e10vq
 

 
 
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
Form 10-Q
(Mark One)
     
þ   QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED NOVEMBER 30, 2006
OR
     
o   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM                                        TO
Commission File Number: 001-16565
 
ACCENTURE LTD
(Exact name of Registrant as specified in its charter)
     
Bermuda   98-0341111
(State or other jurisdiction of   (I.R.S. Employer
incorporation or organization)   Identification No.)
Canon’s Court
22 Victoria Street
Hamilton HM 12, Bermuda

(Address of principal executive offices)
(441) 296-8262
(Registrant’s telephone number, including area code)
     Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes þ     No o
     Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer or a non-accelerated filer. See definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act. (Check one):
Large accelerated filer þ     Accelerated filer o     Non-accelerated filer o
     Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o     No þ
     The number of shares of the registrant’s Class A common shares, par value $0.0000225 per share, outstanding as of December 15, 2006 was 589,171,333 (which number does not include 34,614,467 issued shares held by subsidiaries of the registrant). The number of shares of the Registrant’s Class X common shares, par value $0.0000225 per share, outstanding as of December 15, 2006 was 192,488,100.
 
 

1


 

ACCENTURE LTD
INDEX
         
        Page
Part I.
  Financial Information   3
Item 1.
  Financial Statements   3
 
  Consolidated Balance Sheets as of November 30, 2006 (unaudited) and August 31, 2006   3
 
  Consolidated Income Statements (unaudited) for the three months ended November 30, 2006 and 2005   4
 
  Consolidated Shareholders’ Equity and Comprehensive Income Statements (unaudited) for the three    
 
  months ended November 30, 2006   5
 
  Consolidated Cash Flows Statements (unaudited) for the three months ended November 30, 2006 and 2005   6
 
  Notes to Consolidated Financial Statements (unaudited)   7
Item 2.
  Management’s Discussion and Analysis of Financial Condition and Results of Operations   14
Item 3.
  Quantitative and Qualitative Disclosures About Market Risk   25
Item 4.
  Controls and Procedures   25
Part II.
  Other Information   26
Item 1.
  Legal Proceedings   26
Item 1A.
  Risk Factors   26
Item 2.
  Unregistered Sales of Equity Securities and Use of Proceeds; Issuer Purchases of Equity Securities   27
Item 3.
  Defaults upon Senior Securities   28
Item 4.
  Submission of Matters to a Vote of Security Holders   29
Item 5.
  Other Information   29
Item 6.
  Exhibits   29
Signatures   30

2


 

PART I — FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
ACCENTURE LTD
CONSOLIDATED BALANCE SHEETS
November 30, 2006 and August 31, 2006
(In thousands of U.S. dollars, except share and per share amounts)
                 
    November 30,     August 31,  
    2006     2006  
    (Unaudited)          
ASSETS
               
CURRENT ASSETS:
               
Cash and cash equivalents
  $ 2,437,530     $ 3,066,988  
Short-term investments
    298,851       352,951  
Receivables from clients, net of allowances of $44,289 and $48,069, respectively
    2,257,954       1,916,450  
Unbilled services
    1,549,652       1,350,211  
Deferred income taxes, net
    194,442       187,720  
Other current assets
    464,492       479,501  
 
           
Total current assets
    7,202,921       7,353,821  
 
           
NON-CURRENT ASSETS:
               
Unbilled services
    77,904       105,081  
Investments
    123,049       125,119  
Property and equipment, net of accumulated depreciation of $1,402,242 and $1,359,978, respectively
    715,881       727,692  
Goodwill
    527,350       527,648  
Deferred income taxes, net
    391,249       392,211  
Other non-current assets
    176,219       186,508  
 
           
Total non-current assets
    2,011,652       2,064,259  
 
           
TOTAL ASSETS
  $ 9,214,573     $ 9,418,080  
 
           
LIABILITIES AND SHAREHOLDERS’ EQUITY
               
CURRENT LIABILITIES:
               
Short-term bank borrowings
  $ 2,635     $ 2,218  
Current portion of long-term debt
    23,833       22,574  
Accounts payable
    829,302       856,087  
Deferred revenues
    1,478,007       1,511,259  
Accrued payroll and related benefits
    1,767,803       1,693,796  
Income taxes payable
    890,847       722,096  
Deferred income taxes, net
    37,913       49,870  
Other accrued liabilities
    891,626       958,582  
 
           
Total current liabilities
    5,921,966       5,816,482  
 
           
NON-CURRENT LIABILITIES:
               
Long-term debt
    5,109       27,065  
Retirement obligation
    515,271       492,555  
Deferred income taxes, net
    19,720       16,880  
Other non-current liabilities
    297,999       302,965  
 
           
Total non-current liabilities
    838,099       839,465  
 
           
COMMITMENTS AND CONTINGENCIES
               
MINORITY INTEREST
    730,483       867,878  
SHAREHOLDERS’ EQUITY:
               
Preferred shares, 2,000,000,000 shares authorized, zero shares issued and outstanding
           
Class A common shares, par value $0.0000225 per share, 20,000,000,000 shares authorized, 623,292,451 and 617,565,722 shares issued as of November 30, 2006 and August 31, 2006, respectively
    14       14  
Class X common shares, par value $0.0000225 per share, 1,000,000,000 shares authorized, 226,253,923 and 245,006,562 shares issued and outstanding as of November 30, 2006 and August 31, 2006, respectively
    5       6  
Restricted share units
    510,632       482,289  
Additional paid-in capital
    455,805       701,006  
Treasury shares, at cost, 34,773,596 and 36,990,533 shares as of November 30, 2006 and August 31, 2006, respectively
    (814,812 )     (869,957 )
Retained earnings
    1,576,657       1,607,391  
Accumulated other comprehensive loss
    (4,276 )     (26,494 )
 
           
Total shareholders’ equity
    1,724,025       1,894,255  
 
           
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY
  $ 9,214,573     $ 9,418,080  
 
           
The accompanying Notes are an integral part of these Consolidated Financial Statements.

3


 

ACCENTURE LTD
CONSOLIDATED INCOME STATEMENTS
For the Three Months Ended November 30, 2006 and 2005
(In thousands of U.S. dollars, except share and per share amounts)
(Unaudited)
                 
    2006     2005  
REVENUES:
               
Revenues before reimbursements
  $ 4,754,088     $ 4,169,475  
Reimbursements
    412,271       373,541  
 
           
Revenues
    5,166,359       4,543,016  
OPERATING EXPENSES:
               
Cost of services:
               
Cost of services before reimbursable expenses
    3,321,844       2,849,167  
Reimbursable expenses
    412,271       373,541  
 
           
Cost of services
    3,734,115       3,222,708  
Sales and marketing
    436,930       408,602  
General and administrative costs
    379,643       393,766  
Reorganization costs
    6,079       5,384  
 
           
Total operating expenses
    4,556,767       4,030,460  
 
           
OPERATING INCOME
    609,592       512,556  
Gain on investments, net
    2,854       1,438  
Interest income
    36,307       30,353  
Interest expense
    (5,122 )     (4,685 )
Other expense
    (2,466 )     (15,947 )
 
           
INCOME BEFORE INCOME TAXES
    641,165       523,715  
Provision for income taxes
    235,308       195,869  
 
           
INCOME BEFORE MINORITY INTEREST
    405,857       327,846  
Minority interest in Accenture SCA and Accenture Canada Holdings Inc.
    (115,813 )     (110,136 )
Minority interest – other
    (5,812 )     (2,770 )
 
           
NET INCOME
  $ 284,232     $ 214,940  
 
           
 
               
Weighted average Class A common shares:
               
Basic
    598,612,668       586,267,569  
Diluted
    875,332,780       914,057,273  
Earnings per Class A common share:
               
Basic
  $ 0.47     $ 0.37  
Diluted
  $ 0.46     $ 0.36  
Cash dividends per share
  $ 0.35     $ 0.30  
The accompanying Notes are an integral part of these Consolidated Financial Statements.

4


 

ACCENTURE LTD
CONSOLIDATED SHAREHOLDERS’ EQUITY AND COMPREHENSIVE INCOME STATEMENTS
For the Three Months Ended November 30, 2006
(In thousands of U.S. dollars and in thousands of share amounts)
(Unaudited)
                                                                                                 
            Class A     Class X                                                      
            Common     Common                                                      
            Shares     Shares             Additional     Treasury Shares                      
    Preferred             No.             No.     Restricted     Paid-in             No.     Retained     Accumulated Other        
    Shares     $     Shares     $     Shares     Share Units     Capital     $     Shares     Earnings     Comprehensive Loss     Total  
Balance as of August 31, 2006
  $     $ 14       617,566     $ 6       245,007     $ 482,289     $ 701,006     $ (869,957 )     (36,991 )   $ 1,607,391     $ (26,494 )   $ 1,894,255  
Comprehensive income:
                                                                                               
Net income
                                                                            284,232               284,232  
Other comprehensive income:
                                                                                               
Unrealized gains on marketable securities, net of reclassification adjustments
                                                                                    856       856  
Foreign currency translation adjustments
                                                                                    21,362       21,362  
 
                                                                                             
Other comprehensive income
                                                                                    22,218        
Comprehensive income
                                                                                            306,450  
Income tax benefit on share-based compensation plans
                                                    20,081                                       20,081  
Purchases of Class A common shares
                    (245 )                             (7,654 )     (58,087 )     (2,267 )                     (65,741 )
Share-based compensation expense
                                            44,484       17,028                                       61,512  
Purchases/redemptions of Accenture SCA Class I common shares and Accenture Canada Holdings Inc. exchangeable shares
                            (1 )     (18,753 )             (657,985 )                                     (657,986 )
Issuances of Class A common shares related to employee share programs
                    5,971                       (33,138 )     121,786       113,232       4,484       (4,910 )             196,970  
Dividends
                                            16,997                               (310,056 )             (293,059 )
Minority interest
                                                    261,543                                       261,543  
 
                                                                       
Balance as of November 30, 2006
  $     $ 14       623,292     $ 5       226,254     $ 510,632     $ 455,805     $ (814,812 )     (34,774 )   $ 1,576,657     $ (4,276 )   $ 1,724,025  
 
                                                                       
The accompanying Notes are an integral part of these Consolidated Financial Statements.

