
		Total Revenues	$	15.8	$	15.0	5	%			9	%		Total Revenues			$	16.6		$	16.2				3	%		5		%

Amounts in table may not total due to rounding.

(2)Previously referred to as our outsourcing business.


Table of Contents
ACCENTURE FORM 10-Q	Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	24

Revenues for the ~~second~~third quarter of fiscal 2023 increased 5%3% in U.S. dollars and 9%5% in local currency compared to the ~~second~~third quarter of fiscal 2022. Revenues for the ~~six~~nine months ended ~~February 28,~~May 31, 2023 increased 5%4% in U.S. dollars and ~~12%~~10% in local currency compared to the ~~six~~nine months ended ~~February 28,~~May 31, 2022. During the ~~second~~third quarter of fiscal 2023, revenue growth in local currency was ~~very~~ strong in Growth Markets and Europe and ~~solid~~modest in North America. We experienced local currency revenue growth that was very strong in ~~Resources,~~ Health & Public Service and ~~Financial Services,~~Resources, strong in Products and ~~flat~~solid in Financial Services, partially offset by a decline in Communications, Media & Technology. Revenue growth in local currency was very strong in managed services, ~~and solid~~partially offset by a slight decline in consulting during the ~~second~~third quarter of fiscal 2023. In the ~~second~~third quarter of fiscal 2023, pricing, which we define as the contract profitability or margin on the work that we sell, was ~~relatively stable.~~lower in some areas of our business.

In our consulting business, revenues for the ~~second~~third quarter of fiscal 2023 decreased 4% in U.S. dollars and 1% in local currency compared to the third quarter of fiscal 2022. Consulting revenues for the nine months ended May 31, 2023 decreased 1% in U.S. dollars and increased 4% in local currency compared to the ~~second quarter of fiscal 2022. Consulting revenues for the six~~nine months ended ~~February 28, 2023 were flat~~May 31, 2022. The decline in ~~U.S. dollars and increased 7% in local currency compared to the six months ended February 28, 2022. Consulting~~consulting revenue ~~growth~~ in local currency for the ~~second~~third quarter of fiscal 2023 was ~~very strong~~driven by a modest decline in North America, partially offset by modest growth in Growth Markets, ~~solid in~~while Europe ~~and flat in North America.~~was flat. Our consulting revenue continues to be driven by helping our clients accelerate their digital transformation, including moving to the cloud, embedding security across the enterprise and adopting new technologies. In addition, clients continue to be focused on initiatives designed to deliver cost savings and operational efficiency, as well as projects to accelerate growth and improve customer experiences. While we continue to experience demand for these services, we are seeing a slower pace and level of client spending, especially for smaller contracts with a shorter duration.

In our managed services business, revenues for the ~~second~~third quarter of fiscal 2023 increased ~~12%~~10% in U.S. dollars and 13% in local currency compared to the third quarter of fiscal 2022. Managed services revenues for the nine months ended May 31, 2023 increased 11% in U.S. dollars and 16% in local currency compared to the ~~second quarter of fiscal 2022. Managed services revenues for the six~~nine months ended ~~February 28, 2023 increased 12% in U.S. dollars and 18% in local currency compared to the six months ended February 28,~~May 31, 2022. Managed services revenue in local currency for the ~~second~~third quarter of fiscal 2023 was driven by very strong growth in ~~Europe,~~ Growth Markets and Europe and strong growth in North America. We continue to experience growing demand to assist clients with application modernization and maintenance, cloud enablement and managed security services. In addition, clients continue to be focused on transforming their operations through data and analytics, automation and artificial intelligence to drive productivity and operational cost savings.

As we are a global company, our revenues are denominated in multiple currencies and may be significantly affected by currency exchange rate fluctuations. While a significant portion of our revenues are in U.S. dollars, the majority of our revenues are denominated in other currencies, 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 in the future have 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 strengthened against various currencies during the three and ~~six~~nine months ended ~~February 28,~~May 31, 2023 compared to the three and ~~six~~nine months ended ~~February 28,~~May 31, 2022, resulting in unfavorable currency translation and U.S. dollar revenue growth that was approximately 4%2.5% and 7%5.5% lower, respectively, than our revenue growth in local currency. Assuming that exchange rates stay within recent ranges for the remainder of fiscal 2023, we estimate that our full fiscal 2023 revenue growth in U.S. dollars will be approximately ~~4.5%~~4% lower than our revenue growth in local currency.

People Metrics

Utilization

Workforce

Annualized Voluntary Attrition

Utilization

Workforce

Annualized Voluntary Attrition

91%

738,000+

12%

91%

732,000

13%

compared to 92% in the second quarter of fiscal 2022

compared to approximately 699,000 as of February 28, 2022

compared to 18% in the second quarter of fiscal 2022

consistent with the third quarter of fiscal 2022

compared to approximately 710,000 as of May 31, 2022

compared to 20% in the third quarter of fiscal 2022

Utilization for the ~~second~~third quarter of fiscal 2023 was 91%, ~~compared to 92% in~~consistent with the ~~second~~third quarter of fiscal 2022. 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. Our workforce, the majority of which serves our clients, increased to approximately ~~738,000~~732,000 as of ~~February 28,~~May 31, 2023, compared to approximately ~~699,000~~710,000 as of ~~February 28,~~May 31, 2022. The year-over-year increase in our workforce reflects ~~demand for our services and solutions, as well as~~ people added in connection with ~~acquisitions.~~acquisitions and hiring for specific skills.

~~While we continue to hire, especially to support our strategic growth priorities, during~~For the ~~second~~third quarter of fiscal 2023, ~~we initiated actions to streamline our operations and transform our non-billable corporate functions to reduce costs. Over the next 18 months, these actions are expected to result~~annualized attrition, excluding involuntary terminations, was 13%, down from 20% in the ~~departure~~third quarter of ~~approximately 19,000 people (or 2.5%~~fiscal 2022. We evaluate voluntary attrition, adjust levels of new hiring and use involuntary terminations as a means to keep our ~~current workforce),~~supply of skills and ~~we expect over half of these departures will consist of people~~resources in ~~our non-billable corporate functions.~~balance with changes in client demand.


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ACCENTURE FORM 10-Q	Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	25

For the second quarter of fiscal 2023, attrition, excluding involuntary terminations, was 12%, down from 18% in the second quarter of fiscal 2022. We evaluate voluntary attrition, adjust levels of new hiring and use involuntary terminations as a means to keep our supply of skills and resources in balance with changes in client demand.

In addition, we adjust compensation in order to attract and retain appropriate numbers of qualified employees. For the majority of our people, compensation increases ~~become~~became effective December 1st of ~~each~~ fiscal ~~year.~~2023. Given the overall inflationary environment, compensation has ~~been and continues to increase~~increased faster than in prior years. We strive to adjust pricing as well as drive cost and delivery efficiencies, such as changing the mix of people and utilizing technology, to reduce the impact of compensation increases on our margin and contract profitability.

Our ability to grow our revenues and maintain or increase our margin could be adversely affected if we are unable to: match people and skills with the types or amounts of services and solutions clients are demanding; recover or offset increases in compensation; deploy our employees globally on a timely basis; manage attrition; and/or effectively assimilate new employees.

