Ladies and gentlemen, thank you for standing by. Welcome to Accenture’s Fourth Quarter Fiscal 2015 Earnings Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session. Instructions will be given at that time. [Operator Instructions] As a reminder, this conference is being recorded. I’d now like to turn the conference over to our host, Managing Director, Head of Investor Relations Ms. KC McClure. Please go ahead.

Thank you Greg and thanks everyone for joining us today on our fourth quarter and full-year fiscal 2015 earnings announcement. As Greg just mentioned, I’m KC McClure, Managing Director, Head of Investor Relations. With me today are Pierre Nanterme, our Chairman and Chief Executive Officer; and David Rowland, our Chief Financial 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. Pierre will begin with an overview of our results. David will take you through the financial details, including the income statement and balance sheet, along with some key operational metrics for both the fourth quarter and the full fiscal year. Pierre will then provide a brief update on our market positioning before David provides our business outlook for the first quarter and full fiscal year 2016. We will then take your questions before Pierre provides a wrap-up at the end of the call. As a reminder, when we discuss revenues during today's call, we're talking about revenues before reimbursements or net revenues. Some of the matters we'll discuss on this call, including our business outlook are forward-looking and as such, are subject to known and unknown risks and uncertainties, including but not limited to those factors set forth in today's news release and discussed in our annual report on Form 10-K and quarterly reports on Form 10-Q and other SEC filings. These risks and uncertainties could cause actual results to differ materially from those expressed in this call. During our call today, we will reference certain non-GAAP financial measures, which we believe provide useful information for investors. We include reconciliations of non-GAAP financial measures where appropriate to GAAP in our news release or in the Investor Relations section of our website accenture.com. As always, Accenture assumes no obligation to update the information presented on this conference call. Now, let me turn the call over to Pierre.

Thank you, KC, and thanks everyone for joining us today. We are extremely pleased with our strong financial results for both the fourth quarter and the full fiscal year. Our excellent fourth quarter performance continues the momentum we have been building in our business all year. For the full year, we delivered strong new bookings, generated record revenues, grew EPS faster than revenues and generated strong free cash flow, all while continuing to invest in our business and delivering significant value for clients and shareholders. Here are a few highlights for the year. We delivered very strong new bookings of $34.4 billion, we grew revenues 11% in local currency to a record $31 billion, our growth was broad-based across the business including double-digit growth in four of our five operating groups and all three geographic regions. We delivered earnings per share of $4.82 on an adjusted basis, a 7% increase. We expanded operating margin 20 basis points to 14.5% on an adjusted basis; we generated free cash flow of $3.7 billion. We returned $3.8 billion in cash to shareholders through share repurchases and dividends. And we just announced a semiannual cash dividend of $1.10 per share, an 8% increase over our prior dividend. So, I feel very good about what we delivered in fiscal year 2015. Our outstanding performance clearly demonstrates that we continue to provide highly relevant and differentiated services to all clients. Now, let me hand over to David. David, over to you.

Thank you Pierre and thanks all of you for joining us on today’s call. Let me start by saying that we were very pleased with our overall results in quarter four which culminated an extremely strong year for Accenture. Once again, our results reflect our unique position in the marketplace, the relevance of our growth strategy and our ability to drive our business to produce value for our clients, our people, and our shareholders. As you listened to our prepared remarks, you’ll hear continued consistency in the key business drivers and three overriding themes; durability of revenue growth, sustainable margin expansion, and strong cash flow with disciplined capital allocation. Before getting into the details, I'd like to emphasize a few highlights in each of these areas. Revenue momentum continued with very strong local currency growth of 12% even against our toughest quarterly compare of the year. A key characteristic was our balanced growth across our operating groups, our geographic regions, and our five businesses which speak of the durability of our growth strategy. Our rate of growth continued to outpace the market as we gained share in most dimensions of our business. Driving profitable growth with sustainable margin expansion continues to be our focus. And in the fourth quarter, our operating margin came in as expected and consistent with last year. For the full year, we delivered 20 basis points of margin expansion on an adjusted basis, while investing significantly to position our business for long-term market leadership. And finally, we delivered another quarter of strong cash flow, $1.4 billion in free cash flow to be specific. In terms of capital allocation, it's noteworthy that we closed 11 acquisitions in the quarter. Given us 18 acquisitions for the full year, we’ve invested capital of $800 million providing us with scale…