5


 

ACCENTURE LTD
CONSOLIDATED CASH FLOWS STATEMENTS
For the Three Months Ended November 30, 2006 and 2005
(In thousands of U.S. dollars)
(Unaudited)
                 
    2006     2005  
CASH FLOWS FROM OPERATING ACTIVITIES:
               
Net income
  $ 284,232     $ 214,940  
Adjustments to reconcile Net income to Net cash provided by operating activities —
               
Depreciation, amortization and asset impairments
    144,981       79,271  
Reorganization costs, net
    6,079       5,384  
Share-based compensation expense
    62,234       50,832  
Deferred income taxes, net
    (12,142 )     (39,310 )
Minority interest
    121,625       112,906  
Other, net
    1,404       (1,224 )
Change in assets and liabilities, net of acquisitions —
               
Receivables from clients, net
    (302,720 )     (166,078 )
Other current assets
    16,155       28,944  
Unbilled services, current and non-current
    (183,813 )     (116,159 )
Other non-current assets
    (10,628 )     (9,423 )
Accounts payable
    (45,563 )     (6,147 )
Deferred revenues
    (58,623 )     55,891  
Accrued payroll and related benefits
    51,953       (91,696 )
Income taxes payable
    165,245       193,572  
Other accrued liabilities
    (87,833 )     13,091  
Other non-current liabilities
    13,242       43,587  
 
           
Net cash provided by operating activities
    165,828       368,381  
 
           
CASH FLOWS FROM INVESTING ACTIVITIES:
               
Proceeds from maturities and sales of available-for-sale investments
    333,833       252,865  
Purchases of available-for-sale investments
    (272,107 )     (14,242 )
Proceeds from sales of property and equipment
    3,557       1,400  
Purchases of property and equipment
    (67,144 )     (77,956 )
Purchases of businesses and investments, net of cash acquired
    (19,862 )     (5,127 )
 
           
Net cash (used in) provided by investing activities
    (21,723 )     156,940  
 
           
CASH FLOWS FROM FINANCING ACTIVITIES:
               
Proceeds from issuance of common shares
    196,970       149,067  
Purchases of common shares
    (723,727 )     (1,153,262 )
Proceeds from long-term debt
    1,851       7,617  
Repayments of long-term debt
    (6,633 )     (16,989 )
Proceeds from short-term borrowings
    3,091       5,889  
Repayments of short-term borrowings
    (2,776 )     (16,220 )
Cash dividends paid
    (293,059 )     (267,973 )
Excess tax benefits from share-based payment arrangements
    12,680       18,094  
Other, net
    (2,887 )     (4,363 )
 
           
Net cash used in financing activities
    (814,490 )     (1,278,140 )
Effect of exchange rate changes on cash and cash equivalents
    40,927       (45,174 )
 
           
NET DECREASE IN CASH AND CASH EQUIVALENTS
    (629,458 )     (797,993 )
CASH AND CASH EQUIVALENTS, beginning of period
    3,066,988       2,483,990  
 
           
CASH AND CASH EQUIVALENTS, end of period
  $ 2,437,530     $ 1,685,997  
 
           
The accompanying Notes are an integral part of these Consolidated Financial Statements.

6


 

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

(Unaudited)
1. BASIS OF PRESENTATION
     The accompanying unaudited interim Consolidated Financial Statements of Accenture Ltd, a Bermuda company, and its controlled subsidiary companies (together the “Company”) have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) for quarterly reports on Form 10-Q and do not include all of the information and note disclosures required by U.S. generally accepted accounting principles for complete financial statements. These Consolidated Financial Statements should therefore be read in conjunction with the Consolidated Financial Statements and Notes thereto for the fiscal year ended August 31, 2006, included in the Company’s Annual Report on Form 10-K filed with the SEC on October 18, 2006. The accompanying unaudited interim Consolidated Financial Statements have been prepared in accordance with U.S. generally accepted accounting principles and reflect all adjustments of a normal, recurring nature that are, in the opinion of management, necessary for a fair presentation of results for these interim periods. The results of operations for the three months ended November 30, 2006 are not necessarily indicative of the results that may be expected for the fiscal year ending August 31, 2007. Certain prior-period amounts have been reclassified to conform to the current-period presentation.
2. EARNINGS PER SHARE
     Basic and diluted earnings per share were calculated as follows:
     Basic earnings per share
                 
    Three Months Ended  
    November 30,  
    2006     2005  
Net income available for Class A common shareholders
  $ 284,232     $ 214,940  
Basic weighted average Class A common shares
    598,612,668       586,267,569  
 
           
Basic earnings per share
  $ 0.47     $ 0.37  
 
           

7


 

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

(Unaudited)
     Diluted earnings per share
                 
    Three Months Ended  
    November 30,  
    2006     2005  
Net income available for Class A common shareholders
  $ 284,232     $ 214,940  
Minority interest in Accenture SCA and Accenture Canada Holdings Inc. (1)
    115,813       110,136  
 
           
Net income per share calculation
  $ 400,045     $ 325,076  
 
           
 
               
Basic weighted average Class A common shares
    598,612,668       586,267,569  
Class A common shares issuable upon redemption/exchange of minority interest (1)
    243,939,464       300,411,591  
Diluted effect of employee compensation related to Class A common shares
    32,730,465       27,344,964  
Diluted effect of employee share purchase plan related to Class A common shares
    50,183       33,149  
 
           
Weighted average Class A common shares
    875,332,780       914,057,273  
 
           
Diluted earnings per share
  $ 0.46     $ 0.36  
 
           
 
(1)   Diluted earnings per share assumes the redemption and exchange of all Accenture SCA Class I common shares and Accenture Canada Holdings Inc. exchangeable shares, respectively, for Accenture Ltd Class A common shares, on a one-for-one basis. The income effect does not take into account “Minority interest — other,” since those shares are not redeemable or exchangeable for Accenture Ltd Class A common shares.
3. REORGANIZATION (BENEFITS) COSTS
     In fiscal 2001, the Company accrued reorganization liabilities in connection with its transition to a corporate structure. These liabilities included certain non-income tax liabilities, such as stamp taxes, as well as liabilities for certain individual income tax exposures related to the transfer of interests in certain entities to the Company as part of the reorganization. These primarily represent unusual and disproportionate individual income tax exposures assumed by certain, but not all, of its shareholders and partners in certain tax jurisdictions specifically related to the transfer of their partnership interests in certain entities to the Company as part of the reorganization. The Company has identified certain shareholders and partners who may incur such unusual and disproportionate financial damage in certain jurisdictions. These include shareholders and partners that were subject to tax in their jurisdiction on items of income arising from the reorganization transaction that were not taxable for most other shareholders and partners. In addition, certain other shareholders and partners were subject to a different rate or amount of tax than other shareholders or partners in the same jurisdiction. If additional taxes are assessed on these shareholders or partners in connection with these transfers, the Company intends to make payments to reimburse certain of the costs associated with the assessment either to the shareholder or partner, or to the taxing authority. The Company has recorded reorganization expense and a related liability for the amount it estimates it will reimburse in situations where assessments occur. Interest accruals are made to cover interest on this liability.

8


 

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

(Unaudited)
     The Company’s reorganization activity was as follows:
                 
    Three Months Ended  
    November 30,  
    2006     2005  
Reorganization liability balance, beginning of period
  $ 350,864     $ 381,440  
Final determinations (1)
          (1,098 )
Changes in estimates
           
 
           
Benefit recorded
          (1,098 )
Interest expense accrued
    6,079       6,482  
Payments
           
 
           
Costs
    6,079       5,384  
Foreign currency translation
    8,660       (8,706 )
 
           
Reorganization liability, end of period
  $ 365,603     $ 378,118  
 
           
 
(1)   Includes final agreements with tax authorities and expirations of statutes of limitations.
     As of November 30, 2006, reorganization liabilities of $279,219 were included in Other accrued liabilities because expirations of statutes of limitations or other final determinations could occur within 12 months, and reorganization liabilities of $86,384 were included in Other non-current liabilities in the Consolidated Balance Sheet. The Company anticipates that reorganization liabilities will be substantially diminished by the end of fiscal 2008 because the Company expects final determinations will have occurred or the final statutes of limitations will have expired in a number of tax jurisdictions by the end of that year. However, tax audits or litigation may delay final settlements. Final settlement will result in a payment on a final settlement and/or recording a reorganization benefit or cost in the Company’s Consolidated Income Statement.
4. ACCUMULATED OTHER COMPREHENSIVE LOSS
     The components of Accumulated other comprehensive loss were as follows:
                 