Operating Expenses

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 people serving our clients, which consists mainly of compensation, subcontractor and other payroll costs, and non-payroll costs on managed services 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 people that are non-client-facing, information systems, office space and certain acquisition-related costs.

Gross margin (Revenues less Cost of services as a percentage of Revenues) for the ~~second~~third quarter of fiscal 2023 was ~~30.6%~~33.4%, compared with ~~30.1%~~32.9% for the ~~second~~third quarter of fiscal 2022. Gross margin for the ~~six~~nine months ended ~~February 28,~~May 31, 2023 was ~~31.7%~~32.3% compared with ~~31.5%~~32.0% for the ~~six~~nine months ended ~~February 28,~~May 31, 2022. The increase in gross margin for the ~~second~~third quarter of fiscal 2023 and nine months ended May 31, 2023 was primarily due to lower labor costs, including lower subcontractor costs, partially offset by higher non-payroll costs, primarily for travel. ~~The increase in gross margin for the six months ended February 28, 2023 was primarily due to lower labor costs, including lower subcontractor costs.~~

Sales and marketing and General and administrative costs as a percentage of revenues were ~~16.7%~~17.0% for the ~~second~~third quarter of fiscal 2023 and ~~16.6%~~16.8% for the ~~six~~nine months ended ~~February 28,~~May 31, 2023, compared with ~~16.4%~~16.8% for the ~~second~~third quarter of fiscal 2022 and ~~16.5%~~16.6% for the ~~six~~nine months ended ~~February 28,~~May 31, 2022. For the ~~second~~third quarter of fiscal 2023 and ~~six~~nine months ended ~~February 28,~~May 31, 2023, compared to the same period in fiscal 2022, Sales and marketing costs increased 5020 and 30 basis points, ~~respectively. The increase in Sales and marketing for the second quarter of fiscal 2023 and six months ended February 28, 2023 was~~respectively, due to higher selling and other business development costs as a percentage of revenues. For the ~~second~~third quarter of fiscal 2023 and ~~six~~nine months ended ~~February 28,~~May 31, 2023, compared to the same period in fiscal 2022, General and administrative costs were flat and decreased 2010 basis points, respectively, as a percentage of revenues.

During the three and ~~six~~nine months ended ~~February 28,~~May 31, 2023, we recorded ~~$244~~$347 million and $591 million in business optimization costs, respectively, primarily for employee severance. As part of these business optimization initiatives, we expect to record total costs of approximately $1.5 billion, with approximately $800 million in fiscal 2023 and $700 million in fiscal 2024. The $1.5 billion is expected to consist of $1.2 billion of employee severance and other personnel costs and $300 million related to the consolidation of office space. The actual amount and timing of costs are dependent in part upon local country consultation processes and regulations and may differ from our current expectations and estimates. For additional information, see Note 1 (Basis of Presentation) to our Consolidated Financial Statements under Item 1, “Financial Statements.”

Operating margin (Operating income as a percentage of Revenues) for the ~~second~~third quarter of fiscal 2023 was ~~12.3%~~14.2%, compared with ~~13.7%~~16.1% for the ~~second~~third quarter of fiscal 2022. Operating margin for the ~~six~~nine months ended ~~February 28,~~May 31, 2023 was ~~14.4%~~14.3%, compared with ~~15.0%~~15.4% for the ~~six~~nine months ended ~~February 28,~~May 31, 2022. The business optimization costs recorded induring the ~~second quarter of fiscal~~three and nine months ended May 31, 2023 ~~decreased~~reduced operating margin by ~~150~~210 and 80130 basis points, ~~for the second quarter of fiscal 2023 and six months ended February 28, 2023,~~ respectively. Excluding these costs, operating margin for both the ~~second quarter of fiscal 2023~~three and ~~six~~nine months ended ~~February 28,~~May 31, 2023 increased ~~10 and~~ 20 basis points to ~~13.8%~~16.3% and ~~15.2%~~15.6%, respectively.

Other Income (Expense), net

During the three and nine months ended May 31, 2023, we recorded a gain of $253 million 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.”

Effective Tax Rate

The effective tax rates for the ~~second~~third quarter of fiscal 2023 and 2022 were ~~20.4%~~22.2% and ~~19.2%~~27.1%, respectively. The effective tax ~~rate~~rates for ~~both~~ the ~~six~~nine months ended ~~February 28,~~May 31, 2023 and 2022 ~~was 22.0%. The~~were 22.1% and 23.8%, respectively. Absent the business optimization costs of ~~$244~~$347 million and $591 million and related reduction in tax expense of ~~$52~~$80 million ~~did not significantly impact~~and $132 million, as well as an investment gain of $253 million and related tax expense of $9 million, our effective tax rates for the ~~second~~three and nine months ended May 31, 2023 were 24.0% and 22.7%, respectively.

Earnings Per Share

Diluted earnings per share were $3.15 for the third quarter of fiscal 2023, ~~or six~~compared with $2.79 for the third quarter of fiscal 2022. Diluted earnings per share were $8.62 for the nine months ended ~~February 28,~~May 31, 2023, compared with $8.11 for the nine months ended May 31, 2022. The $267 million of business optimization costs, net of related taxes, decreased diluted earnings per share by $0.42 and the $244 million investment gain, net of related taxes, increased diluted earnings per share by $0.38 for the third quarter of fiscal 2023.

Excluding these impacts, diluted earnings per share were $3.19 for the third quarter of fiscal 2023. The $459 million of business optimization costs, net of related taxes, decreased diluted earnings per share by $0.72 and the $244


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ACCENTURE FORM 10-Q	Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	26

~~Earnings Per Share~~

Diluted earnings per share were $2.39 for the second quarter of fiscal 2023, compared with $2.54 for the second quarter of fiscal 2022. Diluted earnings per share were $5.47 for the six months ended February 28, 2023, compared with $5.32 for the six months ended February 28, 2022. The $193 million ~~of business optimization costs,~~investment gain, net of related taxes, ~~decreased~~increased diluted earnings per share by ~~$0.30~~$0.38 for the ~~second quarter of fiscal 2023 and six~~nine months ended ~~February 28,~~May 31, 2023. Excluding these impacts, diluted earnings per share were ~~$2.69 and $5.77~~$8.96 for the ~~second quarter of fiscal 2023 and six~~nine months ended ~~February 28, 2023, respectively.~~May 31, 2023.

Non-GAAP Financial Measures

WeFor fiscal 2023, we have presented ~~operating income, operating margin,~~ effective tax rates and diluted earnings per share ~~for fiscal 2023,~~ excluding the ~~impact of~~business optimization costs and investment gain, as well as operating income and operating margin excluding the business optimization costs, as we believe doing so facilitates understanding as to the impact of these items and our performance in comparison to the prior ~~period.~~periods. While we believe that this non-GAAP financial information is useful in evaluating our operations, this information should be considered as supplemental in nature and not as a substitute for the related financial information prepared in accordance with GAAP.