Thank you, David. Our excellent results for the year reflect the successful execution of our strategy across the different dimensions of our business. We are making focused investments in high growth areas including more than $2.5 billion in acquisitions over the last three years. These investments are all about building new capabilities to further differentiate Accenture in the marketplace. At the same time, we have aligned our organization around five businesses; Accenture Strategy, Accenture Consulting, Accenture Digital, Accenture Technology and Accenture Operations, all highly competitive in their own rights and synergistic in delivering end-to-end outcomes for clients. In particular, the new innovative services we have created in Accenture Digital and Accenture Operations have contributed significantly to our growth. In Accenture Digital, we are working with our clients to help them create competitive advantage and tap into new sources of value. In Accenture Analytics, we are using our new Accenture Insights Platform to help Thames Water in the UK embrace the Internet of Things to transform decision-making. Our new cloud-based solution monitors and analyses data in real-time from more than 20,000 centers and with data visualization tools, managers can proactively respond to risk on the network. And we are helping one of the largest banks in the Euro zone implement a major digital transformation. We are combining our design capabilities from Fjord which we acquired two years ago with our analytics capabilities to create a new and seamless multichannel customer experience, while also driving significant operating efficiencies. In Accenture Operations, we have strong momentum across our infrastructure, business process, security and cloud services. In procurement, we continue to lead the market building on the capabilities we acquired with Procurian. Let me share two examples. We are helping Glencore Queensland, a division of the global mining company to enhance its competitiveness. With…

Thank you, Pierre. Let me now turn to our business outlook. Starting with the first quarter of fiscal ’16, we expect revenues to be in the range of $7.7 billion to $7.95 billion. This assumes the impact of FX will be a negative 8.5% compared to the first quarter of fiscal '15 and reflects an estimated 6% to 9% growth in local currency. For the full fiscal year '16, based upon how the rates have been trending over the last few weeks, we currently assume the impact of FX on our results in USD will be negative 4% compared to fiscal ’15. For the full fiscal '16, we expect our net revenues to be in the range of 5% to 8% growth in local currency over fiscal ’15. For operating margin, we expect the fiscal year '16 to be 14.6% to 14.8%, a 10 to 30 basis point expansion over adjusted fiscal '15 results. We expect our annual effective tax rate to be in the range of 25% to 26%. For earnings per share, we expect full year diluted earnings per share for fiscal '16 to be in the range of $5.09 to $5.24 or 6%$ to 9% growth over adjusted fiscal ’15 results. Turning to cash flow, for the full fiscal '16, we expect operating cash flow to be in the range of $4.1 billion to $4.4 billion, property and equipment additions to be approximately $500 million and free cash flow to be in the range of $3.6 billion to $3.9 billion. We expect to return at least $4 billion through dividends and share repurchases and also expect to reduce the weighted average diluted shares outstanding by just under 2% as we remain committed to returning a substantial portion of our cash to shareholders. Finally, you may have noticed that I did not provide new bookings guidance for fiscal 2016. Each year we evaluate our guidance approach to ensure that we're providing appropriate visibility to our expected results. Starting this year we will no longer provide new bookings guidance as we believe that it is not the best indicator of future revenue performance and has created confusion in recent years. We will continue to report actual new bookings results each quarter. With that, let's open it up so that we can take your questions. KC?

Thanks, David. I would ask that you each keep to one question and a follow-up to allow as many participants as possible to ask a question. Greg, would you provide instructions for those in the call please?

Thank you. [Operator Instructions] Your first question comes from the line of Tien-tsin Huang from JPMorgan. Please go ahead.

