Richard Clarke - Managing Director of IR Bill Green - Chairman & CEO Pam Craig - CFO Steve Rohleder - COO

Adam Frisch - UBS Rod Bourgeois - Bernstein Moshe Katri - Cowen & Co. Julio Quinteros - Goldman Sachs Julie Santoriello - Morgan Stanley Pat Burton - Citigroup Andrew Steinerman - Bear Stearns George Price - Stifel Nicolaus Tien-Tsin Huang - J.P. Morgan Abhi Gami - Banc of America Elizabeth Buckley - Arete Research

Ladies and gentlemen, thank you for standing by, and welcome to the Accenture's Third Quarter Fiscal Year 2007 Earnings Conference Call. At this time, all participants are in a listen-only mode. Later we will conduct a question-and-answer session (Operator Instructions). As a reminder, this conference is being recorded. I would now like to turn the conference over to your host Managing Director of Investor Relations, Mr. Richard Clarke. Please go ahead, sir.

Thank you, Abraham. Thank you, and thanks everyone for joining us today on our third quarter fiscal year 2007 earnings announcement. As the operator just mentioned, I am Richard Clarke, Managing Director of Investor Relations. With me this afternoon are Bill Green, our Chairman and Chief Executive Officer; Pam Craig, our Chief Financial Officer; and Steve Rohleder, our Chief Operating Officer. We hope you've had an opportunity to review the news release we issued a short time ago. Let me quickly outline the agenda for today's call. Bill will begin with an overview of our results; Pam will take you through the financial details including the income statement and balance sheet; and Steve will add some operational perspective; Pam will then provide our business outlook for the fourth quarter and full fiscal year 2007; then Bill will close the presentation before we take questions. As a reminder, when we discuss revenues during today's call, we are talking about revenues before reimbursements or net revenues. Some of the matters we'll discuss on this call are forward-looking and you should keep in mind that these forward-looking statements are subject to known and unknown risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such statements. Such risks and uncertainties include, but are not limited to: general economic conditions and those factors set forth in today's press release and discussed under the Risk Factors section of our annual report on Form 10-K and other SEC filings. Accenture assumes no obligations to update the information presented on this conference call. During our call today, we will reference certain non-GAAP financial measures, which we believe provide useful information for investors. You can find reconciliations of those measures to GAAP, as well as a new schedule that provides a summary of shares outstanding and market capitalization on the Investor Relations section of our website at Accenture.com. So now, let me turn the call over to Bill.

Thank you Richard, and good afternoon everyone. We are just delighted that you could join us today as we discuss our third quarter financial results. We delivered another excellent quarter with solid performance and strong new business momentum. Our results reflect successful execution in helping our clients become high performance businesses and in driving value for our shareholders. Here are some of the highlights from the quarter. We grew revenues 15% in U.S. dollars with double-digit growth in both consulting and outsourcing. Our earnings performance of $0.54 was strong. We feel very good about the continued strength and momentum of our business and we’ve raised our outlook for EPS for the full fiscal year. We delivered strong new bookings of $6.2 billion, the highest bookings in 13 quarters. I am particularly pleased that this represents the third consecutive quarter of record consulting bookings. Demand for our services is strong and it's growing. Operating margin of 13.4% is inline with our expectations for the quarter and positions us to achieve operating margin expansion for the full fiscal year. Our balance sheet remained strong and we generated tremendous free cash flow of $896 million. We grew our headcount by 19% recruiting top talent, while attrition was stable and utilization continues to be well above 80%. With that, let me turn it over to Pam for details on the financials.