New Bookings


		Three Months Ended				Percent Increase (Decrease) U.S. Dollars				Percent Increase (Decrease) Local Currency			Three Months Ended								Percent Increase (Decrease) U.S. Dollars			Percent Increase (Decrease) Local Currency
(in billions of U.S. dollars)	(in billions of U.S. dollars)	February 28, 2023		February 28, 2022				(in billions of U.S. dollars)	May 31, 2023			May 31, 2022
Consulting	Consulting	$	10.7	$	10.9			(2)	%				2		%	Consulting		$	8.9	$	9.1		(2)		%		1	%
Managed Services (1)	Managed Services (1)	11.4		8.7		32				37		Managed Services (1)	8.3			7.8					6			9
Total New Bookings	Total New Bookings	$	22.1	$	19.6	13	%			17	%	Total New Bookings	$	17.2		$	17.0				2	%		4		%

Amounts in table may not total due to rounding.

(1)Previously referred to as our outsourcing business.


		Six Months Ended				Percent Increase (Decrease) U.S. Dollars				Percent Increase (Decrease) Local Currency			Nine Months Ended								Percent Increase (Decrease) U.S. Dollars			Percent Increase (Decrease) Local Currency
(in billions of U.S. dollars)	(in billions of U.S. dollars)	February 28, 2023		February 28, 2022				(in billions of U.S. dollars)	May 31, 2023			May 31, 2022
Consulting	Consulting	$	18.8	$	20.3			(8)	%				(2)		%	Consulting		$	27.7	$	29.4		(6)		%		(1)	%
Managed Services (1)	Managed Services (1)	19.5		16.1		22				29		Managed Services (1)	27.9			23.9					17			22
Total New Bookings	Total New Bookings	$	38.3	$	36.4	5	%			12	%	Total New Bookings	$	55.6		$	53.3				4	%		10		%

(1)Previously referred to as our outsourcing business.

We provide information regarding our new bookings, which include new contracts, including those acquired through acquisitions, as well as renewals, extensions and changes to existing contracts, because we believe doing so provides useful trend information regarding changes in the volume of our new business over time. New bookings can vary significantly quarter to quarter depending in part on the timing of the signing of a small number of large managed services contracts. The types of services and solutions clients are demanding and the pace and level of their spending may impact the conversion of new bookings to revenues. For example, managed services bookings, which are typically for multi-year contracts, generally convert to revenue over a longer period of time compared to consulting bookings.

Information regarding our new bookings is not comparable to, nor should it be substituted for, an analysis of our revenues over time. New bookings involve estimates and judgments. There are no third-party standards or requirements governing the calculation of bookings. We do not update our new bookings for material subsequent terminations or reductions related to bookings originally recorded in prior fiscal years. New bookings are recorded using then-existing foreign currency exchange rates and are not subsequently adjusted for foreign currency exchange rate fluctuations.

The majority of our contracts are terminable by the client on short notice with little or no termination penalties, and some without notice. Only the non-cancelable portion of these contracts is included in our remaining performance obligations disclosed in Note 2 (Revenues) to our Consolidated Financial Statements under Item 1, “Financial Statements.” Accordingly, a significant portion of what we consider contract bookings is not included in our remaining performance obligations.


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

Results of Operations for the Three Months Ended ~~February 28,~~May 31, 2023 Compared to the Three Months Ended ~~February 28,~~May 31, 2022

Revenues by geographic market, industry group and type of work are as follows:


		Three Months Ended				Percent Increase (Decrease) U.S. Dollars				Percent Increase (Decrease) Local Currency				Percent of Revenues for the Three Months Ended							Three Months Ended								Percent Increase (Decrease) U.S. Dollars			Percent Increase (Decrease) Local Currency		Percent of Revenues for the Three Months Ended
(in millions of U.S. dollars)	(in millions of U.S. dollars)	February 28, 2023		February 28, 2022								February 28, 2023				February 28, 2022		(in millions of U.S. dollars)	May 31, 2023				May 31, 2022								May 31, 2023			May 31, 2022
Geographic Markets	Geographic Markets																			Geographic Markets
North America	North America	$	7,398	$	7,077			5	%			5	%			47	%			47	%	North America	$	7,721			$	7,614				1	%	2	%	47	%	47	%
Europe	Europe	5,300		5,010		6				12				34				33		Europe	5,615				5,350				5			7		34		33
Growth Markets	Growth Markets	3,116		2,960		5				14				20				20		Growth Markets	3,228				3,195				1			9		19		20
Total	Total	$	15,814	$	15,047	5	%			9	%			100	%			100	%	Total	$	16,565			$	16,159			3	%		5	%	100	%	100	%
Industry Groups (1)	Industry Groups (1)																			Industry Groups (1)
Communications, Media & Technology	Communications, Media & Technology	$	2,885	$	2,999	(4)	%			—	%			18	%			20	%	Communications, Media & Technology	$	2,880			$	3,223			(11)	%		(8)	%	17	%	20	%
Financial Services	Financial Services	3,003		2,872		5				10				19				19		Financial Services	3,138				3,079				2			5		19		19
Health & Public Service	Health & Public Service	3,024		2,687		13				15				19				18		Health & Public Service	3,266				2,917				12			14		20		18
Products	Products	4,719		4,523		4				9				30				30		Products	4,968				4,806				3			6		30		30
Resources	Resources	2,184		1,966		11				16				14				13		Resources	2,311				2,134				8			12		14		13
Total	Total	$	15,814	$	15,047	5	%			9	%			100	%			100	%	Total	$	16,565			$	16,159			3	%		5	%	100	%	100	%
Type of Work	Type of Work																			Type of Work
Consulting	Consulting	$	8,279	$	8,322	(1)	%			4	%			52	%			55	%	Consulting	$	8,693			$	9,032			(4)	%		(1)	%	52	%	56	%
Managed Services (2)	Managed Services (2)	7,535		6,724		12				16				48				45		Managed Services (2)	7,872				7,126				10			13		48		44
Total	Total	$	15,814	$	15,047	5	%			9	%			100	%			100	%	Total	$	16,565			$	16,159			3	%		5	%	100	%	100	%

Amounts in table may not total due to rounding.

(2)Previously referred to as our outsourcing business.

Revenues

The following revenues commentary discusses local currency revenue changes for the ~~second~~third quarter of fiscal 2023 compared to the ~~second~~third quarter of fiscal 2022:

Geographic Markets

•North America revenues increased 5%2% in local currency, led by growth in Public Service for our U.S. federal business, Health and Utilities. These increases were partially offset by ~~a decline~~declines in Communications & Media, High Tech, Software & Platforms and ~~High Tech.~~Banking & Capital Markets. Revenue growth was driven by the United States.

•Europe revenues increased ~~12% in local currency, led by growth in Industrial, Banking & Capital Markets and Public Service. Revenue growth was driven by Germany, Italy and France.~~

•~~Growth Markets revenues increased 14%~~7% in local currency, led by growth in Banking & Capital Markets, Industrial and Public Service. Revenue growth was driven by Italy, Germany and France.

•Growth Markets revenues increased 9% in local currency, led by growth in Public Service, Chemicals & Natural Resources and ~~Public Service.~~Banking & Capital Markets. Revenue growth was led by Japan.