Thanks. Good morning. Good revenue growth yet again, just wanted to ask I guess just in the hindsight here, probably you guys did 11% revenue growth in fiscal '15, I think your initial expectations was 4% to 7%. So what drove the upside versus initial expectations, just trying to gauge what was strong versus conservatism and sort of how that may reflect in this year's guidance?

Yeah, I mean I think just reflecting on ’15 and, Pierre, I’m sure we will have some reflections as well. I mean the first thing I would start off with is the fact that while we were confident that we were well-positioned for a very attractive market in the digital space, frankly, it’s hard and I'm sure you are going to appreciate this Tien-Tsin. It would have been hard to bank on and predict 35% growth in our digital-related services business. So that clearly was part of the driver. I think secondly, while we also felt very confident in our operations business, which is truly distinctive in the marketplace, no doubt about that, the growth rate was higher. We knew it would be strong, but it came in even stronger than we expected. When I reflect on the operating groups and you may remember and I won’t recount what I’ve said or recap what I’ve said when we started the year, but I had laid out a view of how we thought the operating groups would emerge. I mean, clearly when you look at CMT’s growth for the year, as proud as we are of that growth, it frankly would have been tough to predict that level of growth, double-digit growth in all industries and in all three geographic markets. I mean, that is kind of a trifecta of stars aligning. On the other end of the spectrum, not to go through every operating group, we were comfortable with our turn to growth in resources but yet there were still some risk as we highlighted and at the end of the day, congratulations to our resources team again that they’ve reconnected with growth and sustained very solid growth. And then I think across the patch, when we talk about consulting in our traditional type of work way, which in our new way of looking at the business includes strategy, consulting and part of application services related to application development within app services, that part of our business was very strong in ’15 and exceeded our expectations.

Yeah, I mean, not much to add. I think it clearly, I mean, to summarize, we’re overachieving three areas mainly; CMT, digital business and operations. When it comes to operations, more -- significantly more than we accepted.

Now that’s helpful. I guess as my follow-up, I’ll ask just on this year’s guidance. Just how much is coming from acquisitions? I know, you have got Navitaire coming up as well and can you give us any sort of range on what digital growth might look like in ’16? Thank you.

Yes. Just working backwards, Tien-Tsin, I’ll give you a view on digital growth as well as our dimensional growth. I’m going to give that view at I-Day, as we’re still working through our view on that. And just to your other question, I’ll start with ’15. Our inorganic contribution I signaled last quarter was in the range of 1% to 1.5%. Our actual inorganic came in roughly at the midpoint of that range. The point being that when you look at our 11% growth for the year, the organic growth was obviously substantial. As we look forward to ’16, we are very proud of the success that we’ve had in the market with our acquisition activity in the last two quarters in particular. We also have four acquisitions, Pierre mentioned Cloud Sherpas, which had been announced, but not yet closed, but if you take what we closed and the four that have been announced, not yet closed, then we would estimate that our inorganic would be, let’s say, approaching the range, in the range of about 2% and of course that can change depending on the timing of when these four deals, Cloud Sherpas, in particular, ultimately gets closed. But we would be in that range. So, would be a click up.

That’s great. See you at I-Day. Thanks.

All right. Thank you, Tien-Tsin.

Your next question comes from the line of Ashwin Shirvaikar from Citi. Please go ahead.

Hi, thanks.

Hi, good morning, Ashwin.

Good morning. How are you guys? So, I guess my first question is clearly we appreciate the acquisitions that you made over the last few years. We actually wrote about it recently. But is there a flip side to it? I mean, can you talk about the growth rate that you are seeing on your traditional businesses? What sort of impact are you seeing from ERP slowdown, from the flip side of cloud, things like that? Because clearly, we have a portion of revenues growing really fast digital. You are handling that transition very well but the flip side is bringing down your overall growth rate, right. So --

