UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

FORM 10-Q

OR

Commission File Number: 000-49713

ACCENTURE SCA

1 rue Guillaume Kroll
L-1882 Luxembourg
(Address of principal executive offices)

(352) 26 42 35 00
(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. Yesx No o

     Indicate by check mark whether the Registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act.) Yes x No o

     The number of shares of the Registrant’s Class I common shares, par value €1.25 per share, outstanding as of June 30, 2004 was 875,017,237 (which number does not include 96,276,217 issued shares held by the Registrant and by subsidiaries of the Registrant).

ACCENTURE SCA

INDEX

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PART I—FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS

ACCENTURE SCA

CONSOLIDATED BALANCE SHEETS

May 31, 2004 and August 31, 2003
(In thousands of U.S. dollars, except share amounts)

The accompanying notes are an integral part of these financial statements.

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ACCENTURE SCA

CONSOLIDATED INCOME STATEMENTS

For the Three and Nine Months Ended May 31, 2004 and 2003
(In thousands of U.S. dollars)
(Unaudited)

The accompanying notes are an integral part of these financial statements.

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ACCENTURE SCA

CONSOLIDATED SHAREHOLDERS’ EQUITY STATEMENT

For the Nine Months Ended May 31, 2004
(U.S. dollars and share amounts in thousands)
(Unaudited)

The accompanying notes are an integral part of these financial statements.

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ACCENTURE SCA

CONSOLIDATED CASH FLOWS STATEMENTS
For the Nine Months Ended May 31, 2004 and 2003
(In thousands of U.S. dollars)
(Unaudited)

The accompanying notes are an integral part of these financial statements.

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ACCENTURE SCA

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

1.

BASIS OF PRESENTATION

     The accompanying unaudited interim consolidated financial statements of Accenture SCA, a Luxembourg partnership limited by shares, and its controlled subsidiary companies (together “Accenture” or the “Company”) have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”) for quarterly reports on Form 10-Q and do not include all of the information and note disclosures required by accounting principles generally accepted in the United States of America for complete financial statements. These financial statements should therefore be read in conjunction with the consolidated financial statements and notes thereto for the fiscal year ended August 31, 2003 included in the Company’s Annual Report on Form 10-K filed with the SEC on November 19, 2003. The accompanying unaudited interim consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America 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 and nine months ended May 31, 2004 are not necessarily indicative of the results that may be expected for the fiscal year ending August 31, 2004. Certain prior-period amounts have been reclassified to conform to the current-period presentation.

2.

RECENTLY ADOPTED ACCOUNTING STANDARDS

     In November 2002, the Emerging Issues Task Force (“EITF”) issued a final consensus on Issue 00-21, “Accounting for Revenue Arrangements with Multiple Deliverables.” In May 2003, the EITF issued additional interpretive guidance regarding the application of Issue 00-21. Issue 00-21, which provides guidance on how and when to recognize revenues on arrangements requiring delivery of more than one product or service, is effective prospectively for arrangements entered into in fiscal periods beginning after June 15, 2003.

     Effective September 1, 2003, Accenture adopted Issue 00-21 on a prospective basis. The Company will continue to account for contracts signed on or before August 31, 2003 under the previous policy for contracts containing multiple elements, as described in the notes to the consolidated financial statements in the Company’s Annual Report on Form 10-K for the fiscal year ended August 31, 2003. Revenues related to new revenue arrangements with multiple elements signed after August 31, 2003 are allocated to each element based on the lesser of the element’s relative fair value or the amount that is not contingent on future delivery of another element.

     Revenues allocated to separate elements are recognized for each separate element in accordance with Accenture’s accounting policy for that element as described in the notes to the consolidated financial statements in the Company’s Annual Report on Form 10-K for the fiscal year ended August 31, 2003. If the amount of non-contingent revenue allocated to a delivered element is less than the costs to deliver such services, then such costs are deferred and recognized in future periods when the revenue becomes non-contingent.

     The adoption of Issue 00-21 reduced revenues by approximately $18,000 and $26,000 for the three- and nine-month periods ended May 31, 2004, respectively, and reduced operating income by approximately $17,000 and $24,000 for the corresponding periods.

3.

PRO FORMA IMPACT OF EMPLOYEE STOCK OPTIONS AND SHARE PURCHASE PLANS

     Accenture follows Accounting Principles Board Opinion No. 25 (“APB 25”), “Accounting for Stock Issued to Employees,” in accounting for its employee stock options and share purchase rights. Accordingly, no compensation expense is recognized for stock options and share purchase rights granted under the Company’s employee share incentive and employee share purchase plans. Had compensation cost for the Company’s employee share incentive and employee share purchase plans been determined based on fair value at the grant date consistent with Statement of Financial Accounting Standards (“SFAS”) No. 123, “Accounting for Stock-Based Compensation,” the Company’s net income would have been reduced to the pro forma amounts indicated below:

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ACCENTURE SCA

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

4.

