NEW YORK; April 24, 2002 – Contrary to information provided in a press kit distributed during a news conference today by the sponsors of H.R. 3884, Accenture did not reincorporate from the United States to Bermuda.
Accenture is a global organization with 75,000 people working in 47 countries around the world. Accenture has never been a U.S.-based or -operated organization and has never operated under a U.S. parent corporation. Despite these facts, Accenture was included in materials distributed at this afternoon’s news conference and has also been incorrectly included in recent reports regarding U.S.-based companies that have re-incorporated in Bermuda to avoid paying U.S. taxes.
The fact is that Accenture pays, and has always paid, U.S. taxes on income generated by its U.S. operations. Deriving more than half of its revenues from operations outside the United States, Accenture also pays taxes on non-U.S. income in the countries in which that income is generated. Accenture expects its overall effective tax rate for fiscal year 2002 to be approximately 44 percent, on a GAAP basis, and the effective tax rate for its U.S. operations (state and federal) for the same period to be approximately 42 percent, on the same basis.
Historically, Accenture operated as a group of more than 40 locally owned partnerships and other entities, coordinated through a Swiss-based entity. In 2001, Accenture’s 2,500 partners, more than half of whom were non-U.S. citizens, chose to move to corporate form and seek a public listing in order to build the capital structure necessary to fuel the company’s continued growth. With thousands of partners and employees of many nationalities, it was particularly important, as a cultural matter, for the organization to select a neutral location for its parent company. After considering a variety of options, Accenture’s partners chose to incorporate the parent company, Accenture Ltd, in Bermuda. Bermuda was chosen as a neutral location for Accenture’s diverse and global business and employee base.
In addition, as a matter of detail, materials in the press kit distributed at the news conference today incorrectly state that Accenture’s contracting work for the U.S. federal government was estimated to be $1 billion. In fact, Accenture’s revenues from its U.S. federal government business were approximately $334 million in its most recent fiscal year, ended August 31, 2001. The $1 billion figure represents Accenture’s total revenues derived from its work for all government entities around the world during this period.