Operating Expenses

Operating expenses for the ~~second~~third quarter of fiscal 2023 increased ~~$884~~$650 million, or 7%5%, compared to the ~~second~~third quarter of fiscal 2022, and increased as a percentage of revenues to ~~87.7%~~85.8% compared to ~~86.3%~~83.9% during this period. The increase as a percentage of revenues is primarily due to business optimization costs of ~~$244~~$347 million recorded induring the ~~second~~third quarter of fiscal 2023.


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

Operating expenses by category are as follows:
Three Months Ended
(in millions of U.S. dollars) February 28, 2023 February 28, 2022 Increase
(Decrease)
Operating Expenses $ 13,870 87.7 % $ 12,985 86.3 % $ 884
Cost of services 10,979 69.4 10,523 69.9 457
Sales and marketing 1,564 9.9 1,415 9.4 149
General and administrative costs 1,082 6.8 1,048 7.0 35
Business optimization costs 244 1.5 — — 244


	Three Months Ended
(in millions of U.S. dollars)	May 31, 2023				May 31, 2022				Increase (Decrease)
Operating Expenses	$	14,205	85.8	%	$	13,556	83.9	%	$	650
Cost of services	11,036		66.6		10,844		67.1		191
Sales and marketing	1,739		10.5		1,661		10.3		78
General and administrative costs	1,084		6.5		1,051		6.5		34
Business optimization costs	347		2.1		—		—		347

Amounts in table may not total due to rounding.

Cost of Services

Cost of services for the ~~second~~third quarter of fiscal 2023 increased ~~$457~~$191 million, or 4%2%, over the ~~second~~third quarter of fiscal 2022, and decreased as a percentage of revenues to ~~69.4%~~66.6% from ~~69.9%~~67.1% during this period. Gross margin for the ~~second~~third quarter of fiscal 2023 increased as a percentage of revenues to ~~30.6%~~33.4% over ~~30.1%~~32.9% during the ~~second~~third quarter of fiscal 2022. The increase in gross margin was primarily due to lower labor costs, including lower subcontractor costs, partially offset by higher non-payroll costs, primarily for travel compared to the same period in fiscal 2022.

Sales and Marketing

Sales and marketing expense for the ~~second~~third quarter of fiscal 2023 increased ~~$149~~$78 million, or ~~11%~~5%, over the ~~second~~third quarter of fiscal 2022, and increased as a percentage of revenues to ~~9.9%~~10.5% over ~~9.4%~~10.3% during this period due to higher selling and other business development costs.

General and Administrative Costs

General and administrative costs for the ~~second~~third quarter of fiscal 2023 increased ~~$35~~$34 million, or 3%, over the ~~second~~third quarter of fiscal 2022, and ~~decreased~~remained flat as a percentage of revenues ~~to 6.8% from 7.0%~~at 6.5% during this period.

Business Optimization Costs

During the ~~second~~third quarter of fiscal 2023, we recorded business optimization costs of ~~$244~~$347 million, primarily for employee severance. For additional information, see Note 1 (Basis of Presentation) to our Consolidated Financial Statements under Item 1, “Financial Statements.”

Operating Income and Operating Margin

Operating income for the ~~second~~third quarter of fiscal 2023 decreased ~~$117~~$244 million, or 6%9%, from the ~~second~~third quarter of fiscal 2022. Operating margin for the ~~second~~third quarter of fiscal 2023 was ~~12.3%~~14.2%, compared with ~~13.7%~~16.1% for the ~~second~~third quarter of fiscal 2022. The business optimization costs ~~decreased~~reduced operating margin by ~~150~~210 basis points. Excluding these costs, operating margin for the ~~second~~third quarter of fiscal 2023 increased 1020 basis points to ~~13.8%~~16.3%.

Operating income and operating margin for each of the geographic markets are as follows:


		Three Months Ended											Three Months Ended
		February 28, 2023				February 28, 2022							May 31, 2023				May 31, 2022
(in millions of U.S. dollars)	(in millions of U.S. dollars)	Operating Income		Operating Margin		Operating Income		Operating Margin		Increase (Decrease)		(in millions of U.S. dollars)	Operating Income		Operating Margin		Operating Income		Operating Margin		Increase (Decrease)
North America	North America	$	824	11	%	$	1,091	15	%	$	(267)	North America	$	1,241	16	%	$	1,380	18	%	$	(139)
Europe	Europe	574		11		532		11		42		Europe	632		11		694		13		(62)
Growth Markets	Growth Markets	547		18		439		15		108		Growth Markets	486		15		530		17		(43)
Total	Total	$	1,945	12.3	%	$	2,062	13.7	%	$	(117)	Total	$	2,359	14.2	%	$	2,603	16.1	%	$	(244)

Amounts in table may not total due to rounding.


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ACCENTURE FORM 10-Q	Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	29

Operating Income and Operating Margin Excluding Business Optimization Costs (Non-GAAP)


		Three Months Ended															Three Months Ended
		February 28, 2023								February 28, 2022							May 31, 2023								May 31, 2022
(in millions of U.S. dollars)	(in millions of U.S. dollars)	Operating Income (GAAP)		Business Optimization (1)		Operating Income (Non-GAAP)		Operating Margin (Non-GAAP)		Operating Income (GAAP)		Operating Margin (GAAP)		Increase (Decrease)		(in millions of U.S. dollars)	Operating Income (GAAP)		Business Optimization (1)		Operating Income (Non-GAAP)		Operating Margin (Non-GAAP)		Operating Income (GAAP)		Operating Margin (GAAP)		Increase (Decrease)
North America	North America	$	824	$	177	$	1,001	14	%	$	1,091	15	%	$	(90)	North America	$	1,241	$	96	$	1,338	17	%	$	1,380	18	%	$	(42)
Europe	Europe	574		40		614		12		532		11		82		Europe	632		166		798		14		694		13		104
Growth Markets	Growth Markets	547		27		574		18		439		15		135		Growth Markets	486		84		571		18		530		17		41
Total	Total	$	1,945	$	244	$	2,189	13.8	%	$	2,062	13.7	%	$	127	Total	$	2,359	$	347	$	2,706	16.3	%	$	2,603	16.1	%	$	103

Amounts in table may not total due to rounding.

(1)Costs recorded in connection with our business optimization initiatives, primarily for employee severance.

We estimate that the aggregate percentage impact of foreign currency exchange rates on our operating income during the ~~second~~third quarter of fiscal 2023 was similar to that disclosed for revenue for each geographic market. In addition, during the ~~second~~third quarter of fiscal 2023 each geographic market’s operating income was unfavorably impacted by business optimization costs. The commentary below provides insight into other factors affecting geographic market performance and operating income for the ~~second~~third quarter of fiscal 2023 compared with the ~~second~~third quarter of fiscal 2022:

•North America operating income decreased as ~~managed services~~ revenue growth was more than offset by lower consulting contract profitability as well as higher ~~labor costs, including an increase in~~ selling and other business development costs as a percentage of revenues.

•Europe operating income increased primarily due to revenue growth.

•Growth Markets operating income increased primarily due to ~~higher contract profitability~~revenue growth, partially offset by an increase in selling and ~~revenue growth.~~other business development costs as a percentage of revenues.

Interest Income

Interest income for the ~~second~~third quarter of fiscal 2023 was ~~$50~~$82 million, an increase of ~~$43~~$73 million over the ~~second~~third quarter of fiscal 2022. The increase was primarily due to higher interest rates.