INVESTMENTS

     In February 2004, the Company transferred approximately $1,400,000 of money-market mutual fund balances to managed investment accounts. All highly liquid investments purchased with an original maturity of 90 days or less are considered to be cash equivalents and are recorded at fair market value. Investments with a maturity greater than 90 days, but less than one year, at the time of purchase are considered to be short-term investments. Investments with a maturity greater than one year at the time of purchase are considered to be long-term investments. Marketable short- and long-term investments are classified and accounted for as available-for-sale. Available-for-sale investments are reported at fair value with unrealized gains and losses recorded as a separate component of Accumulated other comprehensive income (loss) in shareholders’ equity until realized. Interest and amortization of premiums and discounts for debt securities are included in interest income. Realized gains and losses on securities are determined based on the FIFO method and are included in Gain (loss) on investments, net. The Company does not hold these investments for speculative or trading purposes.

     Investments at May 31, 2004 were as follows:

     The amortized cost and estimated fair value of available-for-sale investments in debt securities at May 31, 2004, by contractual maturity, were as follows:

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ACCENTURE SCA

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

5.

GOODWILL

     A summary of the changes in the carrying amount of goodwill by segment for the nine months ended May 31, 2004 is as follows:

6.

REORGANIZATION BENEFITS/COSTS

     During the three and nine months ended May 31, 2004, Accenture recorded expense of $1,936 and a benefit of $84,280, respectively, primarily resulting from final determinations of certain reorganization liabilities established in connection with Accenture’s transition to a corporate structure in 2001. During the three and nine months ended May 31, 2003, the reorganization benefits were $570 and $14,565, respectively. The carrying amount of the reorganization liabilities was $444,534 at May 31, 2004 and $510,149 at August 31, 2003. The remaining change in the reorganization liabilities during the nine months ended May 31, 2004 was due to foreign currency translation. The reorganization liabilities are recorded as a component of Other accrued liabilities and Other non-current liabilities on the Consolidated Balance Sheet.

7.

RESTRUCTURING COSTS

     In the fourth quarter of 2002, Accenture recognized restructuring costs of $110,524 related to a global consolidation of office space. At August 31, 2003, the related liability for restructuring costs was $40,327. This liability was reduced by payments made in the three and nine months ended May 31, 2004 of $5,645 and $15,699, respectively. The liability was also affected by immaterial changes in lease estimates, imputed interest and foreign currency translation. The liability at May 31, 2004 was $27,006, representing the net present value of the estimated remaining obligations related to exiting operating leases.

     In the second quarter of 2004, Accenture management approved a real estate consolidation plan, which was substantially completed during the second quarter of fiscal 2004, primarily in the United States and the United Kingdom. Accenture recognized restructuring costs of $107,256, consisting of $89,331 to consolidate various locations and $17,925 to abandon the related fixed assets. Payments totaling $4,032 and $4,806 were made in the three and nine months ended May 31, 2004. The liability was also affected by immaterial changes in lease estimates, imputed interest and foreign currency translation. At May 31, 2004, the related liability for restructuring costs was $85,592 and was recorded as a component of Other accrued liabilities and Other non-current liabilities.

8.

ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

     The components of Comprehensive income are as follows:

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ACCENTURE SCA

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

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ACCENTURE SCA

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

     The components of Accumulated other comprehensive loss are as follows:

9.

PENSION AND OTHER POSTRETIREMENT BENEFITS

     In the United States and certain other countries, Accenture maintains and administers noncontributory retirement and postretirement medical plans for active, retired and resigned Accenture employees. The components of net periodic benefit cost for material defined benefit pension and postretirement benefit plans are as follows:

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ACCENTURE SCA

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

10.

MATERIAL TRANSACTIONS AFFECTING SHAREHOLDERS’ EQUITY

Secondary Offering

     On May 4, 2004, as part of its Share Management Plan, Accenture closed an underwritten public offering of Accenture Ltd Class A common shares. The offering was comprised of 35,761,232 such shares newly issued by Accenture Ltd and 14,238,768 of such shares offered by Accenture partners, former partners and their permitted transferees. The price to the public was $23.50 per share and the price net of the underwriters’ discount of 2.8% was $22.84. Accenture Ltd received $816,858 as the result of the issuance of 35,761,232 shares newly issued by Accenture Ltd. On May 4, 2004, the underwriters, in connection with the underwritten public offering, exercised their option to purchase an additional 7,500,000 newly issued Class A common shares at the same price per share. On May 4, 2004, Accenture Ltd received $171,315 as a result of the issuance of the additional 7,500,000 newly issued shares. Accenture Ltd remitted proceeds from the offering to Accenture SCA in exchange for Accenture SCA Class I common shares. As a result of these transactions, Accenture Ltd’s ownership interest in Accenture SCA increased from 55% to 57%. All proceeds from the secondary offering that concluded on May 4, 2004, and exercise of the related underwriters’ option, as well as $56,661 of the $600,000 previously authorized for acquisitions from partners, former partners and their permitted transferees, were used to redeem or purchase Accenture SCA Class I common shares and Accenture Canada Holdings Inc. exchangeable shares on June 3, 2004. For further discussion on the Accenture SCA tender offer see “Subsequent Event” section below.