    November 30,     August 31,  
    2006     2006  
Unrealized losses on marketable securities, net of reclassification adjustments
  $ (2,623 )   $ (3,479 )
Foreign currency translation adjustments
    30,749       9,387  
Minimum pension liability adjustments, net of tax of $22,863 and $22,863, respectively
    (32,402 )     (32,402 )
 
           
Accumulated other comprehensive loss
  $ (4,276 )   $ (26,494 )
 
           
     Comprehensive income was as follows:
                 
    November 30,
    2006   2005
Three months ended
  $ 306,450     $ 191,344  

9


 

ACCENTURE LTD
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(In thousands of U.S. dollars, except share and per share amounts or as otherwise disclosed)
(Unaudited)
5. GOODWILL
     The changes in the carrying amount of goodwill by reportable operating segment for the three months ended November 30, 2006 were as follows:
                                 
                    Foreign        
    Balance at             Currency     Balance at  
    August 31,     Additions/     Translation     November 30,  
    2006     Adjustments     Adjustments     2006  
Communications & High Tech
  $ 82,739     $ 101     $ 1,857     $ 84,697  
Financial Services
    123,592       (1,853 )     851       122,590  
Government
    33,253       (658 )     615       33,210  
Products
    258,390       (3,811 )     1,894       256,473  
Resources
    29,674       148       558       30,380  
 
                       
Total
  $ 527,648     $ (6,073 )   $ 5,775     $ 527,350  
 
                       
6. RETIREMENT PLANS
     In the United States and certain other countries, the Company maintains and administers retirement plans and postretirement medical plans for certain current, retired and resigned Accenture employees. The components of net periodic pension and postretirement expense were as follows:
                                 
    Pension Benefits  
    Three Months Ended November 30,  
    2006     2005  
Components of pension benefits expense   U.S. Plans     Non-U.S. Plans     U.S. Plans     Non-U.S. Plans  
Service cost
  $ 12,706     $ 13,327     $ 16,103     $ 12,832  
Interest cost
    13,510       6,956       12,481       5,287  
Expected return on plan assets
    (14,946 )     (6,519 )     (13,080 )     (4,865 )
Amortization of transitional obligation
          (20 )            
Amortization of loss
    325       350       7,785       466  
Amortization of prior service cost
    182       155       287       385  
 
                       
Total
  $ 11,777     $ 14,249     $ 23,576     $ 14,105  
 
                       
                                 
    Postretirement Benefits  
    Three Months Ended November 30,  
    2006     2005  
Components of postretirement benefits expense   U.S. Plans     Non-U.S. Plans     U.S. Plans     Non-U.S. Plans  
Service cost
  $ 1,666     $ 304     $ 2,524     $ 518  
Interest cost
    1,520       382       1,538       435  
Expected return on plan assets
    (375 )           (355 )      
Amortization of transitional obligation
    20             20        
Amortization of loss
          16       630       55  
Amortization of prior service cost
    (200 )     (190 )     (200 )     (72 )
 
                       
Total
  $ 2,631     $ 512     $ 4,157     $ 936  
 
                       

10


 

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

(Unaudited)
7. MATERIAL TRANSACTIONS AFFECTING SHAREHOLDERS’ EQUITY
Share Purchase Activity
     The Board of Directors of Accenture Ltd has authorized funding for its publicly announced open-market share purchase program for acquiring Accenture Ltd Class A common shares and for redemptions and repurchases of Accenture Ltd Class A common shares, Accenture SCA Class I common shares and Accenture Canada Holdings Inc. exchangeable shares held by the Company’s current and former senior executives and their permitted transferees. In addition, during the three months ended November 30, 2006, the Board of Directors of Accenture Ltd separately authorized funding for a discounted tender offer for Accenture SCA Class I common shares. The Company’s share purchase activity during the three months ended November 30, 2006 was as follows:
                 
    Shares     Amount  
Open-Market Share Purchases (1)
        $  
Discounted Tender Offer (2)
    7,538,172       187,195  
Other Share Purchase Programs:
               
Accenture SCA Class I common shares
    14,163,150       463,706  
Accenture Canada Holdings Inc. exchangeable shares
    218,319       7,085  
Accenture Ltd Class A common shares (3)
    1,979,450       48,991  
 
           
Subtotal of Other Share Purchase Programs
    16,360,919       519,782  
Other purchases (4)
    538,598       16,750  
 
           
Total
    24,437,689     $ 723,727  
 
           
 
(1)   During the three months ended November 30, 2006, the Company did not purchase any Accenture Ltd Class A common shares under this program.
 
(2)   On September 11, 2006, Accenture SCA and one of its subsidiaries made a tender offer to Accenture SCA Class I common shareholders that resulted in share redemptions and purchases, effective October 11, 2006, at a price of $24.75 per share.
 
(3)   On November 13, 2006, Accenture Finance (Gibraltar) Ltd, an indirect subsidiary of Accenture SCA, purchased Accenture Ltd Class A common shares at a price of $24.75 per share from certain former senior executives residing outside the United States.
 
(4)   During the three months ended November 30, 2006, as authorized under its various employee equity share plans, the Company acquired Accenture Ltd Class A common shares via share withholding for payroll tax obligations due from employees and former employees in connection with the delivery of Accenture Ltd Class A common shares under those plans.
     As of November 30, 2006, the Company’s available authorization was $1,400,452, which includes $978,339 and $422,113 for the open-market share purchase program and other share purchase programs, respectively.
Dividend
     On November 15, 2006, a cash dividend of $0.35 per share was paid on Accenture Ltd’s Class A common shares to shareholders of record at the close of business on October 13, 2006, resulting in a cash outlay of $204,452. On November 15, 2006, a cash dividend of $0.35 per share was also paid on Accenture SCA’s Class I common shares to shareholders of record at the close of business on October 5, 2006 and on Accenture Canada Holdings Inc. exchangeable shares to shareholders of record at the close of business on October 13, 2006, resulting in cash outlays of $87,232 and $1,375, respectively. The payment of the cash dividends also resulted in the issuance of an immaterial number of additional restricted share units to holders of restricted share units. Diluted weighted average Class A common share amounts have been restated for all periods presented to reflect this issuance.
8. COMMITMENTS AND CONTINGENCIES
Guarantees
     As a result of its increase in ownership percentage of Accenture HR Services from 50 percent to 100 percent in February 2002, the Company may be required to make up to $177,500 of additional purchase price payments through September 30, 2008, conditional on Accenture HR Services achieving certain levels of qualifying revenues. The remaining potential liability as of November 30, 2006 was $157,519.

11


 

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

(Unaudited)
     In February 2005, the Company signed an amendment to the Avanade Inc. stockholders agreement. As a result of the amendment, there is no longer a fixed purchase price minimum or maximum payable by the Company for the Avanade Inc. shares not already owned by the Company. The Company now has the right to purchase substantially all of the remaining outstanding shares of Avanade Inc. not owned by the Company at fair value if certain events occur. The Company may also be required to purchase substantially all of the remaining outstanding shares of Avanade Inc. at fair value if certain events occur.
     The Company has various agreements in which it may be obligated to indemnify other parties with respect to certain matters. Generally, these indemnification provisions are included in contracts arising in the normal course of business under which the Company customarily agrees to hold the indemnified party harmless against losses arising from a breach of representations related to such matters as title to assets sold, licensed or certain intellectual property rights and other matters. Payments by the Company under such indemnification clauses are generally conditioned on the other party making a claim. Such claims are typically subject to challenge by the Company and to dispute resolution procedures specified in the particular contract. Further, the Company’s obligations under these agreements may be limited in terms of time and/or amount and, in some instances, the Company may have recourse against third parties for certain payments made by the Company. It is not possible to predict the maximum potential amount of future payments under these indemnification agreements due to the conditional nature of the Company’s obligations and the unique facts of each particular agreement. Historically, the Company has not made any payments under these agreements that have been material individually or in the aggregate. As of November 30, 2006, management was not aware of any obligations arising under indemnification contracts that would require material payments.
     From time to time, the Company enters into contracts with clients whereby it has joint and several liability with other participants and/or third parties providing related services and products to clients. Under these arrangements, the Company and other parties may assume some responsibility to the client or a third party for the performance of others under the terms and conditions of the contract with or for the benefit of the client or in relation to the performance of certain contractual obligations. In some arrangements, the extent of the Company’s obligations for the performance of others is not expressly specified. As of November 30, 2006, the Company estimates it had assumed an aggregate potential liability of approximately $1,460,580 to its clients for the performance of others under arrangements described in this paragraph. These contracts typically provide recourse provisions that would allow the Company to recover from the other parties all but approximately $146,675 if the Company is obligated to make payments to the clients that are the consequence of a performance default by the other parties. To date, the Company has not been required to make any payments under any of the contracts described in this paragraph.
The NHS Contracts
     The Company previously entered into certain large, long-term contracts (the “NHS Contracts”) under which the Company was engaged by the National Health Service in England (the “NHS”) to design, develop and deploy new patient administration, assessment and care systems for local healthcare providers and, subsequently, to provide ongoing operational services (the “Operational Services”) once these systems were deployed. On September 28, 2006, the Company entered into a tripartite agreement (the “NHS Transfer Agreement”) with the NHS and Computer Sciences Corporation (“CSC”), an unrelated third party, under which the Company agreed to transfer to CSC all of its rights and obligations under the NHS Contracts, except those relating to the Picture Archiving Communication System. The Company expects to substantially complete the transfer during the second quarter of fiscal 2007.
     In connection with the transition and wind-down of Operational Services work related to the NHS Transfer Agreement, the Company expects losses not to exceed $125,000 in fiscal 2007. On October 4, 2006, the Company remitted approximately $50,000 in settlement of liabilities in connection with the NHS Transfer Agreement. In addition, during fiscal 2007 the Company will repay approximately $120,000 to the NHS, representing the difference between the deployment and services billings that the Company received under the NHS Contracts during their terms and the amounts the Company is entitled to retain by agreement under the NHS Transfer Agreement. This amount was recorded in Other accrued liabilities in the Consolidated Balance Sheet as of November 30, 2006. The Company’s remaining obligations under the NHS Contracts are immaterial.
Legal Contingencies
     As of November 30, 2006, the Company or its present personnel had been named as a defendant in various litigation matters. Based on the present status of these litigation matters, the management of the Company believes these matters will not ultimately have a material effect on the results of operations, financial position or cash flows of the Company.