Ashwin, let me just mention two things and then Pierre will want to round this out just in terms of kind of the factual context. Again, I want to point out that the year we just closed, our organic growth would have been about 9.5% roughly and so, the organic part of our business, that machine, was hitting on all cylinders in ’15 and was a real testament to the power of our growth strategy and this evolution of Accenture to focusing on our five businesses that we talked about leveraging the very distinctive channel that we have through our operating groups in our largest geographic market. So, just that factual point, our organic growth machine is hitting on all cylinders. You mentioned ERP, I’ll go ahead and put this out there that the ERP business, we’ve always said that ERP goes through cycles and -- but yet, at the end of the day, it’s an attractive business. Our ERP business did stabilize in ’15, it actually grew slightly. Now, as a percentage of our total revenue, it’s actually gotten -- it’s come down a click in terms of what it represents of Accenture’s business because the non-ERP is growing significantly but nonetheless, the ERP story is not a bad story. I’ll just pass it over to Pierre.

Yeah, just to -- probably just only reconfirm the element of our acquisition strategy, we are doing acquisitions for three reasons. I mean, the first one is to accelerate access to capabilities in the new and what we’re calling the new at Accenture is now the combination of digital services, cloud services, security services, all new technologies, if you will, such as cognitive computing, automation, or artificial intelligence. Second is to have access to very deep industry expertise, especially in consulting that is the rational for acquisition of Axia, Javelin, companies consulting deep structure iTRAK, either deep industry expertise in upstream energy in retail. That’s the reason -- that’s number two. And the number three would be to scale faster to take the leadership position in the marketplace and by leadership, we mean the Number 1. I’m thinking about Procurian, I’m thinking about Cloud Sherpas. I would put in that category, scale to lead putting more distance between Accenture and the competition. Three reasons why we’re doing acquisition and then we grew organic on top of this acquisition. Probably, one of the best case coming in my mind would be Procurian. We may yet consider Procurian, we became the Number 1 in procurement services and since we made this acquisition, we’ve been scaling faster, and now we are the market leader and the organic growth of our procurement services is even higher than the business days we built [ph].

Absolutely. Now I understand it and we’re actually fairly consistent with what we’ve predicting recently. The second question is just I want to ask about free cash flow growth in terms of the guidance looking at the lower end is negative, the upper end is 5% at the upper end, which is a ted slower than an EPS growth. And can you kind of go through the puts and takes with regards to free cash flow growth going forward? How you think about it? Clearly, it’s at an impressive absolute level, but I just want to understand how you’re thinking of sort of the cancellation from revenues to profits to cash?

Yeah, I mean, first of all I would encourage you and others to look at the absolute amount because the absolute amount as you referenced, I’ll use my word, but your thought I hope is that it’s outstanding. Our operating cash flow or free cash flow exceeds net income, which I think is a standard for any company which is indicative of outstanding cash flow and we’re in the range -- across our range, we’re in the range of let’s say around 1.1 of free cash flow to net income. And so, the absolute number is very, very strong. As we talked about before, there are many puts and takes in our cash flow in any particular year. Changes in DSO as an example, we have allowed for the possibility not that this is our -- what we’re trying to drive our teams to but we’ve allowed for the possibility of slight uptick in DSOs. You also noticed that we have allowed for further CapEx spending, which is part of the increase and then beyond that, there are differences in timings, for example, tax cash payments can be very different on one year -- from one year to the next. And so, there are many swings but what I would encourage you to focus on is the absolute cash flow, which exceeds net income and is great indicator of a strong cash generating company.

Okay. Thank you.

Your next question comes from the line of Darrin Peller from Barclays. Please go ahead.

Thanks guys. It’s interesting, we heard some commentary around Brazil and some of the emerging markets growing well. I guess when we think of your guidance and obviously, there is a deceleration partly due to just tougher comps, but I imagine some conservatism as well but I guess on top of that, I mean, how much is your expectation for Brazil or China or maybe even Russia or some of the other emerging markets that we’ve seen slower trends and having an impact on your model? I guess, I’m not quite sure we’ve heard contribution to your revenue from China or Brazil to be honest.

