Accenture, the world's biggest management consultancy, has revealed a sharp drop in first quarter profits, blaming reduced demand for technology consulting services.

There consultancy is one of the largest providers of outsourcing services for the insurance industry.

Profits for the quarter ended 30 November 2001, which is the start of the firm's fiscal year 2002, fell 45% to $81.7m (£56.5m) from $148.5m (£102.8m) during the same period the previous year.

First-quarter net revenues for the communications and high tech, and financial services global market units were $743m (£514m) and $717m (£496m), respectively, down 14% from the first quarter 2001.

Accenture said in a statement the figures were "reflecting the challenges that the financial services, communications and technology sectors faced during the period".

Accenture also said it had absorbed a one-off $90m (£62m) charge during the period to reflect a drop in the value of some investments.

Goldman Sachs analyst Richard Burdon said the reduction in spending on technology consulting is a general market trend.

"When things get tight from a feared recession and a results point of view, everything is pulled back," he said.