Accenture plc (ACN)
Cash conversion cycle
| 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 |
| Cash conversion cycle | days | 48.85 | 44.56 | 44.39 | 44.34 | 42.99 |
August 31, 2024 calculation
Cash conversion cycle = DOH + DSO – Number of days of payables
= — + 66.78 – 17.93
= 48.85
The cash conversion cycle for Accenture plc has shown a slight upward trend over the past five years. In 2020, the company's cash conversion cycle was 42.99 days, and it has increased to 48.85 days in 2024. This indicates that Accenture plc is taking longer to convert its investments in inventory and accounts receivable into cash.
A longer cash conversion cycle can be indicative of inefficiencies in managing working capital and could potentially signal liquidity challenges. It is important for the company to closely monitor and manage its cash conversion cycle to ensure smooth operations and sustainable cash flows.
Overall, the trend in Accenture plc's cash conversion cycle suggests a need for the company to focus on improving its working capital management practices to potentially reduce the cycle duration and enhance its overall financial performance.
Peer comparison
Aug 31, 2024