Thanks Bill and hello everyone. I am pleased to tell you more about our outstanding third quarter results. We showed strength across the board in revenues, earnings, bookings and cash flow. In short, our fundamentals remained strong and reflect the momentum in our business. Let me take you through some detail behind the numbers in our income statements, balance sheet and cash flow. Net revenues for the third quarter were $5.1 billion, a year-over-year increase of 15% in U.S. dollars and 9% in local currency, and at the high-end of our previous outlook of $4.9 billion to $5.1 billion. Consulting revenues were $3.1 billion, an increase of 16% in U.S. dollars and 9% in local currency over the third quarter last year. Outsourcing revenues were $2.0 billion, an increase of 15% in U.S. dollar and 9% in local currency over the same period last year. As we move down the income statement, I am going to provide comparisons to the third quarter last year on both a GAAP basis and on an adjusted basis. The adjusted basis excludes a $58 million benefit from a reduction and reorganization liabilities in the third quarter last year. Results on an adjusted basis were also included in today’s news release. Gross margin was 31.7% compared with 33.0% in the third quarter last year. SG&A costs were $921 million or 18.1% of net revenues. This compares with $816 million or 18.5% of net revenues for the third quarter last year. This improvement was inline with what we expected as we continue our multiyear efforts to reduce SG&A costs as a percentage of net revenue. GAAP operating income was $682 million, reflecting operating margin of 13.4%. This compares with $690 million or 15.7% operating margin on a GAAP basis, and $632 million or 14.3% operating margin on an adjusted basis in the third quarter last year. It is important to put our margin results in perspective. As you know, our margin results can vary quarter-to-quarter based on a number of factors. This quarter, we had a tough compare due primarily to the recording of one-time payments in connection with a winding down of a contract in our products operating group in the retail industry last year. Absent that one-time item, when we take into account all that has happened in our business, including getting any test behind us we feel good about our margins. Our underlying margin results were very solid, inline with our expectations, and allowed us to continue to accrue annual bonus and invest in our business. The effective tax rate for Q3 was 33.3%. This rate is slightly lower than our previous forecast due to a shift in income between countries. The year-to-date effective tax rate is 33.2% and includes the $21 million benefit from a discrete item recorded in the second quarter this year. Before this item the recurring effective tax rate for fiscal 2007 is 34.3%. GAAP income before minority interest was $473 million, compared with $499 million on a GAAP basis and $445 million on an adjusted basis in the third quarter last year. GAAP diluted EPS was $0.54 compared with $0.56 on a GAAP basis and $0.50 on an adjusted basis for third quarter last year. Now, lets turn to our cash flow and some key parts of our balance sheet. Free cash flow for the quarter was $896 million resulting from operating cash flow of $978 million, less property and equipment additions of $82 million. Our day’s services outstanding or DSO's were 36 days, reflecting our peoples continued focus on strong cash flow. Our total cash balance at May 31 was $3.09 billion compared with $3.07 billion at August 31st. Cash combined with $352 million of fixed-income securities classified as investments on our balance sheet was $3.45 billion compared with $3.53 billion at August 31st. Total debt was $28 million compared with $52 million at August 31st. And our balance sheet metrics continue to be strong. For the 12 months ended May 31st, our return on invested capital was 66%, our return on equity was 71% and our return on assets was 18%. Before I turn things over to Steve, I'll comment on share repurchases. In the third quarter, we repurchased or redeemed 24.1 million shares for approximately $835 million. This included 16.9 million shares repurchased or redeemed at a discount and 7.2 million shares purchased at market. The average price of shares repurchased and redeemed in the quarter was $34.71 per share. On a year-to-date basis through end of Q3, we repurchased or redeemed 57.9 million shares for approximately $1.9 billion at an average price of $32.96 per share. At May 31st, Accenture's total outstanding share repurchase authority was approximately $2 billion. In terms of our public flow, using what we believe to be the most conservative method of calculation, which excludes all outstanding founder shares. Our public flow at the end of the quarter was approximately 65%. All in all, we had a strong quarter and are extremely proud of our results. Now, Steve will give you some more detail on our operations.

