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Revenue and Contract Balances
 3 Months Ended
Dec. 31, 2023
Revenue from Contract with Customer [Abstract]  
Revenue and Contract Balances Revenue and Contract Balances
We disaggregate revenue by client sector and contract type, as we believe it best depicts how the nature, timing and uncertainty of revenue and cash flows are affected by economic factors. The following tables present revenue disaggregated by client sector and contract type (in thousands):
 Three Months Ended
 December 31,
2023		January 1,
2023
Client Sector:  
U.S. federal government (1)
$382,076 $276,075 
U.S. state and local government150,925 153,195 
U.S. commercial222,430 198,956 
International (2)
472,836 266,540 
Total$1,228,267 $894,766 
Contract Type:
Fixed-price$471,442 $327,737 
Time-and-materials549,651 420,570 
Cost-plus207,174 146,459 
Total$1,228,267 $894,766 
(1)    Includes revenue generated under U.S. federal government contracts performed outside the United States.
(2)    Includes revenue generated from non-U.S. clients, primarily in Canada, Australia, Europe and the United Kingdom.

Other than the U.S. federal government, no single client accounted for more than 10% of our revenue for the first quarters of fiscal 2024 and 2023.

Contract Assets and Contract Liabilities

We invoice customers based on the contractual terms of each contract. However, the timing of revenue recognition may differ from the timing of invoice issuance. Contract assets represent revenue recognized in excess of the amounts for which we have the contractual right to bill our customers. Such amounts are recoverable from customers based upon various measures of performance, including achievement of certain milestones or completion of a contract. In addition, many of our time and materials arrangements are billed in arrears pursuant to contract terms that are standard within the industry, resulting in contract assets and/or unbilled receivables being recorded, as revenue is recognized in advance of billings. Contract retentions, included in contract assets, represent amounts withheld by clients until certain conditions are met or the project is completed, which may extend beyond one year.

Contract liabilities consist of billings in excess of revenue recognized. Contract liabilities decrease as we recognize revenue from the satisfaction of the related performance obligation and increase as billings in advance of revenue recognition occur. Contract assets and liabilities are reported in a net position on a contract-by-contract basis at the end of each reporting period. There were no substantial non-current contract assets or liabilities for the periods presented. Net contract assets/liabilities consisted of the following (in thousands):
Balance at
December 31,
2023		October 1, 2023
Contract assets (1)
$89,073 $113,939 
Contract liabilities382,862 335,044 
Net contract liabilities$(293,789)$(221,105)
(1)    Includes $6.0 million and $6.8 million of contract retentions at December 31, 2023 and October 1, 2023, respectively.

In the first quarters of fiscal 2024 and 2023, we recognized revenue of approximately $130 million and $81 million, respectively, from the amounts included in the contract liability balances at the end of fiscal 2023 and 2022, respectively.

Revenue is recognized by measuring progress over time under Accounting Standards Codification Topic 606, "Revenue from Contracts with Customers". We estimate and measure progress on our contracts over time whereby we compare our total costs incurred on each contract as a percentage of the total expected contract costs. Changes in those estimates could result in the recognition of cumulative catch-up adjustments to the contract’s inception-to-date revenue, costs and profit in the
period in which such changes are made. As a result, in the first quarters of fiscal 2024 and 2023, we recognized net favorable revenue and operating income adjustments of $5.7 million and $3.5 million, respectively.

Changes in revenue and cost estimates could also result in a projected loss, determined at the contract level, which would be recorded immediately in earnings. At December 31, 2023 and October 1, 2023, our consolidated balance sheets included liabilities for anticipated losses of $9.2 million and $8.5 million, respectively. The estimated cost to complete these related contracts was approximately $68 million at December 31, 2023 and October 1, 2023.

Accounts Receivable, Net

Net accounts receivable consisted of the following (in thousands):

Balance at
 December 31,
2023		October 1,
2023
Billed$700,880 $672,712 
Unbilled344,628 306,788 
Total accounts receivable1,045,508 979,500 
Allowance for doubtful accounts(4,998)(4,965)
Total accounts receivable, net$1,040,510 $974,535 

Billed accounts receivable represent amounts billed to clients that have not been collected. Unbilled accounts receivable, which represent an unconditional right to payment subject only to the passage of time, include unbilled amounts typically resulting from revenue recognized but not yet billed pursuant to contract terms or billed after the period end date. Substantially all of our unbilled receivables at December 31, 2023 are expected to be billed and collected within 12 months. The allowance for doubtful accounts represents amounts that are expected to become uncollectible or unrealizable in the future. We determine an estimated allowance for uncollectible accounts based on management's consideration of trends in the actual and forecasted credit quality of our clients, including delinquency and payment history; type of client, such as a government agency or a commercial sector client; and general economic and industry conditions, which may affect our clients' ability to pay.

Other than the U.S. federal government, no single client accounted for more than 10% of our accounts receivable at December 31, 2023 and October 1, 2023.

Remaining Unsatisfied Performance Obligations (“RUPO”)

Our RUPO represents a measure of the total dollar value of work to be performed on contracts awarded and in progress. We had $4.7 billion of RUPO at December 31, 2023. RUPO increases with awards from new contracts or additions on existing contracts, and decreases as work is performed and revenue is recognized on existing contracts. RUPO may also decrease when projects are canceled or modified in scope. We include a contract within our RUPO when the contract is awarded and an agreement on contract terms has been reached.

We expect to satisfy our RUPO at December 31, 2023 over the following periods (in thousands):
Amount
Within 12 months$3,149,015 
Beyond 1,558,073 
Total $4,707,088 
Although RUPO reflects business that is considered to be firm, cancellations, deferrals or scope adjustments may occur. RUPO is adjusted to reflect any known project cancellations, revisions to project scope and cost, foreign currency exchange fluctuations and project deferrals, as appropriate. Our operations and maintenance contracts can generally be terminated by the clients without a substantive financial penalty. Therefore, the remaining performance obligations on such contracts are limited to the notice period required for the termination (usually 30, 60, or 90 days)