12


 

ACCENTURE LTD
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)
(In thousands of U.S. dollars, except share and per share amounts or as otherwise disclosed)
(Unaudited)
9. SEGMENT REPORTING
     Operating segments are defined by SFAS No. 131, “Disclosures about Segments of an Enterprise and Related Information” (“SFAS No. 131”), as components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision maker, or decision-making group, in deciding how to allocate resources and in assessing performance.
     The Company’s chief operating decision maker is its Chief Executive Officer. The Company’s operating segments are managed separately because each operating segment represents a strategic business unit providing management consulting, technology and outsourcing services to clients in different industries.
     The Company’s reportable operating segments are the five operating groups, which are Communications & High Tech, Financial Services, Government, Products and Resources. Information regarding the Company’s reportable operating segments was as follows:
                                 
    Three Months Ended November 30,  
    2006     2005  
    Revenues Before     Operating     Revenues Before     Operating  
    Reimbursements     Income     Reimbursements     Income  
Communications & High Tech
  $ 1,096,390     $ 134,401     $ 1,047,541     $ 172,306  
Financial Services
    1,067,247       133,892       854,872       81,603  
Government
    627,828       28,362       598,119       61,622  
Products
    1,194,668       207,079       1,017,035       117,733  
Resources
    762,990       105,858       650,286       79,292  
Other
    4,965             1,622        
 
                       
Total
  $ 4,754,088     $ 609,592     $ 4,169,475     $ 512,556  
 
                       
10. NEWLY ISSUED ACCOUNTING STANDARDS
     In July 2006, the Financial Accounting Standards Board (“FASB”) issued Financial Interpretation No. 48, “Accounting for Uncertainty in Income Taxes-an interpretation of FASB Statement No. 109” (“FIN 48”), which is a change in accounting for income taxes. FIN 48 specifies how tax benefits for uncertain tax positions are to be recognized, measured, and derecognized in financial statements; requires certain disclosures of uncertain tax matters; specifies how reserves for uncertain tax positions should be classified in the balance sheet; and provides transition and interim-period guidance, among other provisions. FIN 48 is effective for fiscal years beginning after December 15, 2006 and, as a result, is effective for the Company beginning September 1, 2007. The Company is currently evaluating the impact of FIN 48 on its Consolidated Financial Statements.
     In September 2006, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 158, “Employers’ Accounting for Defined Benefit Pension and Other Postretirement Plans, an amendment of FASB Statements No. 87, 106, and 132(R)” (“SFAS No. 158”). SFAS No. 158 requires companies to recognize a net liability or asset and an offsetting adjustment to accumulated other comprehensive income to report the funded status of defined benefit pension and other postretirement benefit plans. SFAS No. 158 requires prospective application, recognition and disclosure requirements effective for the Company’s fiscal year ending August 31, 2007. Additionally, SFAS No. 158 requires companies to measure plan assets and obligations at their year-end balance sheet date. This requirement is effective for the Company’s fiscal year ending August 31, 2009. The Company is currently evaluating the impact of SFAS No. 158; however, the Company does not expect that it will have a material impact on its Consolidated Financial Statements.
     In September 2006, the SEC issued Staff Accounting Bulletin (“SAB”) No. 108, “Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements” (“SAB No. 108”). SAB No. 108 provides guidance on the consideration of the effects of prior year misstatements in quantifying current year misstatements for the purpose of a materiality assessment. SAB No. 108 is effective for fiscal years ending after November 15, 2006 and, as a result, is effective for the Company’s fiscal year ending August 31, 2007. The Company is currently evaluating the impact of SAB No. 108 on its Consolidated Financial Statements.
 

13


 

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, 2006, 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, 2006.
     We use the terms “Accenture,” “we,” “our Company,” “our” and “us” in this report to refer to Accenture Ltd and its subsidiaries. All references to years, unless otherwise noted, refer to our fiscal year, which ends on August 31. For example, a reference to “fiscal 2006” or “fiscal year 2006” means the 12-month period that ended on August 31, 2006. All references to quarters, unless otherwise noted, refer to the quarters of our fiscal year.
Disclosure Regarding Forward-Looking Statements
     This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934 (the “Exchange Act”) relating to our operations, results of operations and other matters that are based on our current expectations, estimates and projections. Words such as “expects,” “intends,” “plans,” “projects,” “believes,” “estimates” and similar expressions are used to identify these forward-looking statements. These statements are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict. Forward-looking statements are based upon assumptions as to future events that may not prove to be accurate. Actual outcomes and results may differ materially from what is expressed or forecast in these forward-looking statements. The reasons for these differences include changes in general economic and political conditions, including fluctuations in currency exchange rates, and the following factors:
    Our results of operations could be negatively affected if we cannot expand and develop our services and solutions in response to changes in technology and client demand.
 
    The consulting, systems integration and technology, and outsourcing markets are highly competitive, and we might not be able to compete effectively.
 
    Our results of operations could be affected by economic and political conditions and the effects of these conditions on our clients’ businesses and levels of business activity.
 
    Our work with government clients exposes us to additional risks inherent in the government contracting process.
 
    Our business could be adversely affected if our clients are not satisfied with our services.
 
    Our business could be negatively affected if we incur legal liability in connection with providing our solutions and services.
 
    Our results of operations could be adversely affected if our clients terminate their contracts with us on short notice.
 
    Outsourcing services are a significant part of our business and subject us to operational and financial risk.
 
    We could be subject to liabilities if our subcontractors or the third parties with whom we partner cannot deliver their project contributions on time or at all.
 
    Our results from operations may be affected by the rate of growth in the use of technology in business and the type and level of technology spending by our clients.
 
    Our profitability could suffer if we are not able to maintain favorable pricing rates.
 
    Our profitability could suffer if we are not able to maintain favorable utilization rates.
 
    If our pricing structures do not accurately anticipate the cost and complexity of performing our work, then our contracts could be unprofitable.

14


 

    Many of our contracts utilize performance pricing that links some of our fees to the attainment of various performance or business targets. This could increase the variability of our revenues and margins.
 
    Our alliance relationships may not be successful.
 
    Our global operations are subject to complex risks, some of which might be beyond our control.
 
    Our profitability could suffer if we are not able to control our costs.
 
    If we are unable to attract, retain and motivate employees or efficiently utilize their skills, we might not be able to compete effectively and will not be able to grow our business.
 
    If we are unable to collect our receivables or amounts extended to our clients as financing, our results of operations could be adversely affected.
 
    Tax legislation and negative publicity related to Bermuda companies could lead to an increase in our tax burden or affect our relationships with our clients.
 
    Our services or solutions could infringe upon the intellectual property rights of others or we might lose our ability to utilize the intellectual property of others.
 
    We have only a limited ability to protect our intellectual property rights, which are important to our success.
 
    If we are unable to manage the organizational challenges associated with the size and expansion of our company, we might be unable to achieve our business objectives.
 
    We might acquire other businesses or technologies, and there is a risk that we might not successfully integrate them with our business or might otherwise fail to achieve our strategic objectives.
 
    The share price of Accenture Ltd Class A common shares could be adversely affected from time to time by sales, or the anticipation of future sales, of Class A common shares held by our employees and former employees.
 
    Our share price has fluctuated in the past and could continue to fluctuate, including in response to variability in revenues, operating results and profitability, and as a result our share price could be difficult to predict.
 
    Our share price could be adversely affected if we are unable to maintain effective internal controls.
 
    We are registered in Bermuda and a significant portion of our assets are located outside the United States. As a result, it might not be possible for shareholders to enforce civil liability provisions of the Federal or state securities laws of the United States.
 
    Bermuda law differs from the laws in effect in the United States and might afford less protection to shareholders.
 
    We might be unable to access additional capital on favorable terms or at all. If we raise equity capital, it may dilute our shareholders’ ownership interest in us.
     For a more detailed discussion of these factors, see the information under the heading “Risk Factors” in our Annual Report on Form 10-K for the year ended August 31, 2006. We undertake no obligation to update or revise any forward-looking statements.

