Globally accredited management and technology consulting company Accenture plc (ACN - Analyst Report) will now provide technology architecture and Enterprise Data Warehouse support to the California Franchise Tax Board (FTB). For successful implementation, Accenture will work jointly with CGI Group Inc. (GIB - Snapshot Report). Financial terms of the deal were kept confidential.
The FTB is responsible for managing two of California's major tax programs, namely Personal Income Tax and Corporation Tax. The responsibilities include processing of personal and business tax returns, answering inquiries and collecting more than 65% of the state’s general fund revenues.
The huge workflow requires prompt data availability, spontaneous data analysis and an effective tax assessment system, which are all subject to challenges. Hence, it becomes difficult to maintain throughput.
To help fight these challenges, Accenture will provide its service-oriented architecture (SOA) and workflow architecture components to provide FTB greater system flexibility and improved operational efficiencies. Moreover, it will develop an Enterprise Data Warehouse to facilitate centralized data processing and integration of disparate data, currently stored in multiple systems. Leveraging Accenture’s services, FTB will be able to deliver a prompt taxation system and help the state in generating revenues within time.
Accenture’s affluent industry experience has helped it win deals from various industrial sectors, geographical locations and governments. The steady demand for its cloud computing, virtualization, systems integration, enterprise resource planning and other application services has helped the company generate four straight quarters of double-digit sales and earnings growth.
We are encouraged by the company’s steady flow of new business and believe that the trend will continue. However, increasing competition from IBM Corp. (IBM - Analyst Report), a strained spending environment and Accenture’s broad European exposure keep us Neutral on the stock.
Currently, Accenture has a Zacks #3 Rank, which implies a short-term Hold rating.