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. During the ~~second~~third quarter of fiscal 2023, other income (expense), net increased ~~$29~~$211 million over the ~~second~~third quarter of fiscal 2022, primarily due to ~~foreign currency exchange losses.~~higher gains on investments. For additional information, see Note 1 (Basis of Presentation) to our Consolidated Financial Statements under Item 1, “Financial Statements.”

Loss on Disposition of Russia Business

We recorded a loss from the disposal of our business in Russia of $96 million during the third quarter of fiscal 2022.

Income Tax Expense

The effective tax rates for the ~~second~~third quarter of fiscal 2023 and 2022 were ~~20.4%~~22.2% and ~~19.2%~~27.1%, respectively. Absent the business optimization costs of $347 million and related reduction in tax expense of $80 million, and the investment gain of $253 million and related tax expense of $9 million, our effective tax rate was 24.0% for the three months ended May 31, 2023. The ~~higher~~lower effective tax rate for the ~~second~~third quarter of fiscal 2023 was primarily due to lower tax ~~benefits from share-based payments, partially offset by lower tax~~ expense from changes in the geographic distribution of ~~earnings. The business optimization costs of $244 million~~earnings and ~~related reduction in~~higher benefits from adjustments to prior year tax ~~expense of $52 million did not significantly impact our effective tax rate for the second quarter of fiscal 2023.~~liabilities.

Earnings Per Share

Diluted earnings per share were ~~$2.39~~$3.15 for the ~~second~~third quarter of fiscal 2023, compared with ~~$2.54~~$2.79 for the ~~second~~third quarter of fiscal 2022. The ~~$193~~$267 million of business optimization costs, net of related taxes, decreased diluted earnings per share by ~~$0.30 during~~$0.42 and the ~~second~~$244 million investment gain, net of related taxes, increased diluted earnings per share by $0.38 for the third quarter of fiscal 2023. Excluding ~~this impact,~~these impacts, diluted earnings per share were ~~$2.69~~$3.19 for the ~~second~~third quarter of fiscal 2023. For information regarding our earnings per share calculations, see Note 3 (Earnings Per Share) to our Consolidated Financial Statements under Item 1, “Financial Statements.”


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ACCENTURE FORM 10-Q	Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	30

The ~~decrease~~increase in diluted earnings per share iswas due to the following factors:


	Earnings Per Share
Q2Q3 FY22 As Reported	$	~~2.54~~2.79
Higher revenue and operating results	~~0.16~~0.12
Loss on disposition of Russia business recorded in fiscal 2022	0.15
Lower effective tax rate (excluding loss on disposition of Russia business)	0.09
Higher non-operating income (excluding loss on disposition of Russia business)	0.04
Lower share count	~~0.02~~
~~Higher non-operating income~~	~~0.02~~0.01
Higher net income attributable to noncontrolling interests	(0.01)
~~Higher effective tax rate~~	~~(0.04)~~
Q2Q3 FY23 As Adjusted	$	~~2.69~~3.19
Gain on an investment, net of tax	0.38
Business optimization costs	~~(0.30)~~(0.42)
Q2Q3 FY23 As Reported	$	~~2.39~~3.15


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ACCENTURE FORM 10-Q	Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	31

Results of Operations for the ~~Six~~Nine Months Ended ~~February 28,~~May 31, 2023 Compared to the ~~Six~~Nine Months Ended ~~February 28,~~May 31, 2022

Revenues by geographic market, industry group and type of work are as follows:


		Six Months Ended				Percent Increase (Decrease) U.S. Dollars				Percent Increase (Decrease) Local Currency				Percent of Revenues for the Six Months Ended							Nine Months Ended								Percent Increase (Decrease) U.S. Dollars			Percent Increase (Decrease) Local Currency		Percent of Revenues for the Nine Months Ended
(in millions of U.S. dollars)	(in millions of U.S. dollars)	February 28, 2023		February 28, 2022								February 28, 2023				February 28, 2022		(in millions of U.S. dollars)	May 31, 2023				May 31, 2022								May 31, 2023			May 31, 2022
Geographic Markets	Geographic Markets																			Geographic Markets
North America	North America	$	15,021	$	13,984			7	%			8	%			48	%			47	%	North America	$	22,742			$	21,598				5	%	6	%	47	%	47	%
Europe	Europe	10,372		10,110		3				15				33				34		Europe	15,988				15,460				3			12		33		33
Growth Markets	Growth Markets	6,169		5,918		4				17				20				20		Growth Markets	9,397				9,112				3			14		20		20
Total	Total	$	31,562	$	30,012	5	%			12	%			100	%			100	%	Total	$	48,127			$	46,171			4	%		10	%	100	%	100	%
Industry Groups (1)	Industry Groups (1)																			Industry Groups (1)
Communications, Media & Technology	Communications, Media & Technology	$	5,865	$	5,896	(1)	%			5	%			19	%			20	%	Communications, Media & Technology	$	8,745			$	9,119			(4)	%		1	%	18	%	20	%
Financial Services	Financial Services	5,966		5,790		3				11				19				19		Financial Services	9,104				8,869				3			9		19		19
Health & Public Service	Health & Public Service	6,024		5,417		11				15				19				18		Health & Public Service	9,290				8,334				11			15		19		18
Products	Products	9,384		8,991		4				12				30				30		Products	14,353				13,797				4			10		30		30
Resources	Resources	4,323		3,918		10				18				14				13		Resources	6,634				6,052				10			16		14		13
Total	Total	$	31,562	$	30,012	5	%			12	%			100	%			100	%	Total	$	48,127			$	46,171			4	%		10	%	100	%	100	%
Type of Work	Type of Work																			Type of Work
Consulting	Consulting	$	16,723	$	16,715	—	%			7	%			53	%			56	%	Consulting	$	25,416			$	25,747			(1)	%		4	%	53	%	56	%
Managed Services (2)	Managed Services (2)	14,839		13,297		12				18				47				44		Managed Services (2)	22,710				20,424				11			16		47		44
Total	Total	$	31,562	$	30,012	5	%			12	%			100	%			100	%	Total	$	48,127			$	46,171			4	%		10	%	100	%	100	%

Amounts in table may not total due to rounding.

(2)Previously referred to as our outsourcing business.

Revenues

The following revenues commentary discusses local currency revenue changes for the ~~six~~nine months ended ~~February 28,~~May 31, 2023 compared to the ~~six~~nine months ended ~~February 28,~~May 31, 2022:

Geographic Markets

•North America revenues increased 8%6% in local currency, led by growth in Public Service for our U.S. federal business, Health and ~~Consumer Goods, Retail~~Utilities. These increases were partially offset by a decline in Communications & ~~Travel Services.~~Media. Revenue growth was driven by the United States.

•Europe revenues increased ~~15%~~12% in local currency, led by growth in Industrial, Banking & Capital Markets and Public Service. Revenue growth was driven by Germany, Italy ~~France~~ and ~~the United Kingdom.~~France.

•Growth Markets revenues increased ~~17%~~14% in local currency, led by growth in Banking & Capital Markets, Public Service and Chemicals & Natural ~~Resources and Public Service.~~Resources. Revenue growth was led by Japan.