Thank you, Pam. Hi everyone and thanks for joining us today. I am extremely pleased with our strong top and bottom-line results for the third quarter. The globalization trend I mentioned in Q2 continues, with clients growing their businesses through new market penetration, M&A activity and cross border consolidation. This trend is driving expansion in all three of our dimensions of our business, our operating groups, geographies and growth platforms. Let me take you through some highlights starting with the operating groups. Four of our five operating groups delivered record high revenues in U.S. dollars this quarter. Details of all five operating groups are in the news release, so I’ll just highlight a few here. Our double-digit expansion in resources was driven by strong consulting growth across all geographic regions, especially in energy and utilities. Top-line growth in financial services was primarily driven by strong demand in capital markets across all geographic regions, and we also saw growth in banking and insurance in EMEA. However, we continue to work to improve delivery and efficiencies, which affected operating income in the quarter. Products delivered strong revenue growth given the tough year-on-year comparison, Pam described earlier, which also affected operating income. The revenue growth was driven by consulting services across all geographic regions, strong outsourcing growth in the Americas, and solid contributions from Consumer Goods & Services and Health & Life Sciences. In terms of the geographic regions, in the Americas, revenues grew 7% in U.S. dollars and 6% in local currency driven by the United States and Brazil. EMEA revenues increased 19% in U.S. dollars and 8% in local currency driven by strong results in Spain, The Netherlands, Italy and Germany. Revenues in Asia Pacific grew 44% in U.S. dollars and 37% in local currency. This marks our fifth consecutive quarter of double-digit growth in both U.S. dollars and local currency in Asia Pacific. Now turning to our growth platforms. The globalization trend I referred to earlier is having the greatest effect in management consulting, with strong demand across all our service lines, especially supply chain, CRM and human performance. In outsourcing, we continue to see strong demand for both application outsourcing and BPO. Our work in the horizontal BPO space is being driven by finance, HR and customer contact work. We also had very strong BPO growth in Asia Pacific where our work is centered on finance and accounting, learning and procurement. In systems integration and technology, we continue to see strong demand for both SI and technology consulting. In SI, Global ERP work continues to be a strong driver of our growth. And the investment we're making in SOA is paying off as we're beginning to see an acceleration in this space in both Europe and the United States. In technology consulting, we recently announced plans to invest $250 million for offering an asset development, alliance development and recruiting and training. As one of the few technology platform independent service providers, we're really well positioned to address the increasing need for these services in the market. We continue to invest in the expansion of our global delivery network finishing the quarter with more than 63,000 people. This represents a 48% year-over-year increase in GDN headcount. In addition to substantial growth in India, we had 20% year-over-year GDN headcount growth in both the Americas and EMEA and more than 50% growth in the Philippines. The geographic diversity of our network continues to be a major competitive advantage for us. Finally, let me touch on a few operational metrics. Bookings in Q3 were very strong at $6.2 billion. Consulting bookings reached $3.5 billion, another quarterly record. Outsourcing bookings were $2.7 billion consistent with our targeted book-to-bill ratio. I'm pleased with the nature of our outsourcing bookings this quarter, as we continue to be selective about the opportunities we pursue. In terms of pricing, we've seen some improvement and I believe there's additional upside opportunity in technology consulting, management consulting and specialty SI skills. In SG&A, we achieved a 40 basis point improvement year-over-year and we’re on track to deliver solid improvement for the full fiscal year. Turning to people management, we ended the quarter with more than 158,000 employees, an increase of 19% over last year and are on track to reach our target of 60,000 new hires for the full year. Utilization remained strong at 85% and attrition was 18%. In closing, our performance this quarter is an extension of the solid results we delivered throughout the year. We're seeing strength in the market and I expect our business to continue on the positive growth trajectory we’ve established this year. With that, let me turn it back to Pam for our business outlook.

Thanks, Steve. For the fourth quarter, we expect revenues to be in the range of $4.8 billion to $5.0 billion. This range assumes a foreign exchange uplift of 3% to 4%. Turning now to the full fiscal year 2007. We continue to target new bookings to be in the range of $22 billion to $24 billion. We continue to expect our consulting bookings to represent more than half of the total. For revenue growth for the full fiscal year, we expect to be close to the top of the previously communicated range of 9% to 12% in local currency. We are raising our expected EPS for the full fiscal year to a range of $1.94 to $1.96. This reflects the continued strength in our business. We expect operating margins for the full fiscal year to be at the low end of the previously communicated range of 12.6% to 13.1%, which represents a minimum 20 basis points expansion over last year's results on an adjusted basis. Demand and market conditions continue to fuel strong growth and we are continuing to invest in our people and in the business. In terms of cash flow, we are raising our operating cash flow outlook to be $2.2 billion to $2.4 billion with property and equipment additions remaining at $335 million. We now expect free cash flow in the range of $1.9 billion to $2.1 billion. And finally, we now expect our annual effective tax rate to be in the range of 33% to 35%. Next quarter, we will provide business outlook for the upcoming fiscal year. We currently see a continuation of revenue growth of 9% to 12% in local currency for fiscal '08, and we will provide you with our formal outlook for the full fiscal year, when we announce our fourth quarter results scheduled for the end of September. With that, here is Bill to close before we take your questions.

Thank you, Pam. We’re going to open it up for questions in a few minutes here, but I just wanted to take a moment and make a few points. First: As I said, we are extremely pleased with our performance for the quarter and our consistently good results. We are delivering value for our clients and for our shareholders. We do this by operating our business in a smart way and by investing in critical assets we can leverage and in our people. We have the unique worldwide operating model that is globally efficient, locally responsive and leverages our worldwide capabilities. We believe we will continue to expand our lead. With that, lets take your questions.

(Operator Instructions) And we have a question from the line of Adam Frisch of UBS. Please go ahead. Adam Frisch - UBS: Thanks. Good afternoon guys. Got a whole lot to find forward here in the quarter, so another nice job and way to keep the momentum going. The only thing I wanted to ask you about was, I am sure, I'll come up with a couple more after this. But on margins, it seems like given the strength in the business, especially in consulting you have a lot of flexibility in terms of how you want to allocate some of your profits and maybe some were expecting margins to be a little bit better, right mind with what we were thinking, but are you guys, given the release that you put out, I think, it was last week about the $250 million investment in consulting. Are you guys taking advantage of what’s going on now in the marketplace to make sure you have the proper investments placed to keep the growth going into ’08 and hopefully into ’09 and after that?