15


 

Overview
     Revenues are driven by the ability of our executives to secure new contracts and to deliver solutions and services that add value to our clients. Our ability to add value to clients and therefore drive revenues depends in part on our ability to deliver market-leading service offerings and to deploy skilled teams of professionals quickly and on a global basis.
     Our results of operations are also affected by the economic conditions, levels of business activity and rates of change in the industries we serve, as well as by the pace of technological change and the type and level of technology spending by our clients. The ability to identify and capitalize on these market and technological changes early in their cycles is a key driver of our performance. The current economic environment continues to stimulate the technology spending of many companies. We are also continuing to see strong demand for our services. We continue to expect that revenue growth rates across our segments may vary from quarter to quarter during fiscal 2007 as economic conditions vary in different industries and geographic markets.
     Revenues before reimbursements for the three months ended November 30, 2006 were $4.75 billion, compared with $4.17 billion for the three months ended November 30, 2005, an increase of 14% in U.S. dollars and 11% in local currency terms.
     Consulting revenues before reimbursements for the three months ended November 30, 2006 were $2.91 billion, compared with $2.58 billion for the three months ended November 30, 2005, an increase of 13% in U.S. dollars and 10% in local currency terms.
     Outsourcing revenues before reimbursements for the three months ended November 30, 2006 were $1.84 billion, compared with $1.59 billion for the three months ended November 30, 2005, an increase of 16% in U.S. dollars and 13% in local currency terms. Outsourcing contracts typically have longer terms than consulting contracts and generally have lower gross margins than consulting contracts, particularly in the first year. Long-term relationships with many of our clients continue to contribute to our success in growing our outsourcing business. Long-term, complex outsourcing contracts, including their consulting components, require ongoing review of their terms and scope of work, in light of our clients’ evolving business needs and our performance expectations. Should the size or number of modifications to these arrangements increase, as our business continues to grow and these contracts evolve, we may experience increased variability in expected cash flows, revenues and profitability.
     As we are a global company, our revenues are denominated in multiple currencies and may be significantly affected by currency exchange-rate fluctuations. During the majority of fiscal 2006, the weakening of various currencies versus the U.S. dollar resulted in an unfavorable currency translation and decreased our reported revenues, operating expenses and operating income. In the fourth quarter of fiscal 2006 and the first quarter of fiscal 2007, the U.S. dollar weakened against other currencies, resulting in favorable currency translation and greater reported U.S. dollar revenues, operating expenses and operating income, compared to the same period in the prior year. If this trend continues in the remainder of fiscal 2007, our U.S. dollar revenue growth may be higher than our growth in local currency terms. If the U.S. dollar strengthens against other currencies in the remainder of fiscal 2007, our U.S. dollar revenue growth may be lower than our growth in local currency.
     The primary categories of operating expenses include cost of services, sales and marketing and general and administrative costs. Cost of services is primarily driven by the cost of client-service personnel, which consists mainly of compensation, sub-contractor and other personnel costs, and non-payroll outsourcing costs. Cost of services as a percentage of revenues is driven by the prices we obtain for our solutions and services, the utilization of our client-service workforces and the level of non-payroll costs associated with the growth of new outsourcing contracts. Utilization represents the percentage of our professionals’ time spent on billable work. Sales and marketing expense is driven primarily by business-development activities, the development of new service offerings, the level of concentration of clients in a particular industry or market and client-targeting, image-development and brand-recognition activities. General and administrative costs primarily include costs for non-client-facing personnel, information systems and office space, which we seek to manage at levels consistent with changes in activity levels in our business. Operating expenses also include reorganization benefits and costs, which may vary substantially from year to year.
     Gross margin (revenues before reimbursements less cost of services before reimbursements as a percentage of revenues before reimbursements) for the three months ended November 30, 2006 was 30.1%, compared with 31.7% for the three months ended November 30, 2005. The decrease in gross margin for the three months ended November 30, 2006 was principally due to higher annual bonus accruals.

16


 

     Our cost-management strategy is to anticipate changes in demand for our services and to identify cost-management initiatives. A primary element of this strategy is to aggressively plan and manage our payroll costs to meet the anticipated demand for our services, given that payroll costs are the most significant portion of our operating expenses.
     Annualized attrition in the first quarter of fiscal 2007 was 19%, excluding involuntary terminations, up slightly from the fourth quarter of fiscal 2006, but consistent with historical attrition rates. We continue to add substantial numbers of new employees and will continue to actively recruit new employees to balance our mix of skills and resources to meet current and projected future demands, replace departing employees and expand our global sourcing approach, which includes our network of delivery centers and other capabilities around the world. We have adjusted and may need to continue to adjust compensation during the remainder of fiscal 2007 in certain industry segments, skill sets and geographies in order to attract and retain appropriate numbers of qualified employees. Our margins and ability to grow our business could be adversely affected if we do not continue to manage attrition and if we do not effectively utilize and assimilate substantial numbers of new employees into our workforces.
     Sales and marketing and general and administrative costs as a percentage of revenues before reimbursements were 17% for the three months ended November 30, 2006, compared with 19% for the three months ended November 30, 2005. The decrease in these costs as a percentage of revenues before reimbursements was primarily due to strong revenue growth and our ability to maintain sales and marketing and general and administrative costs at a consistent level when compared with the prior year.
     Operating income as a percentage of revenues before reimbursements increased to 12.8% for the three months ended November 30, 2006, from 12.3% for the three months ended November 30, 2005. The increase in operating income as a percentage of revenues before reimbursements for the three months ended November 30, 2006 was principally due to higher utilization and our ability to maintain sales and marketing and general and administrative costs at a consistent level when compared with the prior year.
The NHS Contracts
     We previously entered into certain large, long-term contracts (the “NHS Contracts”) under which we were engaged by the National Health Service in England (the “NHS”) to design, develop and deploy new patient administration, assessment and care systems for local healthcare providers and, subsequently, to provide ongoing operational services (the “Operational Services”) once these systems were deployed. On September 28, 2006, we entered into a tripartite agreement (“the NHS Transfer Agreement”) with the NHS and Computer Sciences Corporation (“CSC”), an unrelated third party, under which we agreed to transfer to CSC all of our rights and obligations under the NHS Contracts, except those relating to the Picture Archiving Communication System. We expect to substantially complete the transfer during the second quarter of fiscal 2007.
     In connection with the transition and wind-down of Operational Services work related to the NHS Transfer Agreement, we continue to believe that losses will not exceed $125 million in fiscal 2007. On October 4, 2006, we remitted approximately $50 million in settlement of liabilities in connection with the NHS Transfer Agreement. In addition, during fiscal 2007 we will repay approximately $120 million to the NHS, representing the difference between the deployment and services billings that we received under the NHS Contracts during their terms and the amounts we are entitled to retain by agreement under the NHS Transfer Agreement. This amount was recorded in Other accrued liabilities in the Consolidated Balance Sheet as of November 30, 2006. Our remaining obligations under the NHS Contracts are immaterial.
Bookings and Backlog
     New contract bookings for the three months ended November 30, 2006 were $5,479 million, a decrease of $62 million, or 1%, from the three months ended November 30, 2005, with consulting bookings increasing 6%, to $2,955 million, and outsourcing bookings decreasing 9%, to $2,524 million. The average size of our outsourcing contract new bookings has decreased when compared to outsourcing contract bookings for the three months ended November 30, 2005.
     We provide information regarding our new contract bookings because we believe doing so provides useful trend information regarding changes in the volume of our new business over time. However, the timing of large new contract bookings can significantly affect the level of bookings in a particular quarter. Information regarding our new bookings is not comparable to, nor should it be substituted for, an analysis of our revenues over time. There are no third-party standards or requirements governing the calculation of bookings. New contract bookings involve estimates and judgments regarding new contracts as well as renewals, extensions and additions to existing contracts. Subsequent cancellations, extensions and other matters may affect the amount of bookings previously reported. New contract bookings are recorded using then existing currency exchange rates and are not subsequently adjusted for currency fluctuations.

17


 

     The majority of our contracts are terminable by the client on short notice or without notice. Accordingly, we do not believe it is appropriate to characterize bookings attributable to these contracts as backlog. Normally, if a client terminates a project, the client remains obligated to pay for commitments we have made to third parties in connection with the project, services performed and reimbursable expenses incurred by us through the date of termination.
Critical Accounting Policies and Estimates
     For a description of our critical accounting policies and estimates, see our Annual Report on Form 10-K for the year ended August 31, 2006.
Revenues by Segment/Operating Group
     Our five reportable operating segments are our operating groups, which are Communications & High Tech, Financial Services, Government, Products and Resources. Operating groups are managed on the basis of revenues before reimbursements because our management believes revenues before reimbursements are a better indicator of operating group performance than revenues. From time to time, our operating groups work together to sell and implement certain contracts. The resulting revenues and costs from these contracts may be apportioned among the participating operating groups. Generally, operating expenses for each operating group have similar characteristics and are subject to the same factors, pressures and challenges. However, the economic environment and its effects on the industries served by our operating groups affect revenues and operating expenses within our operating groups to differing degrees. Decisions relating to staffing levels are not made uniformly across our operating segments, due in part to the needs of our operating groups to tailor their workforces to meet the specific needs of their businesses. The shift in mix toward outsourcing contracts is not uniform among our operating groups and, consequently, neither is the impact on operating group results caused by this shift. Local currency fluctuations also tend to affect our operating groups differently, depending on the geographic concentrations and locations of their businesses.