Operating Expenses

Operating expenses for the ~~six~~nine months ended ~~February 28,~~May 31, 2023 increased ~~$1,508~~$2,158 million, or 6%, compared to the ~~six~~nine months ended ~~February 28,~~May 31, 2022, and increased as a percentage of revenues to ~~85.6%~~85.7% compared to ~~85.0%~~84.6% during this period. The increase as a percentage of revenues is primarily due to business optimization costs of ~~$244~~$591 million recorded during the ~~six~~nine months ended ~~February 28,~~May 31, 2023.


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ACCENTURE FORM 10-Q	Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	32

Operating expenses by category are as follows:


		Six Months Ended											Nine Months Ended
(in millions of U.S. dollars)	(in millions of U.S. dollars)	February 28, 2023				February 28, 2022				Increase (Decrease)		(in millions of U.S. dollars)	May 31, 2023				May 31, 2022				Increase (Decrease)
Operating Expenses	Operating Expenses	$	27,024	85.6	%	$	25,516	85.0	%	$	1,508	Operating Expenses	$	41,230	85.7	%	$	39,072	84.6	%	$	2,158
Cost of services	Cost of services	21,541		68.3		20,571		68.5		970		Cost of services	32,577		67.7		31,415		68.0		1,161
Sales and marketing	Sales and marketing	3,114		9.9		2,869		9.6		244		Sales and marketing	4,852		10.1		4,530		9.8		322
General and administrative costs	General and administrative costs	2,125		6.7		2,076		6.9		50		General and administrative costs	3,210		6.7		3,126		6.8		83
Business optimization costs	Business optimization costs	244		0.8		—		—		244		Business optimization costs	591		1.2		—		—		591

Amounts in table may not total due to rounding.

Cost of Services

Cost of services for the ~~six~~nine months ended ~~February 28,~~May 31, 2023 increased ~~$970~~$1,161 million, or 5%4%, over the ~~six~~nine months ended ~~February 28,~~May 31, 2022, and decreased as a percentage of revenues to ~~68.3%~~67.7% from ~~68.5%~~68.0% during this period. Gross margin for the ~~six~~nine months ended ~~February 28,~~May 31, 2023 increased to ~~31.7%~~32.3% over ~~31.5%~~32.0% during the ~~six~~nine months ended ~~February 28,~~May 31, 2022. The increase in gross margin was primarily due to lower labor costs, including lower subcontractor costs, partially offset by higher non-payroll costs, primarily for travel compared to the same period in fiscal 2022.

Sales and Marketing

Sales and marketing expense for the ~~six~~nine months ended ~~February 28,~~May 31, 2023 increased ~~$244~~$322 million, or 9%7%, over the ~~six~~nine months ended ~~February 28,~~May 31, 2022, and increased as a percentage of revenues to ~~9.9%~~10.1% over ~~9.6%~~9.8% during this period due to higher selling and other business development costs.

General and Administrative Costs

General and administrative costs for the ~~six~~nine months ended ~~February 28,~~May 31, 2023 increased ~~$50~~$83 million, or 2%3%, over the ~~six~~nine months ended ~~February 28,~~May 31, 2022, and decreased as a percentage of revenues to 6.7% from ~~6.9%.~~6.8% during this period.

Business Optimization Costs

During the ~~six~~nine months ended ~~February 28,~~May 31, 2023, we recorded business optimization costs of ~~$244~~$591 million, primarily for employee severance. For additional information, see Note 1 (Basis of Presentation) to our Consolidated Financial Statements under Item 1, “Financial Statements.”

Operating Income and Operating Margin

Operating income for the ~~six~~nine months ended ~~February 28,~~May 31, 2023 ~~increased $42~~decreased $202 million, or 1%3%, ~~over~~compared with the ~~six~~nine months ended ~~February 28,~~May 31, 2022. Operating margin for the ~~six~~nine months ended ~~February 28,~~May 31, 2023 was ~~14.4%~~14.3%, compared with ~~15.0%~~15.4% for the ~~six~~nine months ended ~~February 28,~~May 31, 2022. The business optimization costs ~~decreased~~reduced operating margin by 80130 basis points. Excluding these costs, operating margin for the ~~six~~nine months ended ~~February 28,~~May 31, 2023 increased 20 basis points to ~~15.2%~~15.6%.

Operating income and operating margin for each of the geographic markets are as follows:

Six Months Ended
February 28, 2023 February 28, 2022
(in millions of U.S. dollars) Operating
Income Operating
Margin Operating
Income Operating
Margin Increase
(Decrease)
North America $ 2,134 14 % $ 2,335 17 % $ (202)
Europe 1,264 12 1,276 13 (13)
Growth Markets 1,140 18 884 15 256
Total $ 4,538 14.4 % $ 4,496 15.0 % $ 42

~~Amounts in table may not total due to rounding.~~


	Nine Months Ended
	May 31, 2023				May 31, 2022
(in millions of U.S. dollars)	Operating Income		Operating Margin		Operating Income		Operating Margin		Increase (Decrease)
North America	$	3,375	15	%	$	3,715	17	%	$	(340)
Europe	1,895		12		1,970		13		(75)
Growth Markets	1,627		17		1,414		16		213
Total	$	6,897	14.3	%	$	7,099	15.4	%	$	(202)


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ACCENTURE FORM 10-Q	Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	33

Operating Income and Operating Margin Excluding Business Optimization Costs (Non-GAAP)

Six Months Ended
February 28, 2023 February 28, 2022
(in millions of U.S. dollars) Operating
Income (GAAP) Business
Optimization (1) Operating
Income (Non-GAAP) Operating
Margin
(Non-GAAP) Operating
Income (GAAP) Operating
Margin (GAAP) Increase
(Decrease)
North America $ 2,134 $ 177 $ 2,311 15 % $ 2,335 17 % $ (25)
Europe 1,264 40 1,304 13 1,276 13 28
Growth Markets 1,140 27 1,167 19 884 15 283
Total $ 4,538 $ 244 $ 4,782 15.2 % $ 4,496 15.0 % $ 286

~~Amounts in table may not total due to rounding.~~


	Nine Months Ended
	May 31, 2023								May 31, 2022
(in millions of U.S. dollars)	Operating Income (GAAP)		Business Optimization (1)		Operating Income (Non-GAAP)		Operating Margin (Non-GAAP)		Operating Income (GAAP)		Operating Margin (GAAP)		Increase (Decrease)
North America	$	3,375	$	273	$	3,648	16	%	$	3,715	17	%	$	(67)
Europe	1,895		207		2,102		13		1,970		13		132
Growth Markets	1,627		111		1,738		18		1,414		16		324
Total	$	6,897	$	591	$	7,488	15.6	%	$	7,099	15.4	%	$	389

(1)Costs recorded in connection with our business optimization initiatives, primarily for employee severance.