Yes, so, if you look at it indeed, we had a good year in some of these markets, overall growth markets, I mean, double-digit growth if you look at all the growth markets. But again, you will see in these growth markets, some of mature market names, I’m saying about Japan and Australia. Now, indeed, we had a very good performance of Brazil last year on back of some very good program in Accenture operations and our business as well in launching innovative services, especially around mortgage as a service on back of a small acquisition we made few years ago called Avere [ph] and our digital rotation as well which is happening in Brazil likewise it’s happening in other places. That being said, we’re looking at the market as you do. We understand that the global economic conditions in Brazil are deteriorating at some pace and it has been factored in our plan.

Okay. Have you ever given any disclosure on how much of a contribution Brazil or China might be to your business?

Yeah, we have given that disclosure. I guess, we showed the revenue number for Brazil.

I mean, Brazil is about a $1 billion. It’s about a $1 billion for Accenture. So again, it’s –

And China? Okay.

It’s not something that will be always significant. And in China, we are around half a billion.

Okay. That’s helpful guys. And just last follow-up question on the digital side, again, growth of 35% obviously very impressive.

Both trending to –

Yeah, China, we are about – we are less – we are about in the range of $300 million in that range, so about 1% of Accenture.

You know, he is always optimistic.

Okay, very helpful. Just one quick follow-up on the digital side again. The 35% growth rate, again very impressive. It seems like there is enough demand out there, for even of a larger base that kind of trend to continue. I know you said to Tien-Tsin before that, weight for IA Day, but I mean, I think it seems like could it be fair to assume that you can have at least something similar or very, very strong double-digit growth once again this year?

I think that – we think in terms of continued strong double-digit growth, 35% is a big number. And for planning purposes, we considered the scale of the business, but 35% is a big number and I don’t know that we would assume that for planning purposes, not that we wouldn’t strive forward.

Understood.

We got plan for double-digits.

Yeah, certainly for double-digit.

Nice. Okay, guys thanks.

Thank you very much.

Your next question comes from the line of Keith Bachman from Bank of Montreal. Please go ahead.

Good morning.

Hi, thank you very much. I wanted to ask about pricing. Recently Cognizant called out, what was normally a fairly deliberate and conservative company that pricing pressure has increased in part of their business in a while. I understand that there isn’t perfect overlap in competitive areas between yourself and an Indian-based player Cognizant. I did want to hear what you’re seeing in the pricing environment across the breadth of the business that’s particularly in the allocation maintenance and application development world specifically?

Yeah, I would say that, you may remember, it was in the second – it was our second quarter’s call, I mentioned that we were pleased with the progress that we have made in pricing relative to where we were in the previous year. And I would say that relative to those comments, our pricing has remained very stable and so we’ve – I would characterize the environment – it’s tough to paint with a broad brush, because it really is different depending on which part of our business that you look at. But certainly overall, the environment continues to be competitive. If I had to give an overall characterization, I would say stable at the levels that we indicated that in the second quarter. You know, if you look back, I would – you asked specifically about application services that continues to be a very competitive market, but our pricing is stable. We see other parts of our business where we see some pricing power and when I say that I think about Accenture strategy and Accenture consulting.

Okay, fair enough. And my follow-up question if I could is, your Global Delivery Network continues to tick-up, which I think is part of the reason why you’re able to move your margins, almost 72% of employment basis in the global network now. Is there a natural resistance point that will add some level? Can you – if we look out over the next couple of years, can that continue to move up where you move say over 80% of employment basis in the GDN? If you can just talk about any natural resistance point, particularly as you think about digital forming a greater percent of revenue, which I would think would be more local headcount? Would like to hear your characterization. Thanks very much.

We don’t think in terms of a natural resistance point. I mean, we think that we’ve got a lot of flexibility for how our Global Delivery Network can continue to evolve. But we certainly don’t think in terms of any natural resistance point. We drive it as the market evolves and as I said, we’ve got flexibility still in front of us.