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     Revenues for each of our operating groups, geographic regions and types of work were as follows:
                                                 
                                    Percent of Total  
                                    Revenues Before  
    Three Months Ended             Percent     Reimbursements for the  
    November 30,             Increase     Three Months Ended  
    2006     2005     Percent     Local     November 30,  
    (in millions)     Increase US$     Currency     2006     2005  
OPERATING GROUPS
                                               
Communications & High Tech
  $ 1,096     $ 1,047       5 %     2 %     23 %     25 %
Financial Services
    1,067       855       25       21       23       21  
Government
    628       598       5       4       13       14  
Products
    1,195       1,017       17       14       25       24  
Resources
    763       650       17       14       16       16  
Other
    5       2       n/m       n/m              
 
                                       
TOTAL Revenues Before Reimbursements
    4,754       4,169       14 %     11 %     100 %     100 %
 
                                           
Reimbursements
    412       374       10                          
 
                                       
TOTAL REVENUES
  $ 5,166     $ 4,543       14 %                        
 
                                           
GEOGRAPHY
                                               
Americas
  $ 2,090     $ 1,855       13 %     12 %     44 %     45 %
EMEA (1)
    2,303       2,011       15       9       48       48  
Asia Pacific
    361       303       19       19       8       7  
 
                                       
TOTAL Revenues Before Reimbursements
  $ 4,754     $ 4,169       14 %     11 %     100 %     100 %
 
                                       
TYPE OF WORK
                                               
Consulting
  $ 2,909     $ 2,576       13 %     10 %     61 %     62 %
Outsourcing
    1,845       1,593       16       13       39       38  
 
                                       
TOTAL Revenues Before Reimbursements
  $ 4,754     $ 4,169       14 %     11 %     100 %     100 %
 
                                       
 
n/m = not meaningful
 
(1)   EMEA includes Europe, the Middle East and Africa.
Three Months Ended November 30, 2006 Compared to Three Months Ended November 30, 2005
  Revenues
     Our Communications & High Tech operating group achieved revenues before reimbursements of $1,096 million for the three months ended November 30, 2006, compared with $1,047 million for the three months ended November 30, 2005, an increase of 5% in U.S. dollars and 2% in local currency terms, with outsourcing growth across all regions and consulting growth in our Asia Pacific region. The increase was principally driven by strong growth in our Electronics & High Tech industry group in our EMEA region and in our Media & Entertainment industry group across all geographic regions. This growth was tempered by flat results in our Communications industry group when compared to the same period in fiscal 2006.
     Our Financial Services operating group achieved revenues before reimbursements of $1,067 million for the three months ended November 30, 2006, compared with $855 million for the three months ended November 30, 2005, an increase of 25% in U.S. dollars and 21% in local currency terms, with both consulting and outsourcing contributing to the revenue growth. The increase was principally driven by strong growth in our Banking industry group in our EMEA region, our Capital Markets industry group in our Americas region and our Insurance industry group across all geographic regions.
     Our Government operating group achieved revenues before reimbursements of $628 million for the three months ended November 30, 2006, compared with $598 million for the three months ended November 30, 2005, an increase of 5% in U.S. dollars and 4% in local currency terms. The increase was primarily driven by consulting growth in our Americas and EMEA regions and outsourcing growth in our Asia Pacific region.

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     Our Products operating group achieved revenues before reimbursements of $1,195 million for the three months ended November 30, 2006, compared with $1,017 million for the three months ended November 30, 2005, an increase of 17% in U.S. dollars and 14% in local currency terms, with both consulting and outsourcing contributing to the revenue growth. The increase was primarily driven by strong growth in our Americas region, principally in our Retail, Health & Life Sciences and Consumer Goods & Services industry groups, and in our EMEA region, principally in our Consumer Goods & Services, Health & Life Sciences and Industrial Equipment industry groups. These increases more than offset an expected revenue decline in our Retail industry group in our EMEA region.
     Our Resources operating group achieved revenues before reimbursements of $763 million for the three months ended November 30, 2006, compared with $650 million for the three months ended November 30, 2005, an increase of 17% in U.S. dollars and 14% in local currency terms, with strong consulting revenue growth across all geographic regions. We experienced strong revenue growth across all four industry groups: Energy, Utilities, Natural Resources and Chemicals.
     Our Americas region achieved revenues before reimbursements for the three months ended November 30, 2006 of $2,090 million, compared with $1,855 million for the three months ended November 30, 2005, an increase of 13% in U.S. dollars and 12% in local currency terms. Growth was principally driven by our business in the United States, Canada and Brazil.
     Our EMEA region achieved revenues before reimbursements for the three months ended November 30, 2006 of $2,303 million, compared with $2,011 million for the three months ended November 30, 2005, an increase of 15% in U.S. dollars and 9% in local currency terms. Growth was driven principally by our business in Spain, the Netherlands, Italy, Germany, Ireland and France.
     Our Asia Pacific region achieved revenues before reimbursements for the three months ended November 30, 2006 of $361 million, compared with $303 million for the three months ended November 30, 2005, an increase of 19% in both U.S. dollars and local currency terms. Growth was principally driven by our business in Australia and Japan.
  Operating Expenses
     Operating expenses for the three months ended November 30, 2006 were $4,557 million, an increase of $526 million, or 13%, over the three months ended November 30, 2005, and decreased as a percentage of revenues to 88% from 89% during this period. Operating expenses before reimbursable expenses for the three months ended November 30, 2006 was $4,144 million, an increase of $488 million, or 13%, over the three months ended November 30, 2005, and decreased as a percentage of revenues before reimbursements to 87% from 88% over this period.
  Cost of Services
     Cost of services for the three months ended November 30, 2006 was $3,734 million, an increase of $511 million, or 16%, over the three months ended November 30, 2005, and increased as a percentage of revenues to 72% from 71% over this period. Cost of services before reimbursable expenses for the three months ended November 30, 2006 was $3,322 million, an increase of $473 million, or 17%, over the three months ended November 30, 2005, and increased as a percentage of revenues before reimbursements to 70% from 68% over this period. Gross margin (revenues before reimbursements less cost of services before reimbursements as a percentage of revenues before reimbursements) decreased to 30.1% from 31.7% during this period. The increase in costs of services and the decrease in gross margin was principally due to higher annual bonus accruals.
  Sales and Marketing
     Sales and marketing expense for the three months ended November 30, 2006 was $437 million, an increase of $28 million, or 7%, over the three months ended November 30, 2005, and decreased as a percentage of revenues before reimbursements to 9% from 10% over this period. This decrease is primarily due to lower payroll costs, resulting from higher utilization of our client-services workforce on contracts when compared to the same period in fiscal 2006.
  General and Administrative Costs
     General and administrative costs for the three months ended November 30, 2006 were $380 million, a decrease of $14 million, or 4%, from the three months ended November 30, 2005, and decreased as a percentage of revenues before reimbursements to 8% from 9% during this period. The decrease is primarily due to lower spending on facilities and technology costs.

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  Operating Income
     Operating income for the three months ended November 30, 2006 was $610 million, an increase of $97 million, or 19%, from the three months ended November 30, 2005, and increased as a percentage of revenues before reimbursements to 13% from 12% over this period. Operating income for each of the operating groups was as follows:
                         
    Three Months Ended November 30,  
                    Increase  
    2006     2005     (Decrease)  
    (in millions)  
Communications & High Tech
  $ 135     $ 172     $ (37 )
Financial Services
    134       82       52  
Government
    28       62       (34 )
Products
    207       118       89  
Resources
    106       79       27  
 
                 
Total
  $ 610     $ 513     $ 97  
 
                 
     Operating income commentary by operating group is as follows:
    Communications & High Tech operating income decreased due to higher combined sales and marketing and general and administrative costs, partially offset by consulting revenue growth and improved contract margins in our Asia Pacific region.
 
    Financial Services operating income increase was driven by strong revenue growth, higher utilization, improved delivery efficiencies compared to the three months ended November 30, 2005 and lower combined sales and marketing and general and administrative costs as a percentage of revenues before reimbursements.
 
    Government operating income decreased due primarily to asset impairments associated with an outsourcing contract, partially offset by consulting revenue growth and improved consulting contract margins.
 
    Products operating income increase was driven by strong revenue growth, improved contract margins and lower combined sales and marketing and general and administrative costs as a percentage of revenues before reimbursements.
 
    Resources operating income increase was driven by strong revenue growth, improved contract margins and lower sales and marketing costs as a percentage of revenues before reimbursements.
  Interest Income
     Interest income for the three months ended November 30, 2006 was $36 million, an increase of $6 million, or 20%, over the three months ended November 30, 2005. The increase resulted primarily from an increase in interest rates.
  Other Expense
     Other expense for the three months ended November 30, 2006 was $2 million, a decrease of $13 million from the three months ended November 30, 2005. The decrease resulted primarily from a decrease in net foreign currency exchange losses.
  Provision for Income Taxes
     The effective tax rates for the three months ended November 30, 2006 and 2005 were 36.7% and 37.4%, respectively. We expect the fiscal 2007 annual effective tax rate to be 36.7%. The fiscal 2006 annual effective tax rate was 25.5%. The projected fiscal 2007 annual effective tax rate is higher than the fiscal 2006 annual effective tax rate primarily due to nonrecurring benefits recorded in fiscal 2006 related to final determinations of prior year tax liabilities, which reduced the fiscal 2006 annual rate by 10.8 percentage points.