We estimate that the aggregate percentage impact of foreign currency exchange rates on our operating income during the ~~six~~nine months ended ~~February 28,~~May 31, 2023 was similar to that disclosed for revenue for each geographic market. In addition, during the ~~six~~nine months ended ~~February 28,~~May 31, 2023 each geographic market’s operating income was unfavorably impacted by business optimization costs. The commentary below provides insight into other factors affecting geographic market performance and operating income, including the impact of foreign currency exchange rates where significant, for the ~~six~~nine months ended ~~February 28,~~May 31, 2023 compared with the ~~six~~nine months ended ~~February 28,~~May 31, 2022:

•North America operating income decreased as revenue growth was more than offset by higher labor costs, including an increase in selling and other business development costs as a percentage of revenues.

•Europe operating income increased due to revenue growth in local currency, partially offset by the negative impact of foreign currency exchange rates.

•Growth Markets operating income increased primarily due to higher contract profitability and revenue growth in local currency, partially offset by the negative impact of foreign currency exchange rates.

Interest Income

Interest income for the ~~six~~nine months ended ~~February 28,~~May 31, 2023 was ~~$95~~$177 million, an increase of ~~$82~~$155 million over the ~~six~~nine months ended ~~February 28,~~May 31, 2022. The increase was primarily due to higher interest rates.

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. During the ~~six~~nine months ended ~~February 28,~~May 31, 2023, other income (expense), net increased ~~$35~~$176 million over the ~~six~~nine months ended ~~February 28,~~May 31, 2022, primarily due to higher gains on investments, partially offset by foreign currency exchange losses. For additional information, see Note 1 (Basis of Presentation) to our Consolidated Financial Statements under Item 1, “Financial Statements."

Loss on Disposition of Russia Business

We recorded a loss from the disposal of our business in Russia of $96 million during the nine months ended May 31, 2022.

Income Tax Expense

The effective tax ~~rate~~rates for ~~both~~ the ~~six~~nine months ended ~~February 28,~~May 31, 2023 and 2022 ~~was 22.0%. The~~were 22.1% and 23.8%, respectively. Absent the business optimization costs of ~~$244~~$591 million and related reduction in tax expense of ~~$52~~$132 million, ~~did not significantly impact~~and the investment gain of $253 million and related tax expense of $9 million, our effective tax rate was 22.7% for the nine months ended May 31, 2023. The lower effective tax rate for the ~~six~~nine months ended ~~February 28, 2023.~~

~~Our provision for income taxes is based on many factors and subject~~May 31, 2023 was primarily due to ~~volatility year to year. We expect the fiscal 2023 annual effective~~lower tax ~~rate to be~~expense from changes in the ~~range~~geographic distribution of ~~22.5%~~earnings and higher benefits from adjustments to ~~24.5%, and adjusted annual effective~~prior year tax ~~rate, which excludes the~~liabilities, partially offset by lower tax impacts of business optimization costs and an anticipated investment gain, to be in the range of 23% to 25%. The effective tax rate for interim periods can vary because of the timing of when certain events occur during the year.benefits from share-based payments.

Earnings Per Share

Diluted earnings per share were ~~$5.47~~$8.62 for the ~~six~~nine months ended ~~February 28,~~May 31, 2023, compared with ~~$5.32~~$8.11 for the ~~six~~nine months ended ~~February 28,~~May 31, 2022. The ~~$193~~$459 million of business optimization costs, net of related taxes, decreased diluted earnings per share by ~~$0.30 during~~$0.72 and the ~~six~~$244 million investment gain, net of related taxes, increased diluted earnings per share by $0.38 for the nine months ended ~~February 28,~~May 31, 2023. Excluding ~~this impact,~~these impacts, diluted earnings per share were ~~$5.77~~$8.96 for the ~~six~~nine months ended ~~February 28,~~May 31, 2023. For information regarding our earnings per share calculations, see Note 3 (Earnings Per Share) to our Consolidated Financial Statements under Item 1, “Financial Statements.”


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ACCENTURE FORM 10-Q	Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	34

The increase in diluted earnings per share iswas due to the following factors:


	Earnings Per Share
FY22 As Reported	$	~~5.32~~8.11
Higher revenue and operating results	~~0.35~~0.46
Loss on disposition of Russia business recorded in fiscal 2022	0.15
Higher non-operating income (excluding loss on disposition of Russia business)	~~0.06~~0.10
Lower effective tax rate (excluding loss on disposition of Russia business)	0.09
Lower share count	~~0.05~~0.07
Higher net income attributable to noncontrolling interests	~~(0.01)~~(0.02)

FY23 As Adjusted	$	~~5.77~~8.96
Gain on an investment, net of tax	0.38
Business optimization costs	~~(0.30)~~(0.72)
FY23 As Reported	$	~~5.47~~8.62


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ACCENTURE FORM 10-Q	Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	35

Liquidity and Capital Resources

As of ~~February 28,~~May 31, 2023, Cash and cash equivalents was ~~$6.2~~$8.5 billion, compared with $7.9 billion as of August 31, 2022.

Cash flows from operating, investing and financing activities, as reflected in our Consolidated Cash Flows Statements, are summarized in the following table:


		Six Months Ended							Nine Months Ended
(in millions of U.S. dollars)	(in millions of U.S. dollars)	February 28, 2023		February 28, 2022		Change		(in millions of U.S. dollars)	May 31, 2023		May 31, 2022		Change
Net cash provided by (used in):	Net cash provided by (used in):							Net cash provided by (used in):
Operating activities	Operating activities	$	2,826	$	2,686	$	139	Operating activities	$	6,115	$	5,751	$	364
Investing activities	Investing activities	(1,260)		(2,185)		925		Investing activities	(1,255)		(2,852)		1,597
Financing activities	Financing activities	(3,192)		(3,106)		(86)		Financing activities	(4,165)		(4,210)		45
Effect of exchange rate changes on cash and cash equivalents	Effect of exchange rate changes on cash and cash equivalents	(24)		(97)		73		Effect of exchange rate changes on cash and cash equivalents	(49)		(154)		105
Net increase (decrease) in cash and cash equivalents	Net increase (decrease) in cash and cash equivalents	$	(1,651)	$	(2,702)	$	1,051	Net increase (decrease) in cash and cash equivalents	$	646	$	(1,465)	$	2,110

Amounts in table may not total due to rounding.

Operating activities: The ~~$139~~$364 million increase in operating cash flows was primarily due to higher net income as well as higher collections on net client balances (receivables from clients, contract assets and deferred revenues), partially offset by higher spending on certain compensation payments.

Investing activities: The ~~$925~~$1,597 million decrease in cash used was primarily due to lower spending on business acquisitions and ~~purchases~~higher proceeds from the sale of ~~property~~businesses and ~~equipment.~~investments. For additional information, see Note 5 (Business Combinations) to our Consolidated Financial Statements under Item 1, “Financial Statements.”

Financing activities: The ~~$86~~$45 million ~~increase~~decrease in cash used was primarily due to ~~an increase~~a decrease in ~~cash dividends paid, partially offset by~~the net purchases of shares as well as an increase in net proceeds from share ~~issuances.~~issuances, partially offset by an increase in cash dividends paid. For additional information, see Note 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 ~~February 28,~~May 31, 2023, 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	$	3,000	$	—
Separate, uncommitted, unsecured multicurrency revolving credit facilities	~~1,708~~1,755		—
Local guaranteed and non-guaranteed lines of credit	~~243~~246		—
Total	$	~~4,951~~5,001	$	—

Under the borrowing facilities described above, we had an aggregate of ~~$912~~$1,028 million of letters of credit outstanding as of ~~February 28,~~May 31, 2023. We have a short-term commercial paper financing program backed by our $3 billion syndicated credit facility. As of ~~February 28,~~May 31, 2023, we had no commercial paper outstanding.