Subsequent Event

     On June 3, 2004, Accenture SCA and one of its controlled subsidiaries redeemed or purchased an aggregate of 45,087,451 Accenture SCA Class I common shares at a price of $23.50 per share less transaction fees as a result of a tender offer made to Accenture SCA Class I shareholders on April 29, 2004. At the same time, a subsidiary of Accenture SCA purchased 654,344 Accenture Canada Holdings Inc. exchangeable shares at a price of $23.50 per share less transaction fees. The total cash outlay for these transactions was $1,074,932. As a result of this transaction, Accenture Ltd’s ownership interest in Accenture SCA increased from 57% to 60%.

Accenture Stock Employee Compensation Trust

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ACCENTURE SCA

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

     On December 19, 2003, the Accenture Stock Employee Compensation Trust was terminated. A subsidiary of Accenture Ltd that is not a subsidiary of Accenture SCA created a new Share Employee Compensation Trust (“SECT”). Substantially all treasury shares purchased by the predecessor trust that had not been used to fund employee share awards were transferred to the new SECT.

     In a series of open-market purchases during the three and nine months ended May 31, 2004, the SECT and its predecessor trust acquired 1,800,000 and 7,113,050 Accenture Ltd Class A common shares, respectively, at aggregate purchase prices of $44,448 and $165,915, respectively, for use in conjunction with employee equity awards. At May 31, 2004, the SECT had $66,213 of previously authorized contributions available for share purchases.

11.

ANDERSEN CONTRACTS

     In October 2002, Accenture and Arthur Andersen LLP terminated the prior training facility services agreement, as well as the services agreements by which Arthur Andersen LLP and other Arthur Andersen firms were to provide services to Accenture and by which Accenture was to provide Arthur Andersen LLP and other Arthur Andersen firms with services. In conjunction with the termination of all contracts and in settlement of all related matters with Arthur Andersen LLP and other Arthur Andersen firms, Accenture paid Arthur Andersen LLP $190,290. This payment offset previously accrued amounts and resulted in an immaterial gain.

12.

GUARANTEES

     As a result of Accenture increasing its ownership percentage of Accenture HR Services from 50 percent to 100 percent in February 2002, Accenture may be required to make payments totaling up to $187,500 in additional purchase price over a five-year period starting February 28, 2002, conditional on Accenture HR Services achieving certain levels of qualifying revenues. During the three and nine months ended May 31, 2004, Accenture made payments totaling $0 and $1,720, respectively. The remaining potential liability at May 31, 2004 was $185,780.

     In connection with Accenture increasing its ownership interest in Avanade, Inc. from 50 percent to 78 percent in December 2001, Accenture has the right to purchase substantially all of the remaining outstanding shares of Avanade, Inc. not owned by Accenture at fair market value but not less than $28,650 and not to exceed $58,650 anytime after December 31, 2004 or earlier if certain events occur. Accenture may also be required to purchase substantially all of the remaining outstanding shares of Avanade, Inc. not owned by Accenture anytime after December 31, 2006, or earlier if certain events occur, for fair market value but not less than $28,650 and not to exceed $58,650.

     Accenture has various agreements in which it 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 the Company customarily agrees to hold the other party harmless against losses arising from a breach of representations related to such matters as title to assets sold and licensed or certain intellectual property rights. Payments by Accenture under such indemnification clauses are generally conditioned on the other party making a claim. Such claims are typically subject to challenge by Accenture 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, Accenture 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 Accenture’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 May 31, 2004, management was not aware of any obligations arising under indemnification agreements that would require material payments.

     From time to time, Accenture enters into contracts with clients whereby it has joint and several liability with other participants and third parties providing related services and products to clients. Under these arrangements, Accenture and other parties may assume some responsibility to the client for the performance of others under the terms and conditions of the contract with or for the benefit of the client. In some arrangements, the extent of Accenture’s obligations for the performance

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ACCENTURE SCA

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

of others is not expressly specified. As of May 31, 2004, Accenture estimates it had assumed an aggregate potential liability of approximately $404,413 to its clients for the performance of others under arrangements described in this paragraph. These contracts typically provide recourse provisions that would allow Accenture to recover from the other parties all but approximately $39,593 if Accenture is obligated to make payments to the clients that are the consequence of a performance default by the other parties. In some of these contracts, the guarantee is contractually given to the client by one of the other parties providing services to the client. In the event of Accenture’s performance default, Accenture could be responsible for repayment to the other party. To date, Accenture has not been required to make any payments under any of the contracts described in this paragraph, and we believe that if we were to incur a loss in the future in connection with any one of these arrangements, such a loss should not have a material effect on Accenture’s financial condition or results of operations.