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  Minority Interest
     Minority interest for the three months ended November 30, 2006 was $122 million, an increase of $9 million, or 8%, over the three months ended November 30, 2005. The increase was primarily due to an increase in income before minority interest of $78 million, partially offset by a reduction in the Accenture SCA Class I common shares and Accenture Canada Holdings Inc. exchangeable shares average ownership interest to 29% as of November 30, 2006 from 34% as of November 30, 2005.
  Earnings Per Share
     Diluted earnings per share were $0.46 for the three months ended November 30, 2006, compared with $0.36 for the three months ended November 30, 2005. For information regarding our earnings per share calculations, see Footnote 2 (Earnings Per Share) to our Consolidated Financial Statements under Item 1, “Financial Statements.”
Liquidity and Capital Resources
     Our primary sources of liquidity are cash flows from operations, debt capacity available under various credit facilities and available cash reserves. We may also be able to raise additional funds through public or private debt or equity financings in order to:
    take advantage of opportunities, including more rapid expansion;
 
    acquire complementary businesses or technologies;
 
    develop new services and solutions;
 
    respond to competitive pressures; or
 
    facilitate purchases, redemptions and exchanges of Accenture shares.
     As of November 30, 2006, cash and cash equivalents of $2,438 million combined with $407 million of liquid fixed-income securities that are classified as investments on our Consolidated Balance Sheet totaled $2,845 million, compared with $3,530 million as of August 31, 2006, a decrease of $685 million.
     Cash flows from operating, investing and financing activities, as reflected in the Consolidated Cash Flows Statements, are summarized in the following table:
                         
    Three Months Ended November 30,  
    2006     2005     Change  
    (in millions)  
Net cash provided by (used in):
                       
Operating activities
  $ 166     $ 368     $ (202 )
Investing activities
    (22 )     157       (179 )
Financing activities
    (814 )     (1,278 )     464  
Effect of exchange rate changes on cash and cash equivalents
    41       (45 )     86  
 
                 
Net decrease in cash and cash equivalents
  $ (629 )   $ (798 )   $ 169  
 
                 
     Operating Activities. The $202 million decrease in cash provided was primarily due to increases in net client balances during the first three months of fiscal 2007 compared to the first three months of fiscal 2006, partially offset by an increase in net income.
     Investing Activities. The $179 million decrease in cash provided was primarily due to an increase in purchases of marketable securities in the first three months of fiscal 2007 compared to the first three months of fiscal 2006, partially offset by an increase in proceeds from marketable securities.
     Financing Activities. The $464 million decrease in cash used was primarily driven by a significant decrease in purchases of common shares and a $48 million increase in cash received for Accenture Ltd Class A common shares issued under our employee share programs in the first three months of fiscal 2007 compared to the first three months of fiscal 2006, partially offset by a

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$25 million increase in cash dividends paid. For additional information, see Footnote 7 (Material Transactions Affecting Shareholders’ Equity) to our Consolidated Financial Statements under Item 1, “Financial Statements.”
     We believe that our available cash balances and the cash flows expected to be generated from operations will be sufficient to satisfy our current and planned working capital and investment needs for the next twelve months. We also believe that our longer-term working capital and other general corporate funding requirements will be satisfied through cash flows from operations and, to the extent necessary, from our borrowing facilities and future financial market activities.
  Borrowing Facilities
     As of November 30, 2006, we had the following borrowing facilities and related borrowings, including the issuance of letters of credit, for general working capital purposes:
                 
            Borrowings  
            Under  
    Facility Amount     Facilities  
    (in millions)  
Syndicated loan facility
  $ 1,200     $  
Separate bilateral, uncommitted, unsecured multicurrency revolving credit facilities
    350       3  
Local guaranteed and non-guaranteed lines of credit
    135        
 
           
Total
  $ 1,685     $ 3  
 
           
     Under the borrowing facilities described above, we had an aggregate of $163 million of letters of credit outstanding as of November 30, 2006. In addition, as of November 30, 2006, we had zero other short-term borrowings and total outstanding debt of $29 million, which was primarily incurred in conjunction with the purchase of Accenture HR Services.
  Client Financing
     In limited circumstances, we agree to extend financing to clients. The terms vary by contract, but generally we contractually link payment for services to the achievement of specified performance milestones. We finance these client obligations primarily with existing working capital and bank financing in the country of origin. Imputed interest is recorded at market rates in Interest income in the Consolidated Income Statement. Information pertaining to client financing was as follows:
                 
    November 30,     August 31,  
    2006     2006  
    (in millions, except number of clients)  
Number of clients
    24       25  
 
           
Client financing included in Current unbilled services
  $ 149     $ 158  
Client financing included in Non-current unbilled services
    78       105  
 
           
Total client financing, current and non-current
  $ 227     $ 263  
 
           
  Share Purchases and Redemptions
     The Board of Directors of Accenture Ltd has authorized funding for its publicly announced open-market share purchase program for acquiring Accenture Ltd Class A common shares and for redemptions and repurchases of Accenture Ltd Class A common shares, Accenture SCA Class I common shares and Accenture Canada Holdings Inc. exchangeable shares held by our current and former senior executives and their permitted transferees. In addition, during the three months ended November 30, 2006, the Board of Directors of Accenture Ltd separately authorized funding for a discounted tender offer for Accenture SCA Class I common shares. Our share purchase activity during the three months ended November 30, 2006 was as follows:

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    Shares     Amount  
          (in millions)  
Open-Market Share Purchases (1)
        $  
Discounted Tender Offer (2)
    7,538,172       187  
Other Share Purchase Programs:
               
Accenture SCA Class I common shares
    14,163,150       464  
Accenture Canada Holdings Inc. exchangeable shares
    218,319       7  
Accenture Ltd Class A common shares (3)
    1,979,450       49  
 
           
Subtotal of Other Share Purchase Programs
    16,360,919       520  
Other purchases (4)
    538,598       17  
 
           
Total
    24,437,689     $ 724  
 
           
 
(1)   During the three months ended November 30, 2006, we did not purchase any Accenture Ltd Class A common shares under this program.
 
(2)   On September 11, 2006, Accenture SCA and one of its subsidiaries made a tender offer to Accenture SCA Class I common shareholders that resulted in share redemptions and purchases, effective October 11, 2006, at a price of $24.75 per share.
 
(3)   On November 13, 2006, Accenture Finance (Gibraltar) Ltd, an indirect subsidiary of Accenture SCA, purchased Accenture Ltd Class A common shares at a price of $24.75 per share from certain former senior executives residing outside the United States.
 
(4)   During the three months ended November 30, 2006, as authorized under our various employee equity share plans, we acquired Accenture Ltd Class A common shares via share withholding for payroll tax obligations due from employees and former employees in connection with the delivery of Accenture Ltd Class A common shares under those plans.
     As of November 30, 2006, our available authorization was $1,400 million, which includes $978 million and $422 million for the open-market share purchase program and other share purchase programs, respectively.
     For a complete description of all share purchase and redemption activity for the first quarter of fiscal 2007, see Part II, Item 2, “Unregistered Sales of Equity Securities and Use of Proceeds; Issuer Purchases of Equity Securities.”
Off-Balance Sheet Arrangements
     We have various agreements by which we may be obligated to indemnify the other party with respect to certain matters. Generally, these indemnification provisions are included in contracts arising in the normal course of business under which we customarily agree to hold the indemnified party harmless against losses arising from a breach of representations related to such matters as title to assets sold, licensed or certain intellectual property rights and other matters. Payments by us under such indemnification clauses are generally conditioned on the other party making a claim. Such claims are generally subject to challenge by us and dispute resolution procedures specified in the particular contract. Furthermore, our obligations under these arrangements may be limited in terms of time and/or amount and, in some instances, we may have recourse against third parties for certain payments made by us. It is not possible to predict the maximum potential amount of future payments under these indemnification agreements due to the conditional nature of our obligations and the unique facts of each particular agreement. Historically, we have not made any payments under these agreements that have been material individually or in the aggregate. As of November 30, 2006, we were not aware of any obligations under such indemnification agreements that would require material payments.
     From time to time, we enter into contracts with clients whereby we have joint and several liability with other participants and/or third parties providing related services and products to clients. Under these arrangements, we and other parties may assume some responsibility to the client or a third party for the performance of others under the terms and conditions of the contract with or for the benefit of the client or in relation to the performance of certain contractual obligations. To date, we have not been required to make any payments under any of the contracts described in this paragraph. For further discussion of these transactions, see Footnote 8 (Commitments and Contingencies) to our Consolidated Financial Statements under Item 1, “Financial Statements.”
Newly Issued Accounting Standards
     In July 2006, the Financial Accounting Standards Board (“FASB”) issued Financial Interpretation No. 48, “Accounting for Uncertainty in Income Taxes-an interpretation of FASB Statement No. 109” (“FIN 48”), which is a change in accounting for income taxes. FIN 48 specifies how tax benefits for uncertain tax positions are to be recognized, measured and derecognized in financial statements; requires certain disclosures of uncertain tax matters; specifies how reserves for uncertain tax positions should be classified