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ACCENTURE FORM 10-Q	Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	36

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 ~~six~~nine months ended ~~February 28,~~May 31, 2023 is as follows:

Accenture plc Class A
Ordinary Shares Accenture Canada
Holdings Inc. Exchangeable Shares
(in millions of U.S. dollars, except share amounts) Shares Amount Shares Amount
Open-market share purchases (1) 6,989,255 $ 1,910 — $ —
Other share purchase programs — — 7,935 2
Other purchases (2) 2,305,789 624 — —
Total 9,295,044 $ 2,535 7,935 $ 2

~~Amounts in table may not total due to rounding.~~


	Accenture plc Class A Ordinary Shares			Accenture Canada Holdings Inc. Exchangeable Shares
(in millions of U.S. dollars, except share amounts)	Shares	Amount		Shares	Amount
Open-market share purchases (1)	9,623,466	$	2,647	—	$	—
Other share purchase programs	—	—		13,935	4
Other purchases (2)	2,486,767	675		—	—
Total	12,110,233	$	3,322	13,935	$	4

(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 ~~six~~nine months ended ~~February 28,~~May 31, 2023, 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 2023. 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 10 (Commitments and Contingencies) to our Consolidated Financial Statements under Item 1, “Financial Statements.”

Significant Accounting Policies

See Note 1 (Basis of Presentation) to our Consolidated Financial Statements under Item 1, “Financial Statements.”


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ACCENTURE FORM 10-Q	Item 3. Quantitative and Qualitative Disclosures About Market Risk	37

Item 3. Quantitative and Qualitative Disclosures About Market Risk

During the ~~six~~nine months ended ~~February 28,~~May 31, 2023, 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, 2022. For a discussion of our market risk associated with foreign currency risk, interest rate risk and equity price risk as of August 31, 2022, 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, 2022.

Item 4. Controls 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

There has been no change in our internal control over financial reporting that occurred during the ~~second~~third quarter of fiscal 2023 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.


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ACCENTURE FORM 10-Q	Part II — Other Information	38

Part II — Other Information

Item 1. Legal Proceedings

The information set forth under “Legal Contingencies” in Note 10 (Commitments and Contingencies) to our Consolidated Financial Statements under Part I, Item 1, “Financial Statements,” is incorporated herein by reference.

Item 1A. Risk Factors

For a discussion of our potential risks and uncertainties, see the information under the heading “Risk Factors” in our Annual Report on Form 10-K for the year ended August 31, 2022 (the “Annual Report”). There have been no material changes to the risk factors disclosed in our Annual Report.

Item 2. Unregistered 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 ~~second~~third quarter of fiscal 2023.

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)
December 1, 2022 — December 31, 2022 1,395,374 $ 277.93 1,196,660 $ 4,569
January 1, 2023 — January 31, 2023 2,419,631 270.25 1,279,329 4,217
February 1, 2023 — February 28, 2023 270,275 280.52 — 4,217
Total (4) 4,085,280 $ 273.55 2,475,989


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)
March 1, 2023 — March 31, 2023	266,578	$	276.04	242,375	$	4,149
April 1, 2023 — April 30, 2023	992,346	278.92		975,270	3,877
May 1, 2023 — May 31, 2023	1,556,265	280.75		1,416,566	3,478
Total (4)	2,815,189	$	279.66	2,634,211

(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 ~~second~~third quarter of fiscal 2023, we purchased ~~2,475,989~~2,634,211 Accenture plc Class A ordinary shares under this program for an aggregate price of ~~$680~~$737 million. The open-market purchase program does not have an expiration date.

(3)As of ~~February 28,~~May 31, 2023, our aggregate available authorization for share purchases and redemptions was ~~$4,217~~$3,478 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 ~~February 28,~~May 31, 2023, the Board of Directors of Accenture plc has authorized an aggregate of $46.1 billion for share purchases and redemptions by Accenture plc and Accenture Canada Holdings Inc.

(4)During the ~~second~~third quarter of fiscal 2023, Accenture purchased ~~1,609,291~~180,978 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.

Item 3. Defaults Upon Senior Securities

None.


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ACCENTURE FORM 10-Q	Part II — Other Information	39

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

(a) None.

(b) None.

Item 6. Exhibits

Exhibit Index:


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

10.1*						~~Form of Director Restricted Share Unit Agreement pursuant to the Amended and Restated Accenture plc 2010 Share Incentive Plan (filed herewith~~)

10.2*						~~Form of Key Executive Performance-Based Award Restricted Share Unit Agreement pursuant to the Amended and Restated Accenture plc 2010 Share Incentive Plan (filed herewith~~)

10.3*						~~Form of Accenture Leadership Performance Equity Award Restricted Share Unit Agreement pursuant to the Amended and Restated Accenture plc 2010 Share Incentive Plan (filed herewith~~)

10.4*						~~Form of Voluntary Equity Investment Program Matching Grant Restricted Share Unit Agreement pursuant to the Amended and Restated Accenture plc 2010 Share Incentive Plan (filed herewith~~)

10.5*						~~Form of CEO Discretionary Grant Restricted Share Unit Agreement pursuant to the Amended and Restated Accenture plc 2010 Share Incentive Plan (filed herewith~~)

10.6*						~~Form of Fiscal 2023 Key Executive Performance-Based Award Restricted Share Unit Agreement in France (filed herewith~~)

10.7*						~~Form of Fiscal 2023 Accenture Leadership Performance Equity 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)

101						The following financial information from Accenture plc’s Quarterly Report on Form 10-Q for the quarterly period ended ~~February 28,~~May 31, 2023, formatted in Inline XBRL: (i) Consolidated Balance Sheets as of ~~February 28,~~May 31, 2023 (Unaudited) and August 31, 2022, (ii) Consolidated Income Statements (Unaudited) for the three and ~~six~~nine months ended ~~February 28,~~May 31, 2023 and ~~February 28,~~May 31, 2022, (iii) Consolidated Statements of Comprehensive Income (Unaudited) for the three and ~~six~~nine months ended ~~February 28,~~May 31, 2023 and ~~February 28,~~May 31, 2022, (iv) Consolidated Shareholders’ Equity Statement (Unaudited) for the three and ~~six~~nine months ended ~~February 28,~~May 31, 2023 and ~~February 28,~~May 31, 2022, (v) Consolidated Cash Flows Statements (Unaudited) for the ~~six~~nine months ended ~~February 28,~~May 31, 2023 and ~~February 28,~~May 31, 2022 and (vi) the Notes to Consolidated Financial Statements (Unaudited)

104						The cover page from Accenture plc’s Quarterly Report on Form 10-Q for the quarterly period ended ~~February 28,~~May 31, 2023, formatted in Inline XBRL (included as Exhibit 101)


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


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ACCENTURE FORM 10-Q	Signatures	40

Signatures

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

Date: ~~March 23,~~June 22, 2023


			ACCENTURE PLC

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