Accenture plc (ACN)
Activity ratios
Short-term
Turnover ratios
| Aug 31, 2024 | Aug 31, 2023 | Aug 31, 2022 | Aug 31, 2021 | Aug 31, 2020 | |
|---|---|---|---|---|---|
| Inventory turnover | — | — | — | — | — |
| Receivables turnover | 5.47 | 6.00 | 5.87 | 5.74 | 6.16 |
| Payables turnover | 20.35 | 22.38 | 20.58 | 19.01 | 22.48 |
| Working capital turnover | 34.49 | 11.93 | 15.07 | 12.77 | 8.71 |
1. Receivables Turnover:
Accenture's receivables turnover has been relatively stable over the past five years, ranging between 5.47 and 6.16. This ratio indicates that the company collects its accounts receivables approximately 6 times a year on average. A higher receivables turnover ratio suggests efficient management of credit and collection processes.
2. Payables Turnover:
The payables turnover ratio for Accenture has shown a decreasing trend over the last five years, falling from 22.48 in 2020 to 20.35 in 2024. This ratio indicates that the company pays its suppliers approximately 20 times a year on average. A decreasing payables turnover ratio may imply longer payment terms with suppliers or a shift in purchasing strategies.
3. Working Capital Turnover:
Accenture's working capital turnover has exhibited an increasing trend over the period, with a notable jump from 8.71 in 2020 to 34.49 in 2024. This ratio measures the efficiency of a company's working capital management in generating sales. A higher turnover ratio signifies effective utilization of working capital resources to support revenue generation.
Overall, analyzing Accenture's activity ratios reveals that the company has been effectively managing its receivables, payables, and working capital turnover over the years, indicating operational efficiency and effective utilization of resources in supporting the company's revenue generation activities.
Average number of days
| Aug 31, 2024 | Aug 31, 2023 | Aug 31, 2022 | Aug 31, 2021 | Aug 31, 2020 | ||
|---|---|---|---|---|---|---|
| Days of inventory on hand (DOH) | days | — | — | — | — | — |
| Days of sales outstanding (DSO) | days | 66.78 | 60.86 | 62.13 | 63.54 | 59.22 |
| Number of days of payables | days | 17.93 | 16.31 | 17.74 | 19.20 | 16.23 |
To analyze Accenture plc's activity ratios:
1. Days of Inventory on Hand (DOH): Unfortunately, data for Days of Inventory on Hand (DOH) is not available in the provided table for the years 2020 to 2024. DOH indicates the number of days a company holds inventory before selling it. A lower DOH is generally favorable as it suggests efficient inventory management and swift turnover of goods.
2. Days of Sales Outstanding (DSO): The Days of Sales Outstanding (DSO) has shown a fluctuating trend over the past five years, ranging from 59.22 days in 2020 to 66.78 days in 2024. DSO reflects the average number of days it takes for a company to collect payment after making a sale. A decreasing trend in DSO indicates improved efficiency in collecting accounts receivable and managing cash flow.
3. Number of Days of Payables: The Number of Days of Payables has also fluctuated over the same period, with values ranging from 16.23 days in 2020 to 19.20 days in 2021. This ratio signifies the average number of days it takes for a company to pay its suppliers. A higher number of days of payables can indicate a more favorable financing position for the company, as it implies the company is taking longer to settle its payables.
Overall, a detailed examination of these activity ratios can provide insights into how effectively Accenture plc manages its inventory, collects receivables, and pays its suppliers, which are crucial factors in evaluating the company's operational efficiency and financial health.
See also:
Accenture plc Short-term (Operating) Activity Ratios
Long-term
| Aug 31, 2024 | Aug 31, 2023 | Aug 31, 2022 | Aug 31, 2021 | Aug 31, 2020 | |
|---|---|---|---|---|---|
| Fixed asset turnover | 42.66 | 41.90 | 37.12 | 30.83 | 28.68 |
| Total asset turnover | 1.16 | 1.25 | 1.30 | 1.17 | 1.20 |
Accenture plc's long-term activity ratios indicate how effectively the company is utilizing its assets to generate revenue over the years.
1. Fixed Asset Turnover:
- The fixed asset turnover ratio has been increasing steadily from 2020 to 2024, reaching a high of 42.66 in 2024.
- This indicates that Accenture is generating $42.66 in revenue for every $1 invested in fixed assets in 2024.
- The increasing trend suggests that Accenture has been able to efficiently utilize its fixed assets to generate revenue over the years.
2. Total Asset Turnover:
- The total asset turnover ratio has varied over the years, with a peak of 1.30 in 2022 and a low of 1.16 in 2024.
- This ratio reflects how efficiently Accenture is using all its assets to generate revenue.
- While there has been some fluctuation, the overall trend shows that the company is effectively generating revenue relative to its total asset base.
In conclusion, both the fixed asset turnover and total asset turnover ratios indicate that Accenture plc has been effectively utilizing its assets to generate revenue, with an increasing trend in fixed asset turnover and a relatively stable performance in total asset turnover.