Accenture, the management consultancy spun out of Arthur Andersen in 2000, has unveiled a sharp fall in profits.

But the firm attributed the collapse, from $80.9m (�56.3m) in the first three months of 2001 to just $10.6m in the same period of this year, to a hefty write-off for ditching some failed investments.

Stripping out the effects of this investment charge, the firm's profits were up slightly, while revenues remained more or less steady at $2.9bn.

Accenture's shares were listed on the New York Stock Exchange last July, and have performed strongly since, only pausing for breath this year as investors became nervous about consulting companies post-Enron.

Unwise investments

Accenture has had to take the $212m charge because it plans to sell almost all of its venture and investment portfolio in order to reduce volatility in future earnings.

Its fingers painfully burnt by the experience, Accenture now plans to cease venture capital and other investment activity, "and will no longer accept illiquid securities from clients or alliance partners."

The firm did not elaborate on the exact nature of the loss-making investments.

As for its core consulting business, Accenture expressed cautious optimism.

While it pointed out "a number of positive indicators" in its business, the firm insisted that the global economic recovery was moving very slowly.