Yeah. Adam let me, I think Pam explained very well of margins situation I think we spent a lot of time on it and we have a very unique and specific understanding of it. When we stand back and look at that the decisions we made for this business I mean we had 1 million moving parts in here. But at the end of the day, what we’ve done in technology consulting what we continued to do in the global delivery network, what we are doing in terms of building out assets and capabilities are based on the sort of next generation of solutions clients are going to look for is really serving us very well. We’ve got great traction with those and we have a great plan and program to continue to bring new products and services to market. I think what’s important to me is we have the right balance about how we’re making judgments about those. We pick very well and specifically in terms of where we spend the money. And then at the bottom-line we continue to beyond the trajectory towards the operating margin targets that we had originally set for ourselves. Adam Frisch - UBS: Okay. Good stuff and again not to really pick on it because if you want to look at EPS, you guys have raised your guidance every quarter. So again it’s not a pick there, its just more of a what’s going on. Consulting obviously the market environment is great you guys put up another phenomenal quarter consisting with your checks, but obviously people are going to ask okay, what was this then the peak, is there going to be a follow-up after this quarter are we going have a, when is the next down tics. So I guess I would ask you which might seem like a weird question given that you just put up $3.5 billion in consulting bookings but any signs out there of a slow down?

Well, Adam I know, I respect you for asking the question because I think it's an important one, and it's something that we look hard at all the time. Again, as I've mentioned over the past many quarters much of our business is driven by the confidence of CEOs to invest in their business. And I just came back from China. I was in the Germany and France last week, and around the U.S. this week, and frankly I see a lot of confidence in the marketplace in terms of what people are doing with their business, and all that stuff serves us very well. Additionally, and for over the last year we have put a lot more power behind our consulting business, in terms of the assets capabilities and attracting talent. So we feel pretty solid about the direction the business is going across the board, as we sort of read the tea leaves, the key things had influenced decisions in my mind continue to be the confidence of business were the need to compete. And those things haven't gone away. I think they continue to get more and more extreme, and I think that will continue to service well on the consulting side of the business. Adam Frisch - UBS: Okay. Great job guys. Thanks.

Thanks.

Thank you.

Next question is from the line of Rod Bourgeois of Bernstein. Please go ahead. Rod Bourgeois - Bernstein: Yes. Hey, it's Rod Bourgeois here. I wanted to kind of inquire. I appreciate your giving the initial comments about the fiscal '08 revenue growth outlook. Are you now expecting that your consulting business growth will begin to exceed the growth in the outsourcing business as you move into fiscal '08, when you look at the bookings pattern, and actually what we are also seeing in the market it would seem like you could now see the revenue mix shift back towards consulting. Is that a likelihood in the outlook?

We always believe we'll be a 50-50 a little sooner than we are. The reason, we are in this the consulting business has come roaring back. Frankly, we like the portfolios of the inbound business, better than we would have expected in all honesty, and I think it will continue as you know, with outsourcing it doesn't take, but two or three big deals to have an impact on the mix in any one quarter and even the across a year. So, I think that the nature of the outsourcing business has been in the mid-sized deals, which serves us well in terms of their durability, but I think there still will be some quarters where outsourcing dominates just because of the nature of some of the transactions that can be out there. I think the thing that's most important to us is we feel great about the mix right now, how it's unfolding, and more importantly we feel great about the ability to move our relationship from consulting through the development phases and into the outsourcing place. So, on balance, I think our mix that as you see now is going to be pretty consistent. Rod Bourgeois - Bernstein: Let be me more specific, I guess with where I am trying to go, I mean with the evaluation of the stock here it's really important that you guys are raising your cash flow guidance. I mean, that's just spectacular to see the $300 million increase there, but as you look into '08 Pam, I think clearly your mix shift towards consulting is helping your free cash flow this year. And so when I ask about consulting potentially continue into sort of actually having the ability to grow faster in fiscal '08 than outsourcing, it has implications for your free cash flow prospects. So, do you feel like consulting can exceed the growth of outsourcing as you move into next year? And then that continuing to be a tailwind in your free cash flow?

Well I don’t, I mean we don’t that’s not in discussion that we have around here. We are delighted with the momentum of consulting. We are running hard to keep up with the demand. And you know as all its one thing to sell and its another things to execute and the thing that’s important to us is to make sure and we have the capabilities to execute in the first class way and bring it to the bottom line. So I think right now we will continue to see a lot of breeze in the consulting space, because there is lot of demand out there. And our opportunity is to make sure we have the right people to address the demand and make sure we choose wisely in terms of the profitability of the relationships that we perceive. Rod Bourgeois - Bernstein: All right and with all that falling to the bottom line here, can you guys get more aggressive with the share buybacks or a higher dividends given the strong free cash flow that you have?