Yes, and when you look from a skill standpoint, I mean, you’re right to mention that part of the work we are doing in digital related services could be onshore. However, we are probably the largest – one of the largest application, perhaps enterprise apps developer in the world. All these developments are being made via our Global Delivery Network and it’s definitely part of digital related services. I am thinking about as significant part of our business in analytics as well being done with our resources, especially in India and other places. When I think about strong innovations in term of automation, robotics, cognitive computing and artificial intelligence, they are coming a lot from the Philippines and from India as well. So I guess, it would be a bit simplistic to see our GDN as a kind of a low-cost, low-value kind of capability. It is a right cost, very high value workforce.

Okay, great. Thank you guys.

Thank you.

Your next question comes from the line of Edward Caso from Wells Fargo. Please go ahead.

Good morning, Ed.

Good morning. Congrats on the quarter. I was curious if how much of a drag that the acquisitions have become to your margin and is it this rapid growth in the GDN that was just mentioned, is that providing adequate offset?

Well, first of all, Ed, I would say that if you look at the performance of our portfolio overall, we are quite pleased with the performance of our portfolio of acquisitions from revenue through profitability and cash flow, and that’s something we track very carefully. We review certainly ourselves, but with our Board as well each quarter. And we believe we have some pretty half hurdles, financial hurdles for the transactions that we do. Having said that, as you know, it certainly wouldn’t be unusual for an acquisition to be dilutive in the first year or two possibly. But we do -- one of our hurdles is the pace of which a deal becomes on par and then accretive, but certainly in the first couple of years that can be dilutive. I’d also point out that whereas many other companies in our sector tend to adjust for certain types of acquisition related costs, the amortization of intangibles, things like performance retention payments at the time of closure, third party fees et cetera, we’ve chosen not to do that. And we report our margin all in. To-date our margin expansion commitment has been based on our philosophy that we absorb those as part of our investments and we drive the business forward. And of course that’s just one part of our investment. We have investments that go well beyond that. The impressive thing about our profit model to-date is that when you look at that 20 basis points of expansion underneath that, we are driving significant efficiency across our business to absorb the investments acquisition and otherwise, and that's an important story to understand, so I am glad you asked that question.

My other question is on clarification on pricing. When you talk about stable pricing, sort of what does that mean? I mean, we hear that clients are more focused on reducing total cost of ownership. So you and your competitors may be able to sustain margin, but it’s your – you’re giving back some volume. Help us understand better what you mean by pricing? Thanks.

So to remind you and the other listeners, when we talk about price and we’ve always said very clearly that we are talking about the profit or margin percentage on the work that we sell. And it’s in that context -- when I say pricing is stable, it’s in that context that I make that statement. And so when you look at application services as an example, when you look at our margin on work that we are contracting, that is stable. I mentioned other areas where we have sources of some pricing power, I mentioned strategy and consulting. I also say that in the context of the margin, but I will also add that if you were to look at in that part of our business, people might talk about things like average daily rates, we’re also pleased with average daily rate progression in that part of our business as well.

Thank you.

Thank you.

Your next question comes from the line of Lisa Ellis from Bernstein. Please go ahead.

Good morning, Lisa.

Hi, guys. Good morning. First I guess, I will ask directly the question I think many are wondering, which is, what is it are you seeing in the numbers that’s causing the implied kind of sharp quarter-on-quarter deceleration in the guide for Q1?

Yeah, so if you look at our guides for quarter one, the range is 6% to 9% in local currency growth. I mean, when I look at quarter one or the full year, maybe, Lisa, if you will, I’ll just – let me just expand my comments a little bit. I mean, when you look at our guidance, you first of all have to understand what is our assumption on market growth. And we assume that the market will continue to grow plus or minus in the 4% range. And so when you look at our guidance for the year, certainly if you look at our guidance for quarter one, the same would apply across that range, but certainly at the upper end of that range, it reflects taking significant market share, continuing to take significant market share, which is our strategic objective. The other thing that you have to consider goes back to some of the discussion that Pierre had I believe with Darrin on the growth markets and the risk profile. But also I think, when we look at the macro environment in general, relative to where we were 90 days ago, I would say, relative to where we were at this time last year, the volatility and risk in the macro environment has clicked up a notch or two, and so that’s a factor then. The other thing that we think about when we look at our guidance is that it’s as important if not more important to look at the absolute dollars as it is the percentage, whether it be the first quarter or the full year. And if you just look at the full year, before you adjust for the FX headwind, just taking that out, look at the underlying growth, at the upper end of our range, we will be adding about $2.5 billion of revenue, excluding the impact of FX in fiscal 2016, which is a pretty health number. And so we work hard to drive to the upper end of the range, although the range reflects what we think are the range of possibilities. And as it relates to the full year, we’re early in the year and as we did last year, we’ll adjust as we go. That was more of an answer than your question, but it gave me an opportunity to share some of those thoughts.