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in the balance sheet; and provides transition and interim-period guidance, among other provisions. FIN 48 is effective for fiscal years beginning after December 15, 2006 and, as a result, is effective for us beginning September 1, 2007. We are currently evaluating the impact of FIN 48 on our Consolidated Financial Statements.
     In September 2006, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 158, “Employers’ Accounting for Defined Benefit Pension and Other Postretirement Plans, an amendment of FASB Statements No. 87, 106, and 132(R)” (“SFAS No. 158”). SFAS No. 158 requires companies to recognize a net liability or asset and an offsetting adjustment to accumulated other comprehensive income to report the funded status of defined benefit pension and other postretirement benefit plans. SFAS No. 158 requires prospective application, recognition and disclosure requirements effective for our fiscal year ending August 31, 2007. Additionally, SFAS No. 158 requires companies to measure plan assets and obligations at their year-end balance sheet date. This requirement is effective for our fiscal year ending August 31, 2009. We are currently evaluating the impact of SFAS No. 158; however, we do not expect that it will have a material impact on our Consolidated Financial Statements.
     In September 2006, the SEC issued Staff Accounting Bulletin (“SAB”) No. 108, “Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements” (“SAB No. 108”). SAB No. 108 provides guidance on the consideration of the effects of prior year misstatements in quantifying current year misstatements for the purpose of a materiality assessment. SAB No. 108 is effective for fiscal years ending after November 15, 2006 and, as a result is effective for our fiscal year ending August 31, 2007. We are currently evaluating the impact of SAB No. 108 on our Consolidated Financial Statements.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
     During the three months ended November 30, 2006, there were no material changes in our market risk exposure. For a discussion of our market risk associated with foreign currency risk, interest rate risk and equity price risk as of August 31, 2006, see “Quantitative and Qualitative Disclosures about Market Risk” in Part II, Item 7A, of Accenture Ltd’s Annual Report on Form 10-K for the year ended August 31, 2006.
ITEM 4. CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures
     Based on their evaluation for the period covered by this Quarterly Report on Form 10-Q, the Chief Executive Officer and the Chief Financial Officer of Accenture Ltd have concluded that, as of the end of such period, our disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) under the Exchange Act) are effective to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms.
Changes in Internal Control Over Financial Reporting
     There has been no change in our internal control over financial reporting that occurred during the first quarter of fiscal 2007 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

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PART II — OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
     We are involved in a number of judicial and arbitration proceedings concerning matters arising in the ordinary course of our business. We do not expect that any of these matters, individually or in the aggregate, will have a material impact on our results of operations or financial condition.
     As previously reported in July 2003, we became aware of an incident of possible noncompliance with the Foreign Corrupt Practices Act and/or with Accenture’s internal controls in connection with certain of our operations in the Middle East. In 2003, we voluntarily reported the incident to the appropriate authorities in the United States promptly after its discovery. Shortly thereafter, the SEC advised us it would be undertaking an informal investigation of this incident, and the U.S. Department of Justice indicated it would also conduct a review. Since that time, there have been no further developments. We do not believe that this incident will have any material impact on our results of operations or financial condition.
     We currently maintain the types and amounts of insurance customary in the industries and countries in which we operate, including coverage for professional liability, general liability and management liability. We consider our insurance coverage to be adequate both as to the risks and amounts for the businesses we conduct.
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, 2006. There have been no material changes to the risk factors disclosed in our Annual Report on Form 10-K for the year ended August 31, 2006.

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ITEM 2.   UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS; ISSUER PURCHASES OF EQUITY SECURITIES
Purchases and redemptions of Accenture Ltd Class A common shares and Class X common shares
     The following table provides information relating to our purchases of Accenture Ltd Class A common shares and redemptions of Accenture Ltd Class X common shares for the first quarter of fiscal 2007.
                                 
                            Approximate
                    Total Number of   Dollar Value of
                    Shares Purchased as   Shares that May Yet
                    Part of Publicly   Be Purchased Under
    Total Number of   Average Price Paid   Announced Plans or   Publicly Announced
Period   Shares Purchased   per Share   Programs (1)   Plans or Programs
                            (in millions)
September 1, 2006 — September 30, 2006
                               
Class A common shares
    303,742     $ 29.83           $ 978  
Class X common shares
    490,434     $ 0.0000225              
October 1, 2006 — October 31, 2006
                               
Class A common shares
    93,292     $ 32.33           $ 978  
Class X common shares
    14,172,192     $ 0.0000225              
November 1, 2006 — November 30, 2006
                               
Class A common shares
    2,121,014     $ 25.30           $ 978  
Class X common shares
    4,090,013     $ 0.0000225              
Total
                               
Class A common shares (1)(2)(3)
    2,518,048     $ 26.11                
Class X common shares (4)
    18,752,639     $ 0.0000225                
 
(1)   Since August 2001, the Board of Directors of Accenture Ltd has authorized and periodically confirmed a publicly announced open-market share purchase program for acquiring Accenture Ltd Class A common shares. During the first quarter of fiscal 2007, we did not purchase any Accenture Ltd Class A common shares under this program. To date, the Board of Directors of Accenture has authorized an aggregate of $2.4 billion for use in these open-market share purchases. As of November 30, 2006, an aggregate of $978 million remained available for these open-market share purchases. The open-market purchase program does not have an expiration date.
 
(2)   During the first quarter of fiscal 2007, Accenture purchased 538,598 Accenture Ltd Class A common shares in transactions unrelated to publicly announced share plans or programs. These transactions consisted of acquisitions of Accenture Ltd Class A common shares via share withholding for payroll tax obligations due from employees and former employees in connection with the delivery of Accenture Ltd Class A common shares under our various employee equity share plans.
 
(3)   During the first quarter of fiscal 2007, Accenture Finance (Gibraltar) Ltd, an indirect subsidiary of Accenture SCA, purchased Accenture Ltd Class A common shares at a price of $24.75 per share from certain former senior executives residing outside the United States.
 
(4)   During the first quarter of fiscal 2007, we redeemed 18,752,639 Accenture Ltd Class X common shares pursuant to its bye-laws. Accenture Ltd Class X common shares are redeemable at their par value of $0.0000225 per share.
Purchases and redemptions of Accenture SCA Class I common shares and Accenture Canada Holdings Inc. exchangeable shares
     The following table provides additional information relating to purchases and redemptions by Accenture of Accenture SCA Class I common shares and Accenture Canada Holdings Inc. exchangeable shares during the first quarter of fiscal 2007. Our management believes the following table and footnotes provide useful information regarding the share purchase and redemption activity of Accenture. Generally, purchases and redemptions of Accenture SCA Class I common shares and Accenture Canada Holdings Inc. exchangeable shares reduce shares outstanding for purposes of computing earnings per share.

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                            Approximate Dollar
                    Total Number of   Value of Shares
                    Shares Purchased as   that May Yet Be
                    Part of Publicly   Purchased Under
    Total Number of   Average Price Paid   Announced Plans   Publicly Announced
Period   Shares Purchased (1)   per Share   or Programs   Plans or Programs
Accenture SCA
                               
September 1, 2006 — September 30, 2006
                               
Class I common shares
                       
October 1, 2006 — October 31, 2006
                               
Class I common shares
    16,596,335     $ 28.95              
November 1, 2006 — November 30, 2006
                               
Class I common shares
    5,104,987     $ 33.40              
Total
                               
Class I common shares (2) (3)
    21,701,322     $ 29.99              
Accenture Canada Holdings Inc.
                               
September 1, 2006 — September 30, 2006
                               
Exchangeable shares
                       
October 1, 2006 — October 31, 2006
                               
Exchangeable shares
    193,365     $ 32.34              
November 1, 2006 — November 30, 2006
                               
Exchangeable shares
    24,954     $ 33.31              
Total
                               
Exchangeable shares (3)
    218,319     $ 32.45              
 
(1)   To date, the Board of Directors of Accenture Ltd has authorized an aggregate of $4.2 billion for purchases and redemptions of shares from our current and former senior executives and their permitted transferees under our Senior Executive Trading Policy and our prior Share Management Plan. As of November 30, 2006, an aggregate of $422 million remained available for these purchases and redemptions. These aggregate authorized amounts do not include an additional $650 million specifically authorized to effect the October 11, 2006 tender offer described in footnote 2 below.
 
(2)   On September 11, 2006, Accenture SCA and one of its subsidiaries made a tender offer to Accenture SCA Class I common shareholders that resulted in the redemption and purchase, effective October 11, 2006, of an aggregate of 7,538,172 Accenture SCA Class I common shares at a price of $24.75 per share. The Board of Directors of Accenture approved up to $650 million in funding for this tender offer. This transaction was unrelated to our publicly announced share plans or programs.
 
(3)   During the first quarter of fiscal 2007, Accenture redeemed and purchased a total of 14,163,150 Accenture SCA Class I common shares and 218,319 Accenture Canada Holdings Inc. exchangeable shares from current and former senior executives and their permitted transferees.
Purchases and redemptions of Accenture SCA Class II and Class III common shares
     On November 15, 2006, Accenture SCA redeemed 4,832,465 Class II common shares and 5,512,267 Accenture SCA Class III common shares from Accenture. These redemptions were made in transactions unrelated to publicly announced share plans or programs. Transactions involving Accenture SCA Class II and Class III common shares consist exclusively of inter-company transactions undertaken to facilitate other corporate purposes. These inter-company transactions do not reduce shares outstanding for purposes of computing earnings per share reflected in our Consolidated Financial Statements under Item 1, “Financial Statements.”
ITEM 3. DEFAULTS UPON SENIOR SECURITIES
     None.

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ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
     None.
ITEM 5. OTHER INFORMATION
     (a) None.
     (b) None.
ITEM 6. EXHIBITS
     Exhibit Index:
     
Exhibit    
Number   Exhibit
3.1
  Form of Bye-laws of the Registrant, effective as of February 2, 2005 (incorporated by reference to Exhibit 3.1 to the February 28, 2005 10-Q)
 
   
31.1
  Certification of the Chief Executive Officer pursuant to Rule 13a-14(a) or 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
 
   
31.2
  Certification of the Chief Financial Officer pursuant to Rule 13a-14(a) or 15d-14(a) of the Securities Exchange Act of 1934, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
 
   
32.1
  Certification of the Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
 
   
32.2
  Certification of the Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

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SIGNATURES
     Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Date: December 22, 2006
         
  ACCENTURE LTD
 
 
  By:   /s/ Pamela J. Craig    
    Name:   Pamela J. Craig   
    Title:   Chief Financial Officer   

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