Well, hi Rod. Rod Bourgeois - Bernstein: Yeah.

We’re going to continue with our program of share buybacks through ‘09, as you know we still have the founder program that we were working through. And on the dividend yes we’ll be discussing with that with our board next months, so what we’ll plan to do next year. Rod Bourgeois - Bernstein: Okay. Great. And then Steve just one quickie for you there, the growth in Asia is really impressive. I mean, is that our rate that can be sustained or is there some lumpiness to that growth rate here off late?

Well, its anchored in Japan and Australia so if that’s what you mean by lumpiness I guess I’d answer that way, but I would also tell you that we’re seeing demand in Southeast Asia and China on a smaller scale. I do think we can sustain it as Bill, mentioned our big challenge is getting people to the jobs there, but demand is there. We got to be selective to make sure that we can meet the demand and basically deliver value to our clients, but the demand is defiantly there. I won’t predict whether we can sustain that rate or not. Rod Bourgeois - Bernstein: Okay. Thank you guys.

Thanks Rod.

Thank you Rod.

Next question is from line of Moshe Katri of Cowen & Company. Please go ahead. Moshe Katri - Cowen & Co.: Yeah, thanks, congratulation for a very strong quarter. Looking at your global delivery network, I think you've provided a headcount. Can you break it down by India, the Philippine and then other? Maybe also you can talk about some the metric that we typically focus on. Maybe talk about attrition rates in India that was an area focus. And then I think you have also have a specialized sales force that sell these kind of services into the offshore global delivery network. Have you change the headcount and that group as well, if you can talk a bit about that?

Yeah. Let me address the headcount. For India and I think we normally talk about India headcount, we crossed the 30,000 mark and we're well on the prediction to hit 35,000 for the fiscal year. In terms of Philippines, I'd have to get the exact numbers Moshe, but I would tell you that by the end of the fiscal year the Philippines would be our third largest location within Accenture just in terms of headcount. At about probably roughly about 11000. The sales force question is a good one, in fact this week I sat down with the guys and went through where we at in terms of our basic AOL offering. And they have increased the sales director slightly this year. That said, I think based on the readout that I receive the productivity of these guys has increased substantively this year. And I am very pleased with what we are doing in that area right now. I am not sure it's one for one adding a sales director and growing as financially I think it’s the effectiveness and the efficiency of the sales directors that we have, and how they use our channel that is really going to drive the growth for us. Moshe Katri - Cowen & Co.: And then can you comment a bit about the competitive landscape, is it helpful that your closest large competitor is being a bit more kind a discipline in terms of the types of services, they are focusing on? And then may be you can talk a bit about competitively the tier1 offshore vendors as well?

Yeah, what I mean is this is Bill, I guess, I’ve just if you -- you really have to peel this thing back globally and yet to peel it back by the industry, so it’s really hard to generalize. I think the thing that’s most important to us is, we feel good about our competitive position, and that starts with having differentiated products and services that deliver value. The second things is we do see and Steve can comment on this more we do see better pricing power in the market than we’ve seen in quite sometime, and we do see you know still a lot of source opportunities in the market. So, to us those are the things that we start with. In the shootouts, the competitive shootouts, I think we hold our own and we win more than our share. But we spend a lot of time in making sure that, that we are first and foremost to able to differentiate in terms of the products and services we bring in the value we are producing. That’s where some of our investments have gone over the past year. So we can put those things in the hands of our teams to take them to market.

And just on your tier1 question Moshe, quarter-on-quarter, there really hasn’t been much difference in terms of the deals where we’re competing against the tier1 India pure-plays, we’ve seen may be a slight uptake and the ERP area where we’re seeing them expand a little bit, but by and large it’s the same competition in the basic aerospace that we’ve seen. Moshe Katri - Cowen & Co.: Thanks. Nice quarter.

Thanks.

Next question from the line of Julio Quinteros of Goldman Sachs. Please go ahead. Julio Quinteros - Goldman Sachs: I want to ask this quick question just to go back to the other two comments. I think Steve you made about the both products and the financial services. I just want to make sure I understand the comment that you made related to the operating profit in fact of both of those segments? And then I guess Pam if you could just sort of relate that to the other difference between the other range of 20 to 70 basis points on operating margin expansions that you had expected previously or that was those were two sources of the delta between the high end versus the low end of margin expansion for the year?