13.

SEGMENT REPORTING

     Operating segments are defined by SFAS No. 131, “Disclosures about Segments of an Enterprise and Related Information,” 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.

     Accenture’s chief operating decision maker is the chief executive officer. The operating segments are managed separately because each operating segment represents a strategic business unit that serves clients in different industries. The reportable operating segments are the Company’s five operating groups, which are Communications & High Tech, Financial Services, Government, Products and Resources.

     Financial information for the Company’s reportable segments is as follows:

     Reorganization costs for the three months ended May 31, 2004 were $1,936 while restructuring costs, net of a reorganization benefit, totaled $22,976 for the nine months ended May 31, 2004. For the three and nine months ended May 31, 2003, the reorganization benefits were $570 and $14,565, respectively. These amounts were allocated to the operating groups, affecting their operating income by the following amounts:

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ACCENTURE SCA

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

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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 fiscal year ended August 31, 2003, 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 fiscal year ended August 31, 2003.

     We use the terms “Accenture,” “the Company,” “we,” “our,” and “us” in this report to refer to Accenture SCA 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 “2003” or “fiscal year 2003” means the 12-month period that ended on August 31, 2003. All references to quarters, unless otherwise noted, refer to the quarters of our fiscal year. We use the term “partner” to refer to the executive employees of Accenture with the “partner” title.

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 and Section 21E of 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 this include changes in general economic and political conditions, including fluctuations in exchange rates, and the following factors:

•		Our results of operations are materially affected by economic conditions, levels of business activity and rates of change in the industries we serve.
•		Our business will be negatively affected if we are not able to anticipate and keep pace with rapid changes in technology or if growth in the use of technology in business is not as rapid as in the past.
•		We may face damage to our professional reputation or legal liability if our clients are not satisfied with our services.
•		Our services or solutions may infringe upon the intellectual property rights of others.
•		Our engagements with clients may not be profitable.
•		If our alliances do not succeed, we may not be successful in implementing our growth strategy.
•		Our global operations pose complex management, foreign currency, legal, tax and economic risks, which we may not adequately address.
•		The consulting, technology and outsourcing markets are highly competitive and the pace of consolidation, as well as vertical integration, among our competitors continues to increase. As a result, we may not be able to compete effectively if we cannot efficiently respond to these developments in a timely manner.
•		If we are unable to attract, retain and motivate employees, we will not be able to compete effectively and will not be able to grow our business.
•		We have only a limited ability to protect our intellectual property rights, which are important to our success.
•		Our profitability will suffer if we are not able to maintain our pricing and utilization rates and control our costs. A continuation of current pricing pressures could result in permanent changes in pricing policies and delivery capabilities.
•		Our quarterly revenues, operating results and profitability will vary from quarter to quarter, which may result in increased volatility of our share price.
•		We continue to position ourselves to achieve increasing percentages of revenues and growth through outsourcing. This strategy could result in higher concentrations of revenues and contributions to income from a smaller number of larger clients on customized outsourcing solutions or, in the case of our BPO businesses, from larger portfolios of clients for whom we provide similar services and solutions utilizing standard operating models. As we continue to accelerate the

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		growth of new outsourcing contracts, we may experience increased pressure on our overall margins during the early stages of these contracts.
•		On certain complex engagements where we partner with others, clients are increasingly demanding that we guarantee the performance of our business partners whom we do not control. New accounting pronouncements may also affect when and how we report revenues associated with certain engagements.
•		We may be named in lawsuits as a result of Arthur Andersen’s current legal and financial situation based on misconceptions about the nature of our past relationship with Arthur Andersen firms.
•		Negative publicity about Bermuda companies, such as our parent, Accenture Ltd, may lead to new tax or other legislation that could increase our tax burden and may affect our relationships with our clients.
•		We will continue to be controlled by Accenture Ltd, which in turn will continue to be controlled by our partners, whose interests may differ from those of our other shareholders.
•		The share price of Accenture Ltd Class A common shares may decline due to the large number of Class A common shares eligible for future sale.
•		We may need additional capital in the future, and this capital may not be available to us. The raising of additional capital may dilute shareholders’ ownership in us.
•		We are registered in Luxembourg, and a significant portion of our assets is located outside the United States. As a result, it may not be possible for shareholders to enforce civil liability provisions of the federal or state securities laws of the United States.
•		Luxembourg law differs from the laws in effect in the United States and may afford less protection to shareholders.