Terrific. Thank you. And then a little broader question, taking a step back and just reviewing FY15, how has the competitive set that you guys are competing against in deals changed?

We’ve not seen much change in the competitive environment. I think the competition is quite well established in the different businesses we’re operating in from the consulting and strategy with the usual players. Then, you have the technology with the other players and then of course operations, different part of our business. So I guess, the environment is pretty stable with some, I mean, winners and losers and we are investing and driving our business to be part of the winners. But not much to say around the competitive environment, it’s still the usual suspects.

Terrific. Thank you.

Thank you.

Your next question comes from the line of Sara Gubins from Bank of America. Please go ahead.

Hi. Thank you. Good morning.

Hi. Good morning, Sara.

Do you think that your visibility is changing at all, given that a greater portion of growth is coming from digital?

I would say that to the extent that digital has a strong consulting concentration and if you look at the, let’s say, the average duration of a consulting contract versus an outsourcing contract, it would be true to say that the duration is shorter for consulting than it is for outsourcing. So in that sense, it does give you a different backlog kind of profile going forward. We’re very pleased with how our strategy in consulting and the development of new technology that we report within application services, that has been a great story for us, but it does change the dynamic as you’re alluding to.

Great. And then separately, could you talk about your hiring plans for next year and the hiring environment overall? Thanks.

Yeah. We will -- we are still in the midst of finalizing those and I will comment on that as appropriate at IA Day, but it’s a little premature for me to give you a number at this point.

Okay. Thank you.

Thank you.

Your next question comes from the line of Bryan Keane from Deutsche Bank. Please go ahead.

Yeah. Good morning. Just speaking of headcount growth, I think it was up 17% year-over-year, that’s the highest I can remember in a long time, can you just talk about how that translates into revenue? I would have guessed it would have pushed a little bit higher guidance growth rate for the constant currency revenue growth for fiscal year ’16?

Yeah. First of all, we were really pleased with our recruiting in the fourth quarter. I mean, we continue to be and even more so, a real, I would say, magnet for talent in the marketplace and so we had very successful recruiting efforts as you know. The fourth quarter is typically when we bring on our campus hires and so that’s reflected in the number and so we manage the supply and demand very carefully. And we -- the one point is where we start the year and then of course we have to manage our headcount as we progress through the year and we will see how attrition plays out as we evolve through the first half of the year. We will see how the revenue trajectory progresses and then as always, we adjust headcount appropriately.

What’s that relationship, shouldn’t the relationship be closer to revenue growth for the following year?

Well, it’s -- I’m not -- as a general -- well, it depends, it just depends on so many different assumptions. It depends on how we see pricing evolving. It depends on how we see our revenue yield per head evolving. It depends on what we might expect with attrition. It depends on – perhaps, we hired a disproportionate number of people in quarter four and we expect to hire less than normal in quarter one and so, there are so many factors that go in to that. I wouldn’t over read the headcount. What I’d focus on is the guidance we gave and the context that I gave for the guidance.

Okay. Just last quick follow-up, what’s the mix between consulting and outsourcing on the growth rate that we should expect between the 5% to 8% guidance? I saw consulting has obviously been a little bit stronger than outsourcing. Just want to see if that probably continues for next year?

Yes. We see -- we actually see very balanced growth, as we have looked at our business plans. We actually see very balanced growth and we would see, let’s say, both consulting and outsourcing in the context of a 5 to 8 range, we would see both of those kind of be in the same zone. So in the mid to high single digits is the potential range for both of them.