Yeah Julio let me start and I’ll let Pam, draft in behind. I wanted to just to your question on products and financial services both are different situations. Products as Pam, talked about had a tough compare with a one-time event in retail client in EMEA. Frankly, their business is still very strong and in spite of that they posted some freight results both top line and bottom line. When you take out that one time event. Financial services is a bit of a different story because for the last three or four quarters. I’d been talking about our program to get the pipeline built up to generate demand and frankly to drive work at the top line. We’ve experienced that top line growth. Now we have some work to do just make sure that we got the people, the tools and we’re delivering what we’ve said we were going to deliver and frankly that’s the delivery and as I mentioned and Pam, you may want to.

Would this go overall Julio, we were really pleased with the operating margin of 13.4% in fact well against their plan, the underlying margins were up from last year as you take out the one-time item and products that we talked about. And so, it allowed us to accrue annual bonus and continue to invest in the business. And I think when you see that we are growing EPS by over 20% this year, and that will expand operating margin by at least 20 basis points, we are very comfortable with where we are. Julio Quinteros - Goldman Sachs: Okay. And then finally for the fiscal year '07, did you gave a projected share count that you expected for the full year?

We did not give it. But, we can get that plan. Julio Quinteros - Goldman Sachs: Okay. Great, thanks.

Next question is from the line of Julie Santoriello of Morgan Stanley. Please go ahead. Julie Santoriello - Morgan Stanley: Thank you. Good afternoon. My question is on pricing. Steve, I know mentioned you are seeing some price increases. I am wondering if you are surprised, although you are not seeing an even stronger pricing. Just given the very strong demand environment and the high utilization. And if you can comment on the competition and the consulting side as well? And if there anything that you are seeing different on the competition front, especially offshore?

No, I mean, first on the competition. As I was mentioned earlier there, in the offshore area there really isn't much difference other than slide uptake in ERP area. On the pricing front, I think the key for us to continue to make progress here is to deliver the differentiated skills that we have to our clients. And we put a specific program in place. We've now had it in place for two quarters. And we've expanded that this quarter into some specialty systems integration areas around some of the ERP vendor skills. And frankly, just going to take time to have that work its way through the system, and to have the new contracts with the higher pricing replace, and what we've got in place with some of our master services agreements right now, so I am happy with the progress we are making, we're going to continue to focus on it and push the pricing given the utilization that we have. Julie Santoriello - Morgan Stanley: Okay, thanks. Also on the government vertical, looked a little bit weak in terms revenue growth at least in local currency, can you give us an update there. I know there's been some issues with federal government spending?

Yeah. If I step back and look at the Government OG, large percentage of the work is centered in the United States, and large percentage of that is in the federal space and the slow down and the budget process, the continuing resolution and lot of people refer to frankly has slow down some of the decision making process that said, what we are saying is our clients are beginning to breakup into smaller pieces, the work that they want to extent for us. So I am not concerned it all about the volume we're dropping off, it's strictly a timing issue. Julie Santoriello - Morgan Stanley: Okay. And just one more question, you mentioned you're beginning to see acceleration in SOA, can you put some sort of numbers or sizing around that, can you talk it all about, the number of engagements that you have in SOA, and also just from a big picture standpoint is the SOA work that you are doing and that you see coming is it going to be incremental to revenue or is it really just cannibalizing other piece of yours systems integration revenue?

This is Bill. I'll speak to that for a minute. I think if you look at it for the near term and the medium term, it's incremental, and here is why; there is lots of going on sort of traditional stuff, but all the big enterprises have at least their toe in the water. Some of them are up to their knees in the SOA space. And these people build that out and as the science catches up and the durability and scalability and some of other things happen. People are going to continue to generate the next platform of solutions in that architecture. I mean, frankly, I couldn’t even count the number of SOA engagements that we have going on around the world right now. They are vast in number but generally small in size and I think over the next 18 months, we are going to see a lot more big industrial strengths, solution delivery projects that leverage that architecture as the tools and technologies catch up and as people get more experience in their own shops with doing it. I would tell you that, we’ve been infusing it into our workforce for just about two years now, almost on a weekly basis. So we feel very well positioned for that and we do believe very specifically and very sincerely that SOA is going to be a bona fide way that drives demand for new solutions in this industry. Julie Santoriello - Morgan Stanley: Okay. Thank you.

Next question in the line from Pat Burton of Citigroup. Please go ahead. Pat Burton - Citigroup: Hi. Congratulations on the quarter as well. My question is for Pam and that relates to the 3% to 4% revenue growth from the weak dollar. Do you see that falling through into gross profitability as well or does that only just help the top line from an accounting perspective?

Well, it mostly helps the top line because most of the time you have the corresponding cost going against it. But it does contribute a bit to gross margin as well. Pat Burton - Citigroup: Okay. And then, a follow up on the new free cash flow range within the 19 to 21, not to be difficult but with the quarter to go, what could be the puts and takes within that range, where it could come in at the low end or the high end? Thanks.

Pat, I mean it’s more just see how accrued in stuff play out and taxes and stuff like that. Pat Burton - Citigroup: Okay. Thank you.

Next question is from the line of Andrew Steinerman of Bear Stearns. Please go ahead. Andrew Steinerman - Bear Stearns: Hi, it’s Andrew Steinerman of Bear Stearns. When you look at the gross margin in the quarter, putting aside the U.K. cancellation fee from a year ago, Pam could you comment like you did last quarter on how you viewed the kind of the lower gross margin year-over-year?

Yes. Hi, Andrew. Well first of all again the 13.4%, seasonally our third quarter is typically very strong as it was this year. And when we took out the one-time item, if you look at the underlying margins we did see improvement this year quarter-over-quarter. Andrew Steinerman - Bear Stearns: And what drove their improvement year-over-year?

I am not going to share that Andrew but it definitely was going in the right direction. Andrew Steinerman - Bear Stearns: Right. So utilization with the same year-over-year, my only question is, were bill rate increase is enough to offset wage increases?

Yes, we’ve been tracking well with the getting the price increases for the wage increases this week. Most of those go in September, as you know, and so we’ve pretty much through that at this point. Andrew Steinerman - Bear Stearns: Super. Thanks for your help.

Next question is from the line of George Price of Stifel Nicolaus. Please go ahead. George Price - Stifel Nicolaus: Thanks, very much. Can you hear me?

Yes. George Price - Stifel Nicolaus: Great. First question, I wonder if we can get a little bit more commentary around the delivering efficiencies that you mentioned, I think specifically in EMEA? What are those related to? And are any related to relatively recent wins like, you know, we were particularly on the HR side, can you give us a little more color on that?

No. George, you know frankly I don't want to discuss individual contracts on the call. But the delivery inefficiencies were focused in financial services as an operating group. So, and frankly I feel like we identified them early and we're taking care of them. George Price - Stifel Nicolaus: Okay. Second question here for fiscal '08, the preliminary revenue outlook realized that there is more to follow, but you've said in the past that you see a good deal of work side potential operating margins as you continue to focus on SG&A. Where do we stand in that process overtime? Can we assume that that continues to be the case as we look in the fiscal '08?

Yeah, that will all go into the planning mix, right? We'll be looking for continued leverage in SG&A. We'll look for continued pricing power, continued leverage of the global delivery network. So those are all the kinds of things that will go into the mix of profitable growth. George Price - Stifel Nicolaus: Last question, Pam if the dollar stayed flat out through the rest of, for the rest of fiscal '08. What would FX due for next year?

We haven't projected that yet. George Price - Stifel Nicolaus: Okay.

As you know we see that revenues is growing 9% to 12% in local currency and that's the point we're at. George Price - Stifel Nicolaus: Okay. Great. Thank you.

Thank you.

Next question is from the line of Tien-Tsin Huang of J.P. Morgan. Please go ahead. Tien-Tsin Huang - J.P. Morgan: Thanks. Question on the outsourcing portfolio. How would you describe, I guess the risk profile of the contract in aggregate today, relative to history? And I am just trying to gauge the risk of problem contracts emerging, you feel bored to us but just wanted to confirm?

Yeah, Tien-Tsin, this is Steve, yeah I think last quarter, I talked about the relative size of the contracts coming down, and while that was happening our average yield is still consistent and that holds for this quarter as well. Frankly as clients' breakup, work into smaller pieces that does have an impact on the risk, I think overall it lowers risk of the portfolio and I think that’s where we're at right now. Tien-Tsin Huang - J.P. Morgan: And then you spoke little bit about the pipeline; can you just elaborate a little bit? Are there large chunky deals on the horizon in outsourcing?

No, I mean I think we've got a pipeline that can support the growth and support the book-to-bill ratio that we've targeted for the fiscal year. It's hard to say whether I don't know, well, how you characterize chunky? We do have some large deals. We have a number of smaller deals too. Most of our deals are between $100 million and $300 million though. Tien-Tsin Huang - J.P. Morgan: Got you. And then did I hear correctly that the GDN headcount growth is up 48% in the quarter?

Yes. Tien-Tsin Huang - J.P. Morgan: The 48% is revenue growth still tracking within the range of the headcount growth?

Yes. Tien-Tsin Huang - J.P. Morgan: Terrific. And then just a small maybe for Pam, I guess what droves the spike in the other expenses line that was below EBIT? I think it was $16 million and also the gain on investment, what exactly with that? Thank you.

