Revenues

9 Months Ended

Sep. 30, 2021

Revenue from Contract with Customer [Abstract]

Revenues

Disaggregation of Revenues

The tables below present disaggregated revenues from contracts with clients by client location, service line and contract type for each of our business segments. We believe this disaggregation best depicts how the nature, amount, timing and uncertainty of our revenues and cash flows are affected by industry, market and other economic factors. Revenues are attributed to geographic regions based upon client location, which is the client's billing address. Substantially all revenues in our North America region relate to operations in the United States.

We have defined our Financial Services, Healthcare, Products and Resources and Communications, Media and Technology segments as ("FS"), ("HC"), ("P&R"), and ("CMT"), respectively, in our disaggregation of revenues tables.

	Three Months Ended September 30, 2021										Nine Months Ended September 30, 2021
(in millions)	FS		HC		P&R		CMT		Total		FS		HC		P&R		CMT		Total
Geography:
North America	$	1,075	$	1,162	$	749	$	500	$	3,486	$	3,137	$	3,394	$	2,190	$	1,420	$	10,141
United Kingdom	140		44		125		121		430		395		129		347		332		1,203
Continental Europe	187		118		145		34		484		565		356		380		121		1,422
Europe - Total	327		162		270		155		914		960		485		727		453		2,625
Rest of World	142		30		88		84		344		407		88		243		226		964
Total	$	1,544	$	1,354	$	1,107	$	739	$	4,744	$	4,504	$	3,967	$	3,160	$	2,099	$	13,730
Service line:
Consulting and technology services	$	1,049	$	785	$	715	$	441	$	2,990	$	3,028	$	2,299	$	1,999	$	1,259	$	8,585
Outsourcing services	495		569		392		298		1,754		1,476		1,668		1,161		840		5,145
Total	$	1,544	$	1,354	$	1,107	$	739	$	4,744	$	4,504	$	3,967	$	3,160	$	2,099	$	13,730
Type of contract:
Time and materials	$	922	$	515	$	468	$	437	$	2,342	$	2,729	$	1,548	$	1,332	$	1,256	$	6,865
Fixed-price	527		554		530		265		1,876		1,498		1,582		1,517		744		5,341
Transaction or volume-based	95		285		109		37		526		277		837		311		99		1,524
Total	$	1,544	$	1,354	$	1,107	$	739	$	4,744	$	4,504	$	3,967	$	3,160	$	2,099	$	13,730

	Three Months Ended September 30, 2020										Nine Months Ended September 30, 2020
(in millions)	FS		HC		P&R		CMT		Total		FS		HC		P&R		CMT		Total
Geography:
North America	$	1,033	$	1,054	$	666	$	426	$	3,179	$	3,023	$	3,091	$	1,975	$	1,286	$	9,375
United Kingdom	123		40		96		86		345		353		116		278		249		996
Continental Europe	181		116		97		43		437		554		317		300		122		1,293
Europe - Total	304		156		193		129		782		907		433		578		371		2,289
Rest of World	132		21		68		61		282		386		58		195		165		804
Total	$	1,469	$	1,231	$	927	$	616	$	4,243	$	4,316	$	3,582	$	2,748	$	1,822	$	12,468
Service line:
Consulting and technology services	$	984	$	725	$	564	$	369	$	2,642	$	2,864	$	2,053	$	1,674	$	1,055	$	7,646
Outsourcing services	485		506		363		247		1,601		1,452		1,529		1,074		767		4,822
Total	$	1,469	$	1,231	$	927	$	616	$	4,243	$	4,316	$	3,582	$	2,748	$	1,822	$	12,468
Type of contract:
Time and materials	$	932	$	505	$	392	$	372	$	2,201	$	2,689	$	1,448	$	1,164	$	1,112	$	6,413
Fixed price	450		466		434		218		1,568		1,377		1,292		1,286		638		4,593
Transaction or volume-based	87		260		101		26		474		250		842		298		72		1,462
Total	$	1,469	$	1,231	$	927	$	616	$	4,243	$	4,316	$	3,582	$	2,748	$	1,822	$	12,468

Costs to Fulfill

Costs to fulfill, such as setup or transition activities, are recorded in "Other noncurrent assets" in our unaudited consolidated statements of financial position and the amortization expense of costs to fulfill is included in "Cost of revenues" in our unaudited consolidated statements of operations. Costs to obtain contracts were immaterial for the periods disclosed. The following table presents information related to the capitalized costs to fulfill for the nine months ended September 30:

(in millions)	2021		2020
Beginning balance	$	467	$	485
Amortization expense	(88)		(71)
Costs capitalized	38		78
Impairment	(11)		(10)
Ending balance	$	406	$	482

Contract Balances

A contract asset is a right to consideration that is conditional upon factors other than the passage of time. Contract assets are presented in "Other current assets" in our unaudited consolidated statements of financial position and primarily relate to unbilled amounts on fixed-price contracts utilizing the cost-to-cost method of revenue recognition. The table below shows significant movements in contract assets for the nine months ended September 30:

(in millions)	2021		2020
Beginning balance	$	315	$	334
Revenues recognized during the period but not billed	298		281
Amounts reclassified to trade accounts receivable	(264)		(282)
Ending balance	$	349	$	333

Our contract liabilities, or deferred revenue, consist of advance payments and billings in excess of revenues recognized. The table below shows significant movements in the deferred revenue balances (current and noncurrent) for the nine months ended September 30:

(in millions)	2021		2020
Beginning balance	$	419	$	336
Amounts billed but not recognized as revenues	309		260
Revenues recognized related to the opening balance of deferred revenue	(379)		(279)
Ending balance	$	349	$	317

Revenues recognized during the three and nine months ended September 30, 2021 for performance obligations satisfied or partially satisfied in previous periods were immaterial.

Remaining Performance Obligations

As of September 30, 2021, the aggregate amount of transaction price allocated to remaining performance obligations was $1,658 million, of which approximately 80% is expected to be recognized as revenue within 2 years. Disclosure is not required for performance obligations that meet any of the following criteria:

(1)contracts with a duration of one year or less as determined under ASC Topic 606: "Revenue from Contracts with Customers",

(2)contracts for which we recognize revenues based on the right to invoice for services performed,

(3)variable consideration allocated entirely to a wholly unsatisfied performance obligation or to a wholly unsatisfied promise to transfer a distinct good or service that forms part of a single performance obligation in accordance with ASC 606-10-25-14(b), for which the criteria in ASC 606-10-32-40 have been met, or

(4)variable consideration in the form of a sales-based or usage-based royalty promised in exchange for a license of intellectual property.

Many of our performance obligations meet one or more of these exemptions and therefore are not included in the remaining performance obligation amount disclosed above.

Trade Accounts Receivable and Allowance for Credit Loss

We calculate expected credit losses for our trade accounts receivable based on historical credit loss rates for each aging category as adjusted for the current market conditions and forecasts about future economic conditions. The following table presents the activity in the allowance for trade accounts receivable for the nine months ended September 30:

(in millions)	2021		2020
Beginning balance	$	57	$	67
Impact of adoption of the Credit Loss Standard	—		(1)
Credit loss expense	5		18
Write-offs charged against the allowance	(12)		(11)
Ending balance	$	50	$	73