Okay. Super. Thanks for the color.

Thank you very much. I appreciate it.

Great. We have time for one more question and then Pierre will wrap up the call.

Okay. Your final question today comes from the line of Brian Essex from Morgan Stanley. Please go ahead.

Good morning and thanks for taking the question. I was wondering if you can talk about a little bit about -- I just noticed that the acceleration in the European or EMEA constant currency growth rate was really nice this quarter. So you had about a year and a half now of accelerating growth in Europe and I was just wondering if you can touch on the environment in Europe and what are some of the key drivers to that acceleration, so that we can get an idea of how that might be sustainable going forward?

Yes. Sure. Thank you. And by the way, Jo Deblaere who is leading our European business is in the room and he could be more pleased with your comments on Europe. And yes, I mean, we’re pleased with where we are because we’ve seen the growth and of course, when you understand the overall economic environment in Europe, it’s much different from the one for instance you have in the US. So it’s more about us than about the market of course. And I would call probably the same trend. It’s fascinating to see that the digital rotation we’ve seen in Europe is as strong, even slightly stronger than the one we could see in the US. It appears that our target clients, mainly the premium brand in the G2000 we’re serving in Europe are really accelerating their investments in terms of digital rotation. Second, we had some very significant transactions, leveraging Accenture operations with our business process services, I’m thinking about, I mean the Finance and Accounting, the HR, the procurement as well and it’s been a significant source of growth and overall, the consulting is back, probably driven as well with the digital related services. So for Europe, again, the clients we’re serving, more than the GUs, are reinvesting. We’re always nice on rationalization, driving good growth for Accenture operations and the other eye on growth and digital, which is driving more business for Accenture Digital, Accenture Strategy and Accenture Consulting and of course the leadership of Jo Deblaere.

Great. And maybe just for a follow-up, I know the deal hasn’t closed yet, but I think Cloud Sherpas was a great pick up. We know them as a leading cloud broker and a substantial salesforce.com partner. Maybe if you could, to the extent you can, talk about the rationale behind that deal and where some of the leverage across your platform might come from and any kind of overlap with their current brokerage business?

Yes. Sure. I mean, two main reasons. First, and you’ve seen that in the terminal, which has been used by Paul Daugherty, our Chief Technology Officer, we’re taking a cloud first approach. So we are strongly believers that indeed now and even more moving forward, this cloud first agenda will be quite prevalent for our clients and we want to preempt to be ahead of the curve or to embrace whatever you’re going to call it, this new cloud first environment and so to be a prominent provider in the add to service, software and solution as a service environment. So second, when we have defined this position for Accenture, the name of the game for us was how to scale more rapidly to take the leadership position, especially around the salesforce.com solution and Cloud Sherpas was a very relevant opportunity for us to scale rapidly the good capabilities we have as we speak, we are the leader in providing services for salesforce.com. We are already the leader and we believe that through this acquisition, they have excellent people, a significant number of this people being certified, which is even more important, we are scaling faster and are taking the leadership in this market, which we believe is going to be promising in the coming years.

Is there a geographical component as well or is it primarily just merging the two capabilities together?

Yes, no, indeed, I mean, it’s global with a very significant and good footprint in the U.S., but it’s global and nicely covering two or three of our most significant markets around the world. So we should take this leading position not only in one, but certainly in few of the markets around the world. Very nice fit for us.

Yes.

Alright. I think we stand to wrap up KC. Excellent. So thanks to all of you again for joining us on today’s call. And in closing, I just want to take this opportunity to first, thank our clients for the trust they place in Accenture as their business partner. At the same time, I also want to extend my deep and sincere thanks to the men and women of Accenture around the world. Every minute of every day, our people demonstrate an incredible level of commitment to delivering value for our clients and for our company and finally, of course, I want to thank you, investors for your continued support and confidence in Accenture. We look forward to talking with you again next quarter and also to seeing many of you in person at our Investor and Analyst Conference in New York on October, the 7th. In the meantime, if you have any questions, please feel free to call KC and all the best.