We had a small investment that way back when we had a venture portfolio many years ago and we have just a tiny bit left from that and we sold and had a gain on it of about $10 million. Tien-Tsin Huang - J.P. Morgan: And then the other income?

The other income/expenses is mostly just interest in foreign exchange. Tien-Tsin Huang - J.P. Morgan: And it look like it’s spiked up a little bit sequentially and year-on-year?

Yes. By about $6 million. Tien-Tsin Huang - J.P. Morgan: Okay. So nothing else as unusual.

No. Tien-Tsin Huang - J.P. Morgan: Thank you.

Next question is from the line of Abhi Gami of Banc of America. Please go ahead. Abhi Gami - Banc of America: Hi, thanks. Lets drive down a little bit deeper on the Asia Pacific growth. Is this growth coming primarily from the local customers or from the local operations of your global clients?

More the former than the later Abhi Gami, I think the again, if you look at the concentration its primarily in Japan and Australia and I would tell you that the operating groups that are experiencing most of the growth are communications in hi-tech government and financial services, but primarily from local companies in those countries. Abhi Gami - Banc of America: Thanks Bill. And you know Japan I think you’ve mentioned before Japan has been source of strength. Has something changed in the client environment or has something changed in the way Accenture is pursuing the Japanese market?

No, I think we have seen a shift over the last two to three quarters and more of an emphasis on business process outsourcing and outsourcing in general, that’s where the strong demand is both in the pipeline and what we’ve experienced in the last few quarters. So I believe there has been a shift to more outsourcing in that region. Abhi Gami - Banc of America: And final question is Accenture investing ahead of that growth in the Asia Pacific region or are you investing along with the kind of demand you’re seeing?

Well this is Bill, I mean the scenario that I look after and what we call it is positively discriminating towards the business over there. And so we’re very careful not to get too far out of head of the growth, but frankly the growth has been there, the investments have been there, the people are coming through the pipeline that are just terrific. Next generation leaders that are going to define the future of Accenture there so, we do positively discriminate towards Asia to make sure they have the talent and the offerings and the resources as they need to take advantage of the market there. Abhi Gami - Banc of America: Thank you very much.

Operator, we have time for one more question.

And your last question is from the line of the Elizabeth Buckley of Arete Research. Please go ahead. Elizabeth Buckley - Arete Research: Yes, good afternoon. Question on the outsourcing area, looking at the decline in bookings that we saw over the quarter, you mentioned greater sale activity as one of the explanations, in what parts of the market are you seeing competition are intensified?

Well, I think the competition is there in all segments. In application outsourcing, all segments of the BPO business, the horizontal BPO business I mentioned and into a certain extend in the verticals, but more in the horizontal BPOs. We are being selective frankly, and it’s in a few of the horizontal BPOs where we don’t want to get demand ahead of what we can supply and what we can deliver Elizabeth. Elizabeth Buckley - Arete Research: And just, could you give us a sense of what percentages of our outsourcing revenues are of BPO today?

I don’t believe, we report separate segments that way. Elizabeth Buckley - Arete Research: And you can’t get this, just a general feel for the relative strength of the BPO in the mix?

Well, I’d rather not. We look at outsourcing as a combination and by the way it’s very difficult to breakout some of the overlapping BPO segments anyway. So, I’d rather not. Elizabeth Buckley - Arete Research: And I guess, I meant looking at the decline and could we also read into this just a change in management’s focus given the better opportunities and demand that you are seeing on the consulting side?

I don’t thing its change. I do think it’s a combination of being selective and it’s also a combination of the timing of the opportunities and when they close. Quarter-on-quarter its difficult to predict a steady state of bookings, because one big deal can move into another quarter and really skew the overall results. So, I would say overall I am still very happy with what we’ve got in the pipeline. Frankly, some of the things have slipped into other quarters. We’ve closed some in Q3. So the quarter-on-quarter compare isn’t as important to me as where our pipeline is and the profile of the opportunities that we are chasing. Elizabeth Buckley - Arete Research: Okay. Thanks.

Thanks.

This is Bill, if I could just take a minute to wrap up. First, as you have heard from all of us, we are delighted with the momentum in our business and the way the year is progressing. We remain focused on profitable growth by addressing the many opportunities in the market place in meeting the strong demand for our services. We believe we have a strong market differentiator and our ability to serve clients from idea, through design, implementation and operation to do it globally and across every industry. We continue to have the right balance of driving shareholder value for today and investing in our business for the tomorrow. And most importantly, we have great people at Accenture. And thanks to them, we are producing excellent results for our clients and for our shareholders. Thank you for joining the call today and for your continued